5.26 AI Daily Report: The encryption industry welcomes a new situation: stricter regulations, continuous innovation, and increasing market differentiation.

1. Headlines

1. The Trump administration pushed for the passage of the GENIUS Act, marking a strategic initiative to align digital assets with U.S. monetary policy.

The Trump administration has recently pushed for the passage of the GENIUS Act, aimed at establishing a regulatory framework for digital assets such as stablecoins. The act requires stablecoin issuers to comply with reserve requirements similar to those of banks and to accept auditing and disclosure obligations. This marks the official incorporation of digital assets into the national monetary policy framework in the United States.

Analysts believe that the passage of this bill will provide legal certainty for the development of stablecoins. On one hand, it helps with the application of stablecoins in areas like payments and settlements, improving efficiency and reducing costs; on the other hand, it will also promote the integration of stablecoins with the traditional financial system. However, overly strict regulation may hinder innovation.

In addition, the development of stablecoins may affect the international status of the US dollar. If stablecoins are widely used globally, it will undermine the dollar's position as the world's reserve currency. Therefore, this bill is also seen as a strategic move by the US to maintain the hegemony of the dollar.

2. After the Sui chain was attacked by hackers, the "frozen" stolen funds triggered a dispute over decentralized authority.

The Sui chain recently suffered a hacker attack, with stolen funds amounting to approximately $160 million. To recover the losses, the Sui chain coordinated through the validator network to implement a "freeze" operation on the hacker's address, successfully recovering some of the funds.

This operation has raised doubts in the blockchain community regarding the level of decentralization. On one hand, it is commendable that the Sui chain can quickly take action to recover losses; on the other hand, the ability of validators to override on-chain rules clearly contradicts the concept of decentralization.

Analysts point out that this reflects the current dilemma of public chains in balancing security and decentralization. Excessive decentralization may affect the efficient operation of the system and its emergency response capability; while excessive centralization goes against the original intention of blockchain. Therefore, a balance needs to be sought between the two.

In addition, this incident highlights the importance of on-chain governance mechanisms. How to regulate permission allocation, ensure system security, and maintain decentralization through on-chain governance will be an important issue that public chain development needs to address in the future.

3. Experience at the Token2049 Conference: There is still a glimmer of innovation in the industry's low period.

The Token2049 conference took place in Singapore on May 18-19. Attendees reflected the current downturn in the crypto industry, but also revealed some new innovative glimmers of hope.

On one hand, traditional sectors such as full-chain gaming, NFTs, and social networking are being debunked, leaving practitioners feeling confused. On the other hand, the combination of AI and social networking is seen as a new opportunity, attracting the attention of many traditional AI companies and funding.

Analysts believe that the current industry is in a phase of cyclical downturn. Previous business logic such as "user growth hacking" and "listing coins" is no longer viable, and new development paths need to be sought. Real users and sustainable business models will be key in the future.

At the same time, the increasingly clear regulations will also drive the industry towards compliance. The introduction of the "Stablecoin Regulation Draft" in Hong Kong and the promotion of the GENIUS Act in the United States will create a favorable environment for the long-term healthy development of the industry.

4. OpenAI expands into the Asian market, with South Korea as the first stop.

Artificial intelligence company OpenAI announced that it will establish an office in South Korea, which is its first base in the Asia region. Analysts believe that this move aims to seize the rapidly growing AI market in Asia.

The South Korean government places great importance on the development of the AI industry and has formulated several support policies. At the same time, South Korean technology companies are also in a leading position in the AI field. Therefore, OpenAI's choice of South Korea as the regional headquarters for Asia has certain strategic significance.

In the future, OpenAI is expected to leverage its presence in South Korea to strengthen collaborations with local companies and explore more business opportunities. At the same time, it will also face fierce competition from tech giants such as Google and Microsoft.

OpenAI's expansion in Asia also reflects the global trend of the AI industry. Major companies are accelerating their global布局 to acquire more data resources, technical talent, and to explore emerging markets. It is expected that competition in the AI industry will become more intense in the future.

5. Bitcoin price breaks through the historical high of 110,000 USD, the poor performance of altcoins triggers reflection in the industry.

The price of Bitcoin has surpassed $110,000 this week, setting a new historical high. In stark contrast, the overall performance of altcoins has been poor, prompting reflections on the development model of cryptocurrencies both within and outside the industry.

Analysts point out that Bitcoin, as the flagship of cryptocurrencies, has seen its price increase mainly due to the continuous inflow of institutional funds. In contrast, altcoins struggle to attract funding to drive price increases due to a lack of real application scenarios.

In addition, the previous model of artificially creating hype through means such as "growth hacking" has also been questioned. The behavior of founders and investors cashing out significantly after a listing on the exchange has severely harmed the interests of retail investors.

Therefore, some analyses suggest that the cryptocurrency industry needs to truly shift towards building valuable applications and products, rather than simply relying on hype. Only projects with actual use cases can gain long-term development momentum.

At the same time, the increasingly clear regulations will force the industry to develop in a compliant and transparent direction, further compressing the space for excessive speculation and hype. In the future, the cryptocurrency industry is expected to welcome a more rational and healthy development model.

2. Industry News

1. Bitcoin hits a new high, driven by institutional investors.

Bitcoin has risen by 1.86% in the past 24 hours, currently priced at $110,000, once again setting a new historical high. Analysts believe that this increase is mainly driven by institutional investors. BlackRock's Bitcoin futures ETF product has seen net inflows for 30 consecutive days, indicating a sustained growth in institutional demand for Bitcoin.

At the same time, the Nasdaq 100 ETF product TQQQ has seen continuous outflows of funds, indicating a divergence in investor sentiment, with some capital shifting from technology stocks to crypto assets. In the context of an uncertain global economic and policy environment, cryptocurrencies like Bitcoin are demonstrating relatively mature performance.

Nevertheless, investors still need to be cautious of the risk of short-term pullbacks. The key resistance level is above $110,000, and once breached, it could further drive up the price of Bitcoin. However, if it fails to hold the support level of $107,500, Bitcoin may face further downward pressure.

Overall, the entry of institutional investors has brought new upward momentum to Bitcoin. However, investors need to closely monitor changes in technical and fundamental aspects and cautiously manage risks.

2. The negative correlation between Ethereum and the US Dollar Index has strengthened, with BlackRock's investment boosting upward expectations.

Ethereum has risen by 2.66% in the past 24 hours, currently quoted above $2500. Analysts point out that the negative correlation between Ethereum and the US dollar index is strengthening, and if this historical pattern repeats, Ethereum may usher in a new round of bullish trend.

In addition, the renowned investment firm Blackstone recently invested $52.8 million in the Ethereum ecosystem, further boosting market expectations for the rise of Ethereum. As a "pioneer" of cryptocurrencies, the price trend of Ethereum often influences the overall market sentiment.

However, investors should also be wary of the challenges faced by Ethereum. The issues of network congestion and high transaction fees have persisted, and the rise of other public chains has also put some pressure on Ethereum. If Ethereum cannot timely address the scalability issues, its dominant position may be impacted.

Overall, the negative correlation between Ethereum and the US dollar index has strengthened, and the influx of institutional funds has added momentum to its bullish outlook. However, investors should also pay attention to its technological development progress and carefully assess potential risks.

3. The Solana ecosystem continues to heat up, with a significant increase in USDC minting.

The Solana ecosystem continues to heat up, with a significant increase in the minting volume of USDC on the Solana chain. Data shows that USDC Treasury has minted an additional 250 million USDC on the Solana chain, indicating that the Solana network is attracting more stablecoin liquidity.

As an emerging high-performance public chain, Solana's advantages of low transaction fees and high throughput have attracted many DeFi and NFT projects to settle in. With the ecosystem becoming increasingly prosperous, the transaction volume and user activity on the Solana network are also continuously increasing.

However, the development path of Solana has not been smooth sailing. Network congestion and downtime issues occur from time to time, and its security has also been questioned. If Solana cannot resolve these issues in a timely manner, its development prospects may be affected.

Overall, the continued warming of the Solana ecosystem has brought new development momentum. However, investors also need to pay attention to its technological advancements and ecological construction, and cautiously assess the risk-reward ratio.

4. XRP legal victory sparks heated discussions on Layer 1, new public chain prospects draw attention.

XRP has won a victory in its lawsuit against the U.S. Securities and Exchange Commission, and this news has once again sparked heated discussions in the cryptocurrency community about Layer 1 public chains. Analysts believe that while traditional networks like Ethereum and XRP lead the narrative, new Layer 1 public chains will also play an important role.

In fact, emerging public chains such as Solana, Aptos, and Sui have developed rapidly in the past year, attracting a large amount of funding and projects. They all have different focuses and innovations in terms of performance, security, and ecological construction.

However, the new public chains also face challenges. They need to compete with established public chains like Ethereum in terms of security, degree of decentralization, and ecological development. At the same time, competition among new public chains is becoming increasingly fierce.

Overall, the outcome of the XRP case has brought new development opportunities to the cryptocurrency industry. Investors need to closely monitor the technological progress and ecosystem development of different public chains and cautiously seize investment opportunities.

5. AI concept cryptocurrencies continue to strengthen, Hyperliquid reaches an all-time high

In the context of a general surge in the cryptocurrency market, AI concept coins have performed particularly well. Data shows that the AI sector has risen by 3.8% in the past 24 hours, with Hyperliquid reaching a historic high.

The continuous strengthening of AI concept cryptocurrencies is, on one hand, due to the broad application prospects of artificial intelligence technology in the cryptocurrency field, and on the other hand, influenced by market speculation. Analysts point out that the enthusiasm of investors for AI concept cryptocurrencies is partly based on optimistic expectations for future potential, and there is also a certain degree of speculation.

However, the development prospects of AI concept coins are not all smooth sailing. They need to continuously break through in terms of security, scalability, and practicality to truly achieve large-scale application. At the same time, changes in regulatory policies may also impact their development.

Overall, the continued strength of AI concept cryptocurrencies reflects the market's enthusiasm for this emerging technology. However, investors also need to view it rationally, carefully assess the risk-reward ratio, and avoid blindly following trends.

3. Project News

1. Sui Network: The Rise of the Move Ecosystem New Star

Sui Network is a brand new blockchain project created by engineers who were involved in the Diem project. It utilizes the Move programming language and a new parallel execution engine, aiming to build a high-performance and scalable blockchain platform.

Latest updates: The Sui Network officially launched its mainnet in May of this year and issued its native token SUI. After the mainnet launch, the Sui ecosystem rapidly developed, attracting numerous DeFi, NFT, and GameFi projects. Among them, the DeFi protocol Cetus and the NFT market Sui Marketplace have garnered significant attention. At the same time, Sui also launched the SuiPlay gaming platform to provide infrastructure support for GameFi projects.

Market Impact: As a new star project in the Move ecosystem, the emergence of Sui Network has injected new vitality into the entire Move ecosystem. Its high performance and scalability are expected to solve the congestion and high transaction fee issues faced by established public chains like Ethereum, providing better infrastructure support for applications such as DeFi, NFTs, and GameFi. In addition, the success of Sui will further promote the development and application of the Move programming language.

Industry feedback: Industry insiders are generally optimistic about the development prospects of Sui Network. Renowned analyst Lark Davis stated: "Sui Network is one of the most promising projects in the Move ecosystem, and its high performance and scalability will attract more DeFi, NFT, and GameFi projects to settle in." Meanwhile, a research report by Delphi Digital also pointed out that Sui Network is expected to become a leader in the Move ecosystem.

2. Aptos: The New Star of Blockchain in the Former Metaverse Project

Aptos is an emerging blockchain project created by former employees of Meta(Facebook), aimed at building a high-performance, secure, and user-friendly blockchain ecosystem.

Latest updates: Aptos officially launched its mainnet in March this year, issuing its native token APT. After the mainnet launch, the Aptos ecosystem rapidly developed, attracting numerous DeFi, NFT, and Web3 applications. Among them, the DeFi protocol Aries and the NFT marketplace Topaz on Aptos have received significant attention. At the same time, Aptos also launched Move VM, providing developers with a more user-friendly development environment.

Market Impact: As a project created by former Meta employees, Aptos has inherent advantages in performance and security. Its high performance and scalability are expected to address the congestion and high transaction fee issues faced by established public chains like Ethereum, providing better infrastructure support for DeFi, NFTs, and Web3 applications. Furthermore, the success of Aptos will also further promote the development and application of the Move programming language.

Industry feedback: Industry insiders are generally optimistic about the development prospects of Aptos. The well-known investment firm Andreessen Horowitz stated: "Aptos is a very promising project, and its high performance and security will attract more applications to settle in." Furthermore, a research report from Messari pointed out that Aptos is expected to become one of the leaders in the Move ecosystem.

3. Hyperliquid: AI-driven decentralized exchange

Hyperliquid is an AI-based decentralized exchange designed to provide users with an intelligent trading experience.

Latest Updates: Hyperliquid recently launched an AI-based smart trading assistant that provides personalized trading advice and execution based on users' risk preferences and trading strategies. At the same time, Hyperliquid has also introduced a series of new trading pairs and liquidity mining activities, attracting a large number of users and capital inflows.

Market Impact: As an AI-based decentralized exchange, the emergence of Hyperliquid brings a new experience to cryptocurrency trading. Its smart trading assistant helps users better manage risks and improve trading efficiency. At the same time, Hyperliquid's decentralized model also contributes to enhancing the security and transparency of the exchange.

Industry Feedback: Industry insiders have praised Hyperliquid's innovative model. Renowned investor Andreessen Horowitz stated: "Hyperliquid's AI-driven model brings a whole new experience to cryptocurrency trading, and this innovation is expected to drive the development of the entire industry." CoinDesk's report also pointed out that the emergence of Hyperliquid could lead to more exchanges adopting AI technology.

4. Worldcoin: Identity verification-based cryptocurrency project

Worldcoin is a verification-based cryptocurrency project aimed at providing a fair opportunity for cryptocurrency distribution to everyone globally.

Latest updates: Worldcoin recently launched a device called Orb, designed to verify users' identity information. Users can receive a certain amount of Worldcoin tokens simply by scanning their eyeballs with the Orb. This innovative method of identity verification has attracted widespread attention. At the same time, Worldcoin also announced that it will conduct a token issuance in the coming months.

Market Impact: As an identity verification-based cryptocurrency project, the emergence of Worldcoin provides a brand new solution for the fair distribution of cryptocurrency. Its innovative verification method is expected to address the unfairness inherent in traditional cryptocurrency distribution, offering more people the opportunity to participate in the cryptocurrency economy.

Industry feedback: Industry insiders are cautiously optimistic about Worldcoin's innovative model. Notable investor Naval Ravikant stated: "The verification method of Worldcoin is indeed very creative, but it still needs further improvement in terms of privacy and security." CoinDesk's report also pointed out that the success of Worldcoin will depend on whether it can gain sufficient user recognition and participation.

5. Virtuals Protocol: AI-driven virtual world

Virtuals Protocol is an AI-based virtual world project aimed at providing users with an immersive virtual experience.

Latest Updates: Virtuals Protocol recently launched an AI-based virtual assistant that can generate personalized virtual scenes and characters based on user preferences and needs. At the same time, Virtuals Protocol has also introduced a series of new virtual worlds and games, attracting a large number of users to participate.

Market Impact: As an AI-based virtual world project, the emergence of Virtuals Protocol brings a new experience to the metaverse. Its AI-driven virtual assistant can provide users with a more personalized and immersive virtual experience, which is expected to promote the development and popularization of the metaverse.

Industry Feedback: Industry insiders have praised the innovative model of Virtuals Protocol. Notable investor Andreessen Horowitz stated: "The AI-driven model of Virtuals Protocol brings a whole new experience to the metaverse, and this innovation is expected to drive the development of the entire industry." Additionally, a report from CoinDesk pointed out that the emergence of Virtuals Protocol may trigger more metaverse projects to adopt AI technology.

4. Economic Dynamics

1. Federal Reserve's Kashkari: Trade policy changes bring uncertainty

Economic Background: The U.S. economy has maintained moderate growth over the past year, but high inflation rates have put pressure on the federal government's monetary policy. The latest data shows that the core Personal Consumption Expenditures (PCE) price index rose by 4.7% year-on-year in April, exceeding the Federal Reserve's target level of 2%. The unemployment rate hovers at a low of 3.4%, reflecting a continued tightening in the labor market.

Important Event: U.S. President Trump recently announced a 50% tariff on European Union goods, triggering a trade dispute. This move aims to alleviate the U.S. trade deficit but may also provoke retaliatory measures from the EU. Trump later agreed to extend the implementation deadline to July 9 to give both sides more time for negotiations.

Market reaction: Trump's tariff threats have heightened uncertainty in the market. Investors are concerned that the trade dispute may escalate, thereby affecting global economic growth and corporate profits. U.S. stocks briefly fell after the news was announced but rebounded after Trump postponed the implementation deadline.

Expert Opinion: Fed Governor Kashkari said the Trump administration's shift in trade policy brings uncertainty to interest rate action ahead of September. "This uncertainty could weigh on economic activity and create challenges for us because we are not sure how things will play out and therefore where monetary policy should go," he said. Kashkari and other officials agree that the threshold for rate cuts in the short term remains high. However, if the U.S. and other countries reach a trade deal, more clarity will be provided.

2. The Renminbi exchange rate strengthens, experts analyze the reasons and trends.

Economic background: The RMB has continued to strengthen against the US dollar recently, with a cumulative appreciation of more than 2% since the end of April. This trend is related to the continued decline of the dollar index. The latest data showed that China's GDP grew 4.5% year-on-year in April, slightly lower than the 4.8% growth in the first quarter, but the overall economy maintained steady growth. Inflation is around 2% and the job market is stable.

Important events: Recently, the domestic implementation of more proactive macro policies has strengthened the resilience of the domestic macro economy against external fluctuations, providing intrinsic support for the RMB exchange rate. At the same time, the market's pessimistic expectations regarding the increase in the U.S. government's fiscal deficit and debt have intensified, leading to a significant decline in the dollar index again recently, which has driven the general appreciation of non-U.S. currencies, including the RMB.

Market reaction: The strengthening of the RMB exchange rate is favorable for the export competitiveness of Chinese enterprises, but it may also exacerbate the pressure of capital outflow. The RMB central parity against the US dollar is reported at 7.0498, a decrease of 122 points compared to the previous trading day. The offshore RMB spot exchange rate against the US dollar has also risen.

Expert opinion: Wang Qing, chief macro analyst of Oriental Jincheng, analyzed that there are two main factors involved in the recent strengthening of the RMB exchange rate: first, the depreciation of the US dollar has promoted the passive appreciation of the RMB against the US dollar; Second, China has stepped up the implementation of more active and promising macroeconomic policies, which has strengthened the resilience of the domestic macroeconomy to resist external fluctuations. Wang Qing judged that in the future, the renminbi is more likely to have a two-way fluctuation process opposite to the trend of the US dollar, but the fluctuation range is relatively small, and the trend of the renminbi will be more stable than that of other major currencies.

3. Japan allocates $6.3 billion to counter U.S. tariff threats

Economic Background: The Japanese economy began to recover in 2023, but the growth momentum remains insufficient. Recent data shows that Japan's GDP is expected to grow by 1.6% year-on-year in the first quarter of 2025, which is lower than expected. The inflation rate is around 2%, and the job market remains stable. The Japanese government has been promoting structural reforms to boost economic vitality.

Important event: U.S. President Trump threatens to impose high tariffs on Japanese cars and other products to reduce the bilateral trade deficit. This move could severely impact Japan's export industry, particularly the automotive manufacturing sector. In response to this challenge, the Japanese government has decided to allocate $6.3 billion for emergency assistance.

Market reaction: Trump's tariff threats have increased uncertainty for Japanese companies. The Tokyo stock market experienced a brief decline after the announcement. The yen has also fluctuated against the US dollar. Japanese automakers are facing rising cost pressures, which could affect their competitiveness in the US market.

Expert view: A Japanese government spokesperson said the funds will be used to reduce utility costs and help businesses, especially in the automotive industry. He added that if the U.S. and other countries reach a trade deal in the coming months, "that should provide a lot of clarity that we're looking for." "The widespread tariffs are seen as pushing up inflation in the U.S., while dragging down economic growth as businesses reduce investment and households control spending.

4. Global long-term bond yields soar, institutions warn of risks.

Economic Background: Long-term government bond yields in major global economies have continued to rise in recent weeks. This trend reflects investors' concerns about inflation prospects and expectations for central bank interest rate hikes. The latest data shows that the US PCE price index rose 4.4% year-on-year in April, reaching a 40-year high.

Important events: Last week, the 20-year government bond auctions in the United States and Japan both cooled, with a significant decline in investor demand for long-term bonds. This has led to the continuous rise in yields on long-term bonds in both countries. Several institutions have warned that the long-term bond markets in developed countries are facing vulnerabilities, with increasing bond supply but decreasing buyers.

Market reaction: Global bond market volatility has intensified. The yield on the US 10-year Treasury bond has surpassed 3.1%, reaching a new high since December 2018. The yield on Japan's 10-year government bond has also risen to a high of 0.25%. Bond prices have fallen, and investors are accelerating their exit from long bond positions.

Expert Opinion: Goldman Sachs analysts state that the bond market is facing a "structural supply shock" as major central banks are reducing their bond purchasing programs. UBS warns that the bond market is in a "fragile new normal." Citigroup analysts believe that rising bond yields will exacerbate the drag on the economy. This situation is unlikely to improve rapidly in the short term, so the yields on long-term government bonds may continue to rise.

5. Federal Reserve Chairman Powell is cautiously optimistic, focusing on inflation and employment data.

Economic Background: The US economy began to recover in 2023, but inflation rates remain high. Latest data shows that the core PCE price index rose 4.7% year-on-year in April, above the Federal Reserve's target level of 2%. The job market remains robust, with the unemployment rate staying low at 3.4%.

Important event: Federal Reserve Chairman Jerome Powell delivered a speech at Princeton University's graduation ceremony. He did not make specific comments on the economic and policy outlook but emphasized the importance of inflation and employment data. Powell stated that the Federal Reserve will continue to closely monitor this data to determine whether further interest rate hikes are necessary.

Market Reaction: Powell's speech is seen as a cautiously optimistic signal. Investors expect the Federal Reserve to raise interest rates again in June, but may pause further hikes afterwards to assess economic trends. U.S. stocks rose slightly after Powell's speech.

Expert Opinion: Goldman Sachs analysts stated that Powell's speech "did not provide any new policy clues," but emphasized the importance of inflation and employment data. They expect that if inflation data continues to be weak, the Federal Reserve may pause interest rate hikes in September. UBS analysts, on the other hand, believe that Powell's remarks are "somewhat dovish," reflecting the Federal Reserve's cautiously optimistic attitude towards the economic outlook.

5. Regulation & Policy

1. The American banking industry group calls for the repeal of cybersecurity incident disclosure rules.

In July 2023, the U.S. Securities and Exchange Commission ( SEC ) issued the "Cybersecurity Risk Management Rules," requiring publicly traded companies to disclose cybersecurity incidents within four days. However, this regulation was met with opposition from U.S. banking groups.

Led by the American Bankers Association, five major banking groups sent a joint letter to the SEC on May 22 demanding that the disclosure requirement be lifted. Participating institutions include the Securities Industry and Financial Markets Association, the Bank Policy Research Institute and other institutions. Banking groups point out that the rule is in direct conflict with confidential reporting requirements to protect critical infrastructure, could hinder incident response and enforcement actions, and create market disruption. In particular, they called for the removal of "Section 1.05" on Form 8-K, arguing that the existing material disclosure framework is sufficient to protect the interests of investors.

This rule also applies to listed cryptocurrency companies. Earlier this month, Coinbase faced at least seven lawsuits due to the disclosure of a user data breach, and the company refused to pay a $20 million ransom, with estimated potential losses reaching $400 million. If the rule is canceled, relevant companies will have more flexibility in the timing of event disclosures.

Insiders have differing opinions on this matter. Supporters believe that timely disclosures help improve transparency and accountability, while critics worry that overly strict regulations may affect the efficiency of companies in responding to cyberattacks. The SEC needs to seek a balance between investor interests and corporate operations.

2. The U.S. Senate advances the "Stablecoin Unified Standards Protection Act" causing controversy.

The U.S. Senate is advancing the "Stablecoin Uniform Standards Protection Act" ( GENIUS Act ), aimed at establishing a unified standard for stablecoin regulation. The bill was jointly introduced by Senators Kirsten Gillibrand and Rave Glaimio.

As the first comprehensive regulatory framework for stablecoins in the United States, the GENIUS Act will empower the Securities and Exchange Commission ( SEC ) and the Commodity Futures Trading Commission ( CFTC ) to regulate stablecoin issuers. The bill requires stablecoin issuers to publish reserve audit reports monthly and restricts their investment scope. In addition, stablecoin issuers must hold reserves equivalent to U.S. dollars as support.

The introduction of the bill aims to address the potential systemic risks posed by stablecoins. In May 2022, the collapse of the Terra ecosystem sparked widespread attention to the regulation of stablecoins. Supporters believe that the GENIUS Act will bring transparency and trust to the stablecoin market.

However, the bill has also sparked criticism and concerns both within and outside the industry. Some question whether the bill will stifle innovation and worry about the risks that tech giants entering the banking sector may bring. Experts warn that if not properly regulated, the GENIUS Act could lead to a "slow-motion train wreck."

There are also differences within the Democratic Party, with some individuals advocating for abandoning the opposition stance. The complexity and far-reaching impact of regulating stablecoins require all parties to weigh the pros and cons and reach a balance.

3. The Japanese government plans to use 900 billion yen to respond to the impact of U.S. tariffs.

On May 26, according to a report by Kyodo News, the Japanese government plans to use 900 billion yen (, approximately 6.3 billion USD ) of national funds to implement an emergency rescue plan to mitigate the impact of U.S. tariffs.

According to Kyodo News, in order to fund a package plan that includes lowering utility costs and providing financial assistance to small businesses, the government plans to tap into budget reserves and the existing budget. This move aims to help Japanese companies and consumers cope with potential import tariffs that may be imposed by the Trump administration.

Since late April, risk assets have been steadily rising, but Trump's sudden proposal to raise tariffs on EU goods to 50% has disrupted market calm. Although he later extended the implementation deadline for the tariffs to July 9, the market briefly stabilized; this move highlights that policy risks remain disruptive.

At the same time, inflation remains a macro focus. The PCE data on Friday will be an important basis for the direction of Federal Reserve policy. Although oil prices have declined, congestion in European ports is spilling over to the world, which may drive up shipping costs and trigger new inflationary pressures.

Wang Qing, chief macro analyst at Dongfang Jincheng, analyzed that the recent strengthening of the RMB exchange rate is mainly driven by two factors: first, the depreciation of the US dollar has led to a passive appreciation of the RMB against the dollar; second, the domestic implementation of more proactive macro policies has enhanced resilience against external fluctuations. Wang Qing predicts that in the future, the RMB is more likely to exhibit two-way fluctuations opposite to the US dollar trend, but the amplitude of fluctuations will be relatively small, and the overall trend will be more stable.

4. US OCC: Banks may legally engage in activities related to crypto assets.

On May 7, the U.S. Office of the Comptroller of the Currency (OCC) clearly stated that banks can outsource cryptocurrency activities to third parties, including custodial and execution services.

The OCC, by issuing Interpretive Letter No. 1183, has clarified that national banks and federal savings associations may legally engage in cryptocurrency-related activities, provided they meet relevant regulatory and risk management requirements. This includes offering cryptocurrency custody services, participating in stablecoin issuance and settlement, and acting as nodes in distributed ledger networks. The letter rescinds the requirement in Interpretive Letter No. 1179 issued in 2021, which mandated that banks obtain written approval from the OCC before engaging in such activities, thereby streamlining the process for banks to participate in cryptocurrency business.

As long as everything continues to meet the safety and soundness requirements of regulators, the OCC will grant banks more freedom in cryptocurrency. This initiative aims to promote banking innovation and meet the growing demand from customers for cryptocurrency asset services.

The policy has received widespread welcome from the cryptocurrency industry. Industry professionals believe that it will help promote the integration of crypto assets into the traditional financial system and encourage participation from institutional investors. At the same time, there are concerns about the risks of banks engaging in cryptocurrency business, calling for the OCC to strengthen regulation.

Overall, this move by the OCC signifies that the U.S. government is gradually accepting crypto assets and clearing obstacles for their development within the traditional financial system. However, while promoting innovation, how to balance risks remains a problem that needs to be addressed.