Lorenzo Letter #13: Polymarket Reveals Stablecoin Plans

Welcome back to the Lorenzo Letter, your weekly update on stablecoins, DeFi, tokenization, crypto legislation, and more.

In This Issue:

• Polymarket Reveals Stablecoin Plans
• Morgan Stanley Launches Bitcoin ETF, Undercuts Rivals on Fees
• CLARITY Act Nears Senate Vote as Stablecoin Debate Intensifies

Polymarket Reveals Stablecoin Plans

Polymarket is preparing its biggest platform upgrade yet, with plans to launch a native stablecoin and rebuild its core trading infrastructure over the coming weeks.

At the center of the overhaul is Polymarket USD, a proprietary collateral token backed 1:1 by Circle-issued USDC. The token will replace bridged USDC.e as the platform’s default settlement asset, with automatic frontend migration for most users and manual conversion required for power users and API traders.

By controlling its collateral layer and core exchange infrastructure, Polymarket is positioning itself to operate more like a fully fledged exchange rather than a standalone application.

Full Story:

Polymarket Plans Native Stablecoin as Part of Major Exchange Overhaul

Polymarket plans a major exchange upgrade with a new trading engine and native stablecoin, Polymarket USD, as it scales infrastructure and prepares for U.S. expansion.

Lorenzo ProtocolBart Hillerich

Morgan Stanley Launches Bitcoin ETF, Undercuts Rivals on Fees

Morgan Stanley has entered the spot bitcoin ETF market with the launch of its Morgan Stanley Bitcoin Trust (MSBT), marking the first time a U.S. bank-affiliated asset manager has issued a crypto ETP under its own brand. The fund began trading on NYSE Arca and tracks bitcoin’s price using the CoinDesk benchmark.

MSBT debuted with a 0.14% sponsor fee, undercutting major competitors like BlackRock’s iShares Bitcoin Trust (IBIT) at 0.25%.

Beyond pricing, Morgan Stanley’s key advantage lies in distribution. With over $6 trillion in client assets and a global advisor network, the firm can directly integrate MSBT into wealth management portfolios, potentially unlocking a new wave of demand from advised investors.

Full Story:

Morgan Stanley Launches Bitcoin ETF, Undercuts Rivals on Fees

Morgan Stanley launches its first spot Bitcoin ETF, MSBT, offering the lowest fees in the market and challenging BlackRock as competition shifts toward pricing and distribution.

Triana: Crypto News, Insights, StoriesBart Hillerich

CLARITY Act Nears Senate Vote as Stablecoin Debate Intensifies

Momentum is building in Washington as the CLARITY Act advances toward a potential Senate vote later this month. Lawmakers expect the bill to move through the Senate Banking Committee soon, though key issues remain unresolved.

At the center of negotiations is a contentious debate over stablecoin yield. Proposed restrictions on interest or rewards have divided crypto firms and traditional banks, with the former arguing incentives are critical for adoption, while banks warn of deposit outflows and systemic risk.

The legislation is part of a broader regulatory push that includes the GENIUS Act and new federal guidelines on stablecoin oversight. Meanwhile, agencies like the CFTC and DOJ are ramping up enforcement across prediction markets and trading activity, underscoring growing federal involvement in digital assets.

The coming weeks will shape the fate of the CLARITY Act and the future structure of onchain financial markets in the U.S.

Full Story:

CLARITY Act Advances Toward Senate Vote as Stablecoin Debate Intensifies in Washington

Lawmakers push the CLARITY Act toward a Senate vote as debates over stablecoin yield, banking risks, and crypto regulation intensify in Washington, signaling a pivotal moment for U.S. digital asset policy.

Lorenzo ProtocolBart Hillerich