KuCoin Ventures said in its latest weekly report that the overlap between traditional finance and crypto is moving past product design and deeper into financial infrastructure. The firm highlighted three separate developments: the U.S. crypto market structure bill CLARITY Act reaching a new procedural stage, Nasdaq’s plan to invest $100 million in Payward, the parent company of Kraken, and Tether’s launch of a private credit fund with U.K. asset manager Fasanara Capital. In the report’s view, the three items map to the rule, asset and credit layers of on-chain finance, showing how discussion in the sector is shifting from how assets are issued and traded to how a fuller market structure gets built.
From products to market rails
On Sept. 10, Nasdaq Ventures said it plans to invest $100 million in Payward, the parent company of Kraken, deepening the tokenized equity partnership the two sides began in March this year. KuCoin Ventures said the next phase will continue linking Nasdaq Equity Tokens, or NETs, with the Payward xStocks ecosystem, while Payward will also adopt Nasdaq’s market surveillance technology. Nasdaq expects NETs to launch in the second quarter of 2027. The cooperation is also set to cover global distribution, trading, and post-trade processing and settlement for tokenized equities.
The report said many earlier tokenized stock products centered on putting the price exposure of an underlying asset on-chain. Nasdaq’s NETs, by contrast, put more weight on preserving existing rights and protections for issuers and investors while tying regulated capital markets to on-chain trading venues. KuCoin Ventures said Nasdaq is also bringing traditional capital-market capabilities in areas such as market surveillance, governance, and post-trade processing and settlement.
Stablecoins are also moving further into traditional credit markets, according to the report. On Sept. 9, Tether and Fasanara Capital announced StableFund, an evergreen private credit fund. The two parties are providing a combined $400 million in anchor capital and plan to attract as much as $3 billion in third-party institutional money. Fasanara will handle investment management through its fintech credit network spanning more than 60 countries, allocating to short-duration, asset-backed credit. Tether will act as co-sponsor, financing opportunity originator and adviser, looking for financing opportunities tied to USDT while providing stablecoin infrastructure including fund in-and-out channels, treasury management and settlement rails.
KuCoin Ventures said this suggests stablecoin use cases are extending beyond payments and trading into capital allocation and the credit chain. In earlier stages, stablecoins mainly solved how money could move faster and with less friction across platforms and across borders. StableFund is trying to place that settlement capability inside private credit fundraising, lending and cash-management workflows. The report said Tether is actively connecting its stablecoin network, funding channels and cross-border settlement capacity with real-world credit assets.
Taking the developments together, the firm said the focus in RWA and on-chain finance is expanding from standalone tokenization projects to issuance and registration, trading and liquidity, settlement, credit, and the middle-layer infrastructure that connects traditional finance with on-chain markets. In KuCoin Ventures’ view, what matters more is which platforms can enter existing institutional workflows and prove that on-chain technology can improve capital efficiency, distribution efficiency or settlement efficiency.
Inflation, oil and the September Fed meeting
On macro markets, KuCoin Ventures said August U.S. inflation data revived expectations for a September rate hike. Producer prices rose 0.4% month on month and 5.4% year on year, with energy costs the main driver. Consumer prices then came in up 0.4% month on month and 3.4% year on year, while core CPI rose 0.3% month on month and 2.4% year on year. At the same time, conflict in the Middle East pushed crude oil back above $100, raising concerns that energy prices could pass through into goods, transport and services.
By the weekend, CME FedWatch Tool showed the market assigning about an 86.5% probability to a 25-basis-point Federal Reserve hike in September, up sharply from roughly 30% a week earlier. The 10-year U.S. Treasury yield briefly approached 5%, a high for the period since 2023. KuCoin Ventures said the market debate over whether the Fed will hike in September has narrowed considerably, and attention is moving to whether tightening would continue after that move.
The report said the case for a string of consecutive hikes is less clear than the case for a single move. U.S. nonfarm payrolls increased by about 162,000 in August, which did not point to a clear loss of labor-market momentum, while wage growth still did not show a classic overheating pattern. At the same time, U.S. government debt has exceeded $40 trillion, and long-end yields are already tightening financing conditions for companies and households. KuCoin Ventures added that heavy debt-financing demand tied to AI data-center expansion is increasing the pressure that high rates place on technology companies’ cash flow and capital-expenditure returns. In that setup, a September hike looks like the high-probability outcome, but whether it turns into a continuing hiking cycle still depends on whether oil, jobs and core inflation remain firm.
The report also said Middle East developments are amplifying inflation risk. Houthi forces attacked Saudi energy facilities, transport through the Strait of Hormuz remained constrained, and Saudi Arabia’s east-west pipeline used to bypass the strait was shut after a drone attack. That combination has raised concern about further supply disruptions. Brent crude rose about 8% to 9% on the week and at one point neared $110 a barrel, while WTI also returned above $100. Talks between Iran and Gulf states on the Strait of Hormuz that had been scheduled for Sept. 14 were later delayed, which the report said means the geopolitical risk premium may not fade quickly in the near term.
Gold remained caught between high inflation and high real rates. Spot gold rebounded to about $4,363 an ounce on Friday but was still down about 1.5% for the week. KuCoin Ventures said fiscal, geopolitical and inflation risks continue to offer medium- to long-term support, but once the 10-year Treasury yield moved close to 5%, the opportunity cost of holding non-yielding assets rose again and rate pressure retook the lead in the short run.
U.S. equities pulled back over the week, with the S&P 500, Nasdaq Composite and Dow Jones Industrial Average down about 0.8%, 0.7% and 1.6%, respectively. The report said higher oil prices and rising long-term yields weighed on valuations, though corporate earnings still offered support and broad-based liquidation across risk assets had not taken hold.
The AI segment added a new sentiment variable. KuCoin Ventures said the heads of Anthropic, OpenAI and xAI unusually aligned over the weekend in backing a slower pace for frontier-model development, sparking concerns about the growth rate of AI compute investment. For now, the report said, this remains more of an expectations risk. It would need to show up in delayed model releases or lower capital-expenditure guidance before materially affecting demand for GPUs, HBM and servers. Even so, Japan and South Korea have sizable exposure to the AI hardware chain, so policy or industry-expectation shifts could amplify short-term moves in companies such as Samsung Electronics, SK Hynix and SoftBank.
Crypto markets and ETF flows diverged again
Crypto assets were broadly under pressure last week. Bitcoin fell from around $80,000 at the start of the week to near $77,000, down about 3% to 4% on the week, according to the report. Ether held mostly in the $2,450 to $2,550 range and outperformed Bitcoin on a relative basis. Higher oil prices, inflation readings and Treasury yields together raised the dollar funding cost backdrop for crypto, but Ether retained relative resilience with help from ETF inflows.
Citing SoSoValue data, KuCoin Ventures said that because U.S. markets were closed on Sept. 7 for Labor Day, spot Bitcoin ETFs in the U.S. posted combined net outflows of about $463 million across the four trading days from Sept. 8 through Sept. 11, ending a three-week run of net inflows. ARKB and GBTC saw net outflows of about $234 million and $129 million, respectively, while IBIT and FBTC also shifted into net outflows.
Spot Ether ETFs, by contrast, recorded about $197 million in net inflows over the same period, extending their positive streak to a fourth straight week. On Sept. 11 alone, net inflows reached about $216 million, with BlackRock’s ETHA providing the main incremental demand and offsetting redemptions seen over prior trading days.
KuCoin Ventures said the split between Bitcoin and Ether ETFs indicates that institutional money is not leaving the crypto market altogether, but is still reallocating across assets. The report added that relative demand for Ether exposure is improving, yet aggregate stablecoin supply has not expanded in step. For that reason, the current pattern looks closer to structural rotation inside institutional portfolios than to a fresh market-wide liquidity cycle.
Stablecoins stayed flat overall while USDe expanded
DeFiLlama data cited in the report showed total stablecoin market capitalization at about $305.1 billion. Over the past seven days, the figure was roughly flat and slipped about 0.12%; over the past 30 days, it was still up about 1%. USDT held a market share of around 60.1%. KuCoin Ventures said that means the earlier recovery in overall stablecoin growth has slowed for now, and ETF flow changes have not translated into broad on-chain dollar expansion.
Among the top 10 stablecoins, USDT was largely flat and USDC fell about 0.39% on the week. USDS and PYUSD declined about 2.8% and 2.7%, respectively. The more notable move came from USDe, which rose about 6.5% week on week to roughly $4.6 billion, while USD1 and USDG also posted modest gains. KuCoin Ventures linked USDe’s expansion to a pickup in demand for yield, noting that yields tied to sUSDe remained around 4.5%, prompting some capital to increase allocations to yield-bearing synthetic dollars.
Even so, the report said stablecoins still look like a market dominated by rotation among products rather than by strong growth in the total base. Yield-focused products such as USDe are gaining assets, but mainstream USDC is still shrinking modestly, a sign that the on-chain dollar base has not entered a fresh broad uptrend.
What the market is watching this week
KuCoin Ventures said the market this week will focus on the September Federal Reserve meeting, Bank of Japan policy and developments around the Strait of Hormuz. With September hike odds already priced above 80%, the FOMC’s guidance on the path for the rest of the year may matter more for risk assets than the single hike itself.
- Sept. 16: The U.S. will release August retail sales data. The report said this will be used to judge whether high oil prices and high rates are beginning to weigh on demand after rate-hike expectations climbed sharply.
- Sept. 17: The Federal Reserve will publish its FOMC rate decision, followed by a press conference from Waller. The market is currently pricing roughly an 86% probability of a 25-basis-point increase. Focus is expected to move from whether the Fed hikes to the dot plot, the possibility of another increase later this year, and Waller’s reading of oil prices and long-end yields.
- Sept. 18: The Bank of Japan will announce its rate decision. KuCoin Ventures said the market broadly expects a 25-basis-point increase to 1.25%. If Japan sends a stronger signal that policy normalization is accelerating, a firmer yen and capital returning to Japan could further affect global carry trades and disturb liquidity for tech stocks and crypto assets.
On geopolitics, the report noted that the Strait of Hormuz talks between Iran and Gulf states that had been planned for Sept. 14 have been delayed, with no new date announced. With crude back above $100, progress or the lack of it in those talks could directly shape global inflation expectations and pricing around the Fed’s next steps.
Primary market funding favored tokenization, stablecoin payments and institutional tools
Drawing on broad funding data from CryptoRank and DeFiLlama, KuCoin Ventures said primary-market financing improved from the previous week, though capital remained heavily concentrated in tokenization, stablecoin payments and institutional infrastructure rather than generalized on-chain applications.
Nasdaq Ventures’ planned $100 million strategic investment in Payward stood out as one of the week’s representative deals. The two companies plan to expand cooperation around trading, distribution and post-trade infrastructure for tokenized equities, and Kraken will adopt Nasdaq’s market surveillance technology. KuCoin Ventures said the notable part is not simply equity investment in a crypto exchange parent, but the direct entry of a traditional securities exchange operator into tokenization infrastructure. That, the report said, shows competition between TradFi and crypto moving from the question of whether assets go on-chain to the integration of trading, liquidity, surveillance and settlement systems.
In stablecoin payments, Latitude raised $35 million in a Series A round led by Oak HC/FT, with participation from NEA and Coinbase Ventures. The report said Latitude connects stablecoins with bank accounts, mobile wallets and local payment networks in different countries, with its core value centered on solving the last-mile problem between on-chain dollars and real-world payments and local-currency settlement.
In AI-plus-crypto, Agentum raised $7 million. KuCoin Ventures described the company as building identity, custody, reputation and on-chain settlement infrastructure for commercial activity carried out by AI agents. Compared with the broader AI agent narrative that circulated earlier, the report said capital still prefers infrastructure that can address payment, trusted execution and settlement.
Overall, KuCoin Ventures said the primary market is following an existing pattern. Traditional financial institutions are moving directly into tokenization trading infrastructure. The investment case for stablecoins is shifting from issuance toward cross-border payments and local rails. Capital in AI-plus-crypto is also leaning toward lower-layer tools that can generate real transaction and settlement demand. By contrast, financing conditions remain cautious for generic protocols that lack users, revenue or distribution channels.
About KuCoin Ventures and disclaimer
The report said KuCoin Ventures is the main investment arm of the KuCoin exchange. KuCoin described itself as a global cryptocurrency exchange trusted by more than 40 million users across over 200 countries and regions. KuCoin Ventures said it invests in disruptive crypto and blockchain projects for the Web3 era and supports builders in crypto and Web3.0 both financially and strategically, with a focus on Web3.0 infrastructure, artificial intelligence, consumer applications, decentralized finance and payment finance.
The report also included a disclaimer saying the material is for general market information only and may include information from third-party, commercial or sponsored sources. It said the content does not constitute legal opinions, compliance advice, financial or investment advice, an offer or solicitation, or any guarantee. It added that no express or implied representation or warranty is made as to accuracy, completeness or reliability, and that no liability is accepted for losses arising from use of the content. The report also said investing and trading involve risk, past performance does not guarantee future results, and users should conduct their own research and make careful judgments, seeking professional legal, tax or financial advice when needed.
A further disclaimer at the end said: "Markets carry risk. Invest cautiously. This article does not constitute investment advice, and users should consider whether any opinion, view or conclusion in it fits their own circumstances. Any investment decision made on that basis is taken at their own responsibility."
