In partnership with

Happy Wednesday, Fintech Takers!

My question in Monday’s newsletter about the proper time to start decorating for and celebrating the Christmas season got quite a response!

The majority of respondents have said that post-Halloween is perfectly acceptable, and as one person told me, “we deserve all the joy we can get.”

Fair enough! I accept this answer and will no longer be a scrooge about it!

— Alex 

P.S. — If you’ve been nodding along in stablecoin conversations without totally following them, you’re in good company.

This year’s biggest developments were mostly explained by people who assume you already know what “mint and burn” means. Let’s fix that.

Simon Taylor (Brainfood), Rob Hadick (Dragonfly), John Timoney-Gomez (Rain) and I are hosting a live year in review on Dec. 15 to unpack what happened and what it means for your bank in 2027. No crypto background required.

Sign up to join us here!

In partnership with BVNK

A stablecoin can move around the world in seconds.

Turns out, the last mile can be the longest. Especially when the plumber still needs cash, and payroll's due tomorrow.

That's the problem Mastercard and BVNK have joined forces to tackle.

Their new Global Money Platform combines BVNK’s stablecoin infrastructure with Mastercard’s global payments network, which banks and fintech companies can embed into their own platforms.

Through one integration, customers get accounts that hold fiat and stablecoins, and convert between them in real time.

Payouts can go out in stablecoins or local currency and reach a local bank account or card, where the last mile ends.

Banks and fintech companies shouldn’t have to stitch together multiple providers or master stablecoin infrastructure just to make that money useful to their customers.

And now, they won't have to.

Check it out

3 BIG IDEAS FROM THE PODCAST

This week’s episode of the Fintech Takes podcast was an emergency one.

A few days after the midterms, I flashed the regulatory bat signal to bring Rob Blackwell (Chief Content Officer & Head of External Affairs at IntraFi and host of the Banking With Interest podcast) back on. Rob has covered banking and politics for 25 years and knows every corner of D.C.

Thanks to last week, Democrats have secured at least 54 Senate seats, are on track for their largest House majority since 2008, and have flipped six governorships.

Rob’s verdict: “Stunning, generational.”

We explored who’s likely to lead the committees overseeing banking and crypto, and what they might investigate (and which regulators could find themselves in the hot seat).

Plus, we end with a tribute to Sir Patrick Stewart and some Star Trek talk, as one does.

Tune in for the full conversation here

And read below for my three big ideas...

#1: Don’t Forget About the States!Copy anchor linkCopied

For all the attention we're paying to Democrats retaking Congress, some of the most important financial services policy changes could happen a lot closer to home.

Democrats also flipped governorships and state legislatures, including in Texas, where they won the governorship and control of the state House. And Rob thinks those results could open the door to a wave of state level financial regulation.

Here's Rob’s hot take. Moderate Democrats performed especially well in this election, but that doesn't mean economic populism is going away. Quite the opposite. Voters were furious about the cost of living, and newly elected Democrats are going to want to show they're doing something about it.

Bank fees make an appealing target.

We’ve already seen what this can look like in Illinois, which passed a law prohibiting interchange fees on the sales tax and gratuity portions of card transactions. That set off a legal fight over federal preemption. A June ruling blocked enforcement against several categories of banks and the card networks, and a September ruling extended that protection to federal credit unions.

Rob expects similar fights to emerge elsewhere. And states have increasingly gone beyond enforcement, passing legislation that creates entirely new obligations for financial institutions.

Of course, the outcome won't be uniform. Rob spoke with independent bankers in Texas who have strong relationships with Democratic lawmakers. Those relationships could create opportunities for legislation that helps banks. Elsewhere, the industry's political position may be much less, well, comfortable.

Which leaves banks and fintech companies with an interesting problem. The new Democratic majorities have a mandate to address affordability, and financial services fees are an obvious place to look for relief.

#2: Warren’s BrainchildCopy anchor linkCopied

The Trump administration spent much of the past two years trying to gut the Consumer Financial Protection Bureau. Acting Director Russell Vought reduced its staff and operations dramatically, and the agency largely retreated from its enforcement and rulemaking responsibilities.

Rob pointed out that bankers weren't exactly thrilled.

Many would have preferred the CFPB they got under Kathy Kraninger during President Trump's first term. That bureau went after perceived bad actors and still functioned, while taking a less antagonistic approach towards the industry overall.

Instead, it was gutted and now the stage is set for the pendulum to swing back … hard. 

As Rob explained, a future Democratic administration could examine consumer financial practices from the years when the CFPB was largely inactive, subject to applicable legal deadlines. The absence of an active regulator doesn't necessarily eliminate liability for conduct that occurred during that period.

Then there’s Elizabeth Warren, the favorite to chair Senate Banking. Rob correctly noted that the CFPB is “Elizabeth Warren’s brainchild.” For the last two years, she could mostly write sternly worded letters and grab limited time in hearings. With the Senate Banking Committee gavel, she will be able to set the agenda.

Rob expects hearings on what the CFPB stopped watching, including fintech companies perceived as “ripping people off.” He floated Synapse as one example.

President Trump has nominated Brian Johnson to lead the CFPB, and Rob expects him to turn some of the lights back on … if he’s confirmed.¹ But Warren will have her say at every step along the way.

#3: Bipartisanship Gets a 3/10Copy anchor linkCopied

I asked Rob to rate the likelihood of President Trump and a Democratic Congress passing financial services legislation together on a scale of one to ten.

His answer?

Three.

There’s real common ground. Trump has called for capping credit card interest rates at 10%, an idea that overlaps with some Democrats’ populist instincts. And right now, Rob says, we’re in a honeymoon period full of happy talk.

But Rob offered a wonderfully specific example of just how fragile that common ground can be.

In his State of the Union, President Trump asked Congress to add a ban on institutional investors buying single family homes to a bipartisan housing bill both chambers were already working on. Traditional conservatives dislike the idea. Elizabeth Warren loved it, and she and the President worked it out. The White House said it would take either chamber’s version, as long as the provision was in.

A few months later, Trump said he didn’t like the bill, including the provision he’d asked for, and FHFA Director Bill Pulte urged a veto. Rob’s explanation is that the President had been told the provision was something Senator Warren specifically wanted, and he started to view it as “her bill and her product.” Trump’s own name for it on social media was “The Elizabeth ‘Pocahontas’ Warren centric housing bill.” By Rob’s account, he came very close to a veto.

Ultimately, Trump let the housing bill become law without his signature, publicly citing a separate dispute over voting legislation.

That was before Democrats won back Congress.

The happy talk will face harder tests soon. Rob expects investigations and subpoenas, and he doubts Trump’s openness to cooperation will survive them. Rob also points to the new White House chief of staff, Stephen Miller, architect of the ICE deportations that helped push Hispanic voters toward Democrats. Miller’s appointment hardly suggests a new era of bipartisan goodwill.

Democrats, meanwhile, have their own incentives. They can pass ambitious bills and make Republicans own their opposition. When those bills reach the President’s desk, he has three options: sign them, veto them and own the veto, or do what he did with housing and let them become law with his name kept off.

Which means we could see plenty of legislative action without much bipartisan legislation to show for it.

Three out of ten sounds about right.

WHAT I'M LISTENING TO

#1: Know the Score (99% Invisible) 🎧Copy anchor linkCopied

Oooh! One of my favorite podcasts tackling a topic I actually know a little about. Fun!

#2: What Robert Caro learned about power after studying it for 50 years (Dwarkesh Podcast) 🎧Copy anchor linkCopied

Conan O’Brien once said of Robert Caro, “He has this dedication to what he's doing that almost feels like it's akin to Egyptians building a pyramid.”

I completely agree. If you haven’t read Caro’s books on Robert Moses and LBJ, you should add them to the top of your pile. And add this podcast on top of that.

Thanks for the read! Let me know what you thought by replying back to this email. 

— Alex