Ethereum News Today: Ethereum Powering Fed’s Push for Future Payment Systems

The Federal Reserve is set to host a conference on October 21, focusing on innovations in payment systems, including stablecoins, decentralized finance (DeFi), artificial intelligence (AI), and tokenization. The event aims to evaluate emerging technologies and their potential to improve the payment infrastructure, with Governor Christopher Waller emphasizing the importance of understanding the opportunities and challenges posed by new developments in the sector [1]. The conference will provide a platform for stakeholders to share insights and ideas, with discussions expected to cover the integration of traditional finance with decentralized models and the tokenization of financial products [2]. As part of its ongoing efforts to explore technological advancements, the central bank has already begun examining the use of tokenization, smart contracts, and AI in payments systems [1].

Stablecoins, a focal point of the conference, have seen significant growth in recent years. The stablecoin market cap has more than doubled since 2023, reaching $280 billion, with forecasts suggesting it may reach $2 trillion by 2028 [3]. Over half of these stablecoins are built on the Ethereum blockchain, which has established itself as a dominant platform for smart contract applications. This dominance is supported by regulatory developments such as the GENIUS Act, signed into law in July 2025, which provides a federal framework for stablecoin issuance and ensures transparency through reserve disclosures and one-to-one backing with U.S. dollars or Treasurys [3]. The Act also removes stablecoins from securities regulation, making them more attractive for institutional adoption.

Beyond stablecoins, the tokenization of real-world assets (RWAs) is another area of rapid growth. According to analytics firm RWA.xyz, the value of tokenized real-world assets has surged 413% since early 2023, rising from $5.2 billion to $26.7 billion [3]. Major financial institutions, including BlackRock and Franklin Templeton, have entered the space, issuing tokenized assets alongside crypto-native platforms. Ethereum remains at the forefront, hosting over $7.6 billion in tokenized RWAs and capturing 52% of the market. The CLARITY Act, currently under consideration in the U.S. Senate, may further accelerate this trend by establishing a legal framework for “mature blockchains,” which would grant Ethereum and other compliant platforms a clearer regulatory environment for tokenizing a wide range of financial instruments [3].

Meanwhile, global regulators are reevaluating their approach to stablecoins in response to U.S. developments. China, which has historically maintained a strict stance on cryptoassets, is reportedly considering a framework for yuan-backed stablecoins, potentially piloting the initiative in Hong Kong and Shanghai [4]. This move reflects a broader strategy to counter dollar dominance and develop an alternative to U.S. and European payment systems, particularly as geopolitical tensions with Russia persist. South Korea and the European Union are also adjusting their regulatory strategies. South Korea has accelerated its stablecoin legislation, with plans to introduce draft laws by October, while the EU is advancing its digital euro project, with the European Central Bank exploring the use of public blockchains like Ethereum for its digital currency [4].

Domestically, Wyoming has launched the first state-issued, USD-backed stablecoin, the Frontier Stable Token (FRNT), operational on multiple blockchains and available through Kraken and Rain [4]. The token aligns with the GENIUS Act’s requirements, including non-interest-bearing features and full backing by U.S. dollars and Treasurys. While no other U.S. states have announced similar projects, Wyoming’s initiative may set a precedent for further innovation in state-level stablecoin issuance.

Source:

[1] https://cryptobriefing.com/payments-innovation-conference-fed/

[2] https://www.chaincatcher.com/en/article/2203041

[3] https://cointelegraph.com/news/ether-powered-by-rwa-tradfi-as-wall-street-piles-in

[4] https://www.elliptic.co/blog/crypto-regulatory-affairs-stablecoin-and-digital-payments-work-accelerates-following-us-genius-act