Blockchain & Digital Assets Weekly Briefing - Week 18
- danae317
- May 2
- 7 min read
Week ending 2nd May 2025
From cleaner Bitcoin mining to sovereign-backed stablecoins and Wall Street’s deepening embrace of digital assets, 2025 is shaping up to be a transformative year for the crypto industry. A new report from Cambridge University reveals major environmental progress in Bitcoin mining, while institutions in the UAE move to launch a stablecoin tied to the dirham. Meanwhile, Morgan Stanley prepares to offer spot crypto trading through E*Trade, Coinbase debuts a Bitcoin yield fund for institutional investors, and Citi projects that stablecoins could power a trillion-dollar shift in global Treasury demand by 2030. Together, these developments point to a maturing digital asset ecosystem that’s becoming smarter, greener, and increasingly integrated into traditional finance.
Bitcoin mining in 2025: cleaner, smarter, and more sustainable, finds Cambridge University report.
Three major UAE institutions to launch UAE Dirham-backed stablecoin.
Morgan Stanley embraces crypto, plans spot trading for E*Trade clients.
Coinbase launches Bitcoin yield fund targeting 4–8% annual returns for institutional investors.
Citi GPS: stablecoins projected to reach $1.6 trillion by 2030, driving $1 trillion in U.S. Treasury demand.
Bitcoin mining in 2025: cleaner, smarter, and more sustainable, finds Cambridge University report
Bitcoin mining has rapidly transformed from a niche pursuit into a global-scale industrial sector, now situated at the critical intersection of energy systems and digital infrastructure. The 2025 Cambridge Digital Mining Industry Report presents a comprehensive and data-rich analysis of the global Bitcoin mining industry, drawing on direct survey responses from 49 mining companies that collectively account for nearly half of Bitcoin’s global computational capacity. This year’s report marks a significant improvement over previous editions by offering deeper insight into energy sources, environmental impacts, and technological trends in the sector.
According to the report, Bitcoin mining currently consumes an estimated 138 terawatt-hours (TWh) of electricity annually, producing approximately 39.8 million tonnes of CO₂-equivalent emissions (MtCO₂e). Despite the high energy use, the sector is showing clear signs of progress toward sustainability. The United States has emerged as the dominant mining hub, representing 75.4% of reported mining activity, while the electricity mix remains varied: sustainable energy sources account for 52.4%, yet natural gas stands as the single most common source at 38.2%.
Industry participants flagged regulatory unpredictability and energy costs as their main challenges, with firms increasingly adopting geographical and business diversification to mitigate risk. Meanwhile, growth is being constrained by infrastructure limitations and a lack of viable deployment opportunities.
Key Findings:
Improved Carbon Efficiency: The environmental impact of Bitcoin mining has decreased significantly. The report estimates current emissions intensity at 288.2 grams of CO₂e per kilowatt-hour (gCO₂e/kWh), positioning it as less carbon-intensive than many traditional industrial activities.
Lower Net Emissions through Innovation: When accounting for mitigation strategies such as flare gas utilization and waste methane capture, net emissions fall to 37.6 MtCO₂e. Notably, methane mitigation technologies are offsetting 5.5% of total network emissions.
Shift Toward Clean Energy: The industry continues to move toward greener operations, with 55.7% of mining now powered by renewable or low-carbon energy sources, signaling meaningful progress in energy transition efforts.
Strong Performance in eWaste Management: The report reveals that 86.9% of mining hardware is either recycled, resold, or repurposed, making Bitcoin mining one of the more responsible technology sectors in terms of electronic waste (eWaste) handling.
Increased Hardware Efficiency: A clear trend is emerging toward the use of more energy-efficient mining machines, which reduce operational costs and lower environmental impact.
Declining Illicit Use of Bitcoin: The use of Bitcoin for illicit activity has steadily declined, having peaked in proportional terms in 2019 and absolute terms in 2022. Both metrics show a downward trajectory, reinforcing the argument that Bitcoin’s use cases are becoming increasingly legitimate.
Overall, the report suggests that Bitcoin mining is progressing toward greater sustainability and responsibility, both environmentally and economically.
Three major UAE institutions to launch UAE Dirham-backed stablecoin
International Holding Company (IHC), Abu Dhabi Developmental Holding Company (ADQ), and First Abu Dhabi Bank (FAB) have announced on Monday the development of AE Coin, a stablecoin pegged to the UAE dirham. The project is part of a broader push to modernize payment infrastructure and expand access to blockchain-based financial services.
AE Coin has received preliminary approval from the Central Bank of the UAE, with plans for FAB to issue the token, pending full regulatory clearance. Designed to maintain a 1:1 peg with the dirham, the stablecoin will be backed by reserves held within the country and subject to regular audits and oversight.
The coin will be built on the ADI blockchain, a network developed by the ADI Foundation, which is based in the UAE. The foundation focuses on linking traditional financial systems with blockchain infrastructure, and currently holds partnerships with governments in more than 20 countries. According to the project’s backers, this framework is intended to support compliant and scalable digital payments across borders, particularly in emerging markets.
Beyond domestic use, AE Coin is expected to integrate with decentralized finance (DeFi) platforms, potentially enabling users to access services like peer-to-peer lending or digital asset trading.
This initiative aligns with a broader international trend, as countries explore central bank digital currencies (CBDCs) or regulated stablecoins. Recent efforts include China’s digital yuan, Nigeria’s eNaira, and pilot projects in Japan and Singapore—reflecting a growing interest in sovereign-backed digital money as a means to enhance financial infrastructure and policy control.
Morgan Stanley embraces crypto, plans spot trading for E*Trade clients
According to Bloomberg, Morgan Stanley is taking a bold step into the cryptocurrency space by preparing to launch spot crypto trading for its E*Trade clients. This initiative marks a new chapter for the Wall Street giant, which has already offered its wealthy clientele access to crypto-related products such as ETFs, ETF options, and futures. Executives at the firm now view direct trading of digital assets—beginning with Bitcoin and Ethereum—as the natural progression of their digital asset strategy.
The move highlights Morgan Stanley’s growing commitment to crypto amid shifting market sentiment and evolving regulatory dynamics in the U.S. Unlike previous indirect offerings, this effort brings cryptocurrency trading to a broader retail audience through E*Trade’s established brokerage platform. Sources familiar with the plans indicate that final internal and regulatory approvals are pending.
By bridging traditional finance with emerging digital markets, Morgan Stanley is not only responding to client demand but also positioning itself in direct competition with established crypto-native platforms like Coinbase. The decision reinforces a larger trend: major financial institutions are no longer cautiously observing crypto from the sidelines—they’re stepping in.
Coinbase launches Bitcoin yield fund targeting 4–8% annual returns for institutional investors
Coinbase Asset Management has introduced the Coinbase Bitcoin Yield Fund (CBYF), a new investment product designed for institutional investors outside the United States. Launched on May 1, 2025, the fund aims to provide annual net returns of 4% to 8%, paid directly in Bitcoin.
Unlike cryptocurrencies such as Ethereum and Solana, which offer native staking yields, Bitcoin lacks built-in mechanisms for generating passive income. To address this, CBYF employs a conservative investment strategy known as basis trading, which exploits the price differences between spot and futures markets. This approach is intended to offer a lower-risk alternative to more aggressive yield-seeking strategies.
Investors can subscribe to and redeem from the fund using Bitcoin, with assets held in cold storage through third-party custody integrations to minimize counterparty risk . The fund has garnered support from institutions like Abu Dhabi-based Aspen Digital, reflecting a growing institutional interest in Bitcoin-based financial products .
It marks one of the most structured and regulated attempts to deliver sustainable yield on Bitcoin holdings—something that has traditionally been associated with high risk and limited transparency. By introducing a familiar, hedge fund-style product tailored for large investors, Coinbase is helping to legitimize Bitcoin as a productive asset class and encouraging further integration of digital assets into the traditional financial system.
This could pave the way for broader institutional adoption and more sophisticated Bitcoin-based investment tools in the future.
Citi GPS: stablecoins projected to reach $1.6 trillion by 2030, driving $1 trillion in U.S. Treasury demand
Citigroup’s April 2025 Global Perspectives & Solutions (GPS) report, “Digital Dollars: Banks and Public Sector Drive Blockchain Adoption,” positions 2025 as a potential turning point — a ‘ChatGPT moment’ for blockchain adoption, especially in the financial and public sectors. This anticipated inflection point is expected to be driven by maturing technologies and regulatory changes, particularly surrounding stablecoins.
In its base case, Citi forecasts the total supply of stablecoins to reach $1.6 trillion by 2030, with a bullish case reaching up to $3.7 trillion. Roughly 90% of this supply is expected to remain US dollar-denominated, even as other nations advance their own CBDC (central bank digital currency) strategies in local currencies. Citi emphasizes that stablecoins are no longer a fringe innovation — they are becoming an embedded part of the financial system.
One of the report’s most impactful insights is the potential macroeconomic effect on U.S. Treasury markets. If a U.S. regulatory framework is enacted — such as through versions of the STABLE Act or GENIUS Act (both currently unpassed) — stablecoin issuers could emerge as major holders of short-term U.S. government debt. Citi estimates this could translate into $1 trillion in net new demand for Treasuries by 2030, rivaling traditional institutional buyers.
Citi also discusses the competitive tension stablecoins introduce to traditional banks, particularly in the form of deposit substitution. However, rather than viewing this as a threat alone, the report suggests banks have an opportunity to integrate stablecoins into their service offerings — including real-time settlement, programmable money features, and global payments infrastructure. Banks could also benefit from participating in tokenized asset markets, cross-border payment solutions, and stablecoin custody services — transforming the landscape of commercial banking and payment rails.
Blockchain is steadily making inroads into the public sector, as governments seek more transparent, efficient, and accountable systems for managing public funds and services. In the U.S., initiatives like the Department of Government Efficiency (DOGE), alongside pilot programs from central banks and Multilateral Development Banks, are testing blockchain’s potential beyond finance.
Key public sector use cases identified include:
Tracking public spending and budgeting flows
Subsidy and aid disbursement (e.g., humanitarian aid campaigns)
Public records and registries (e.g., land, corporate, health)
Digital identity verification and access control
Tokenization of government-owned assets and infrastructure
While on-chain activity in the public sector remains in its early stages, Citi views this growing momentum as a strong signal of institutional interest—one that could accelerate broader adoption across both public and private domains, despite the persistent challenges of scale, security, and regulatory alignment.
Still, risks remain. These include potential fraud, privacy concerns, and governance challenges. Implementation across both finance and public services will require careful policy coordination, technological standards, and cross-sector collaboration.
WHAT WE ARE READING
UK sets out new rules for crypto as it aligns with US on approach
North Carolina Digital Assets Bill Passes House, Moves to Senate for Debate
Pantera Names Former Kraken Chief Legal Officer Marco Santori a General Partner
Crypto Influencer Anthony ‘Pomp’ Pompliano-Led SPAC Files for IPO
Trump-Tied Stablecoin Used for MGX’s $2 Billion Binance Deal
Eric Trump: ‘If banks don’t watch what’s coming, they’ll be extinct in 10 years’
SoFi CEO says fintech bank is bringing back crypto investing
South Korea Signals Crypto U-Turn With Pledge To Unban Spot ETFs by 2025
BlackRock Brings Blockchain Push to a $150 Billion Treasury Fund
Anonymous Labs Partners with Banijay Rights to Launch Peaky Blinders Web3 Game
