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2026 is crypto’s integration year, Silicon Valley Bank says

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2026 is crypto’s integration year, Silicon Valley Bank says

Last year restored crypto’s institutional footing. This year, according to Silicon Valley Bank (SVB), is when it becomes more integrated into the financial system.

Regulatory clarity improved in 2025, institutional engagement accelerated and capital markets reopened. Now the focus is shifting from price cycles to infrastructure as digital assets become more deeply embedded into payments, custody, treasury management and capital markets.

“Regardless of how tangible or visible, all the forces shaping crypto today share a common thread: Crypto is moving from expectations to production. Pilot programs are scaling and capital is consolidating,” Anthony Vassallo, senior vice president of crypto at SVB, told CoinDesk in an interview.

The bank, which maintains more than 500 relationships with crypto companies and venture firms investing in the sector, says institutional capital, consolidation, stablecoins, tokenization and AI are converging to reshape how money moves.

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After its 2023 collapse, SVB was bought by North Carolina–based First Citizens Bank and now operates within a top-20 U.S. bank with $230 billion in assets. In 2025, it added 2,100 clients and ended the year with $108 billion in total client funds and $44 billion in loans.

Fewer experiments, more conviction

“The suits and ties have arrived,” according to the bank’s 2026 outlook report.

Venture funding in U.S. crypto companies rose 44% last year to $7.9 billion, according to PitchBook data cited by SVB. While the deal count fell, median check sizes climbed to $5 million as investors concentrated capital into stronger teams. Seed valuations jumped 70% from 2023 levels.

The bank warns that demand for institutional-grade crypto companies could outstrip the number of investable firms.

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“In 2026, conditions are ripe for continued growth in VC investment in crypto. As institutional adoption accelerates, driving larger venture capital checks, we expect continued capital concentration in fewer companies with investors prioritizing higher-quality projects and follow-ons into proven teams,” Vassallo said.

“For end users, the result will be a more seamless experience across everyday financial interactions, from sending cross-border payments to managing an investment portfolio.”

Corporate balance sheets are reinforcing the shift. At least 172 public companies held bitcoin in the third quarter of 2025, up 40% from the second, collectively controlling roughly 5% of circulating supply, according to data referenced by SVB.

A new class of digital asset treasury companies, firms that treat crypto accumulation as a core strategy, has emerged. The bank expects consolidation as standards tighten and volatility tests business models.

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Meanwhile, traditional banks are moving deeper into the sector. JPMorgan, the largest U.S. bank by assets, plans to accept bitcoin and ether as collateral, Bloomberg reported last year. SoFi Technologies offers direct digital asset trading. U.S. Bank provides custody through NYDIG. SVB expects more institutions to roll out lending, custody and settlement products as compliance guardrails solidify.

M&A and the race to full-stack crypto

Why build when you can buy?

More than 140 venture capital-backed crypto companies were acquired in the four quarters ending in September, a 59% year-over-year jump, according to the bank’s analysis of PitchBook data. Coinbase’s $2.9 billion acquisition of Deribit and Kraken’s $1.5 billion purchase of NinjaTrader underscored the scale.

The trend extends to banking charters. In 2025, 18 companies applied for charters from the Office of the Comptroller of the Currency (OCC), most of them blockchain-enabled firms. The OCC granted conditional approval to digital-asset-focused trust banks including custody provider BitGo (BTGO), Circle Internet (CRCL), the company behind the second-largest stablecoin, trading platform Fidelity Digital Assets, stablecoin issuer Paxos and payments network Ripple.

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For SVB, that marks a turning point: stablecoin and custody infrastructure moving inside the federal banking perimeter. The bank expects traditional financial institutions to accelerate dealmaking rather than risk being disrupted by vertically integrated crypto-native rivals.

“We expect M&A to set a record again in 2026. As digital asset capabilities
become table stakes for financial services, companies will focus on acquisition strategies instead of building products from scratch,” Vassallo says.

“To meet market demands ranging from stablecoin capabilities to full-stack crypto banks, exchanges, custodians, infrastructure providers and brokerages will consolidate into multiproduct companies,” he said.

Stablecoins become the ‘internet’s dollar’

Stablecoins, SVB said, are evolving from trading tools into digital cash.

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With near-instant settlement and lower transaction costs than interbank transfer system ACH or card networks, dollar-backed tokens are attractive for treasury operations, cross-border payments and business-to-business settlement.

Regulatory clarity is accelerating adoption. The U.S. GENIUS Act, passed in July, established federal standards for stablecoin issuance, including 1:1 reserve backing and monthly disclosures. Similar frameworks are in place in the EU, U.K., Singapore and the UAE.

Beginning in 2027, only permitted entities such as banks or approved nonbanks will be allowed to issue compliant stablecoins in the U.S. SVB expects issuers to spend 2026 aligning products with federal oversight.

Banks are already experimenting. Société Générale introduced a euro stablecoin. JPMorgan expanded JPM Coin to public blockchains. A group including PNC, Citi and Wells Fargo is exploring a joint token initiative.

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Venture dollars are following. Investment in stablecoin-focused companies surged to more than $1.5 billion in 2025, up from less than $50 million in 2019, according to SVB.

In 2026, the bank expects tokenized dollars to move into core enterprise systems, embedded in treasury workflows, collateral management and programmable payments.

Tokenization and AI

Real-world asset tokenization is scaling. Onchain representations of cash, Treasuries and money-market instruments exceeded $36 billion in 2025, according to data cited by the bank.

Funds from BlackRock (BLK) and Franklin Templeton have amassed hundreds of millions in assets, settling flows directly onchain. ETF issuers and asset managers are testing blockchain-based wrappers to reduce transfer costs and enable intraday settlement. Robinhood (HOOD) now has tokenized stock exposure for European users and plans U.S. expansion.

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SVB sees private and public markets converging on shared settlement rails, with tokenization expanding beyond Treasuries into private markets and consumer-facing applications.

Then there’s the convergence with AI. In 2025, 40 cents of every venture dollar invested in crypto went to companies also building AI products, up from 18 cents the year prior, according to SVB’s analysis. Startups are building agent-to-agent commerce protocols, and major blockchains are integrating AI into wallets.

Autonomous agents capable of transacting in stablecoins could enable machines to negotiate and settle payments without human intervention. Blockchain-based provenance and verification tools are being developed to address AI’s trust deficit.

The consumer impact may be subtle. SVB predicts that next year’s breakout apps won’t brand themselves as crypto. They will look like fintech products, with stablecoin settlement, tokenized assets and AI agents operating quietly in the background.

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From expectation to infrastructure

Silicon Valley Bank’s overarching message is to treat crypto as infrastructure.

Pilot programs are scaling. Capital is concentrating. Banks are entering. Regulators are defining the perimeter. Blockchain technology is poised to underpin treasury operations, collateral flows, cross-border payments and parts of capital markets.

Volatility will remain, and headlines will continue to move prices. But the deeper narrative, the bank argues, is about the plumbing.

“In 2025, momentum in onchain representations of cash, treasuries and money market instruments carried real-world assets into the financial mainstream,” Vassallo said. “This year, cryptocurrency will be treated as infrastructure.”

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Read more: R3 bets on Solana to bring institutional yield onchain

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Crypto World

Binance Founder CZ Urges Faster Evolution of Privacy Features in Crypto

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Nexo Partners with Bakkt for US Crypto Exchange and Yield Programs

TLDR

  • Changpeng Zhao, founder of Binance, emphasizes that privacy is the most significant unresolved issue in the cryptocurrency industry.
  • Zhao argues that Bitcoin and most cryptocurrencies lack adequate privacy features, leaving users vulnerable to tracking.
  • CZ highlights that blockchain transactions are traceable, especially with KYC practices on centralized exchanges.
  • The Binance founder calls for the development of better privacy infrastructure to enable secure crypto payments while complying with regulations.
  • Binance’s history with privacy coins, such as the delisting of Monero, raises concerns about the exchange’s stance on privacy.

Changpeng Zhao, the founder of Binance, has stressed the importance of privacy in the cryptocurrency sector. He pointed out that most digital assets lack sufficient privacy protections, making users vulnerable in ways traditional currency does not. Speaking on the All-In Podcast, CZ emphasized the need for faster advancements in crypto privacy.

Privacy Concerns for Cryptocurrency Payments

CZ argued that privacy plays a fundamental role in society but is currently inadequate in most cryptocurrencies, including Bitcoin. “Bitcoin was designed to be pseudo-anonymous,” he explained. “But in reality, every transaction on the blockchain can be traced, especially with KYC on centralized exchanges.” This, he noted, exposes users to risks like unwanted tracking, especially in scenarios such as hotel bookings where third parties might gain access to personal information.

He further elaborated on how payment privacy is a significant hurdle as the cryptocurrency industry moves toward mainstream adoption. With major players like AI agents and institutional investors getting involved, the open ledger design of blockchains like Bitcoin remains a challenge. CZ believes that to achieve widespread use, privacy features must evolve to meet the needs of both businesses and consumers.

Binance and Privacy Coins

Despite CZ’s calls for better privacy features, Binance’s own history with privacy coins has been controversial. In February 2024, Binance delisted Monero (XMR), which at the time was the largest privacy coin. This decision came shortly after CZ stepped down as CEO of Binance, and it led to a 17% drop in Monero’s price. Binance has often cited factors such as trading volume and liquidity in delisting assets, claiming it takes action when a coin no longer meets its standards.

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CZ’s comments also raised questions about Binance’s stance on privacy coins like Zcash (ZEC). Last year, Binance included Zcash in a community vote on potential delistings. Zcash’s founder, Zooko Wilcox, raised concerns directly with Binance, highlighting the importance of privacy features in cryptocurrency transactions.

The Need for Widespread Privacy Infrastructure

While privacy coins like Monero and Zcash exist, CZ and industry experts suggest that they are not a complete solution. Nic Puckrin, a digital asset analyst, believes the focus should be on developing broader privacy-preserving infrastructure. Puckrin stressed that the issue isn’t to make payments untraceable but to ensure privacy while staying compliant with regulations. He argued that businesses must adopt these privacy features to enable secure crypto payments.

In the face of these challenges, CZ acknowledged that privacy features are a crucial aspect for crypto’s future. Although law enforcement may seek transparency for security reasons, CZ is confident that privacy can be enhanced without undermining efforts to track bad actors.

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Paradigm Challenges Bitcoin Mining Narrative Amid AI Data Center Boom

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Paradigm Challenges Bitcoin Mining Narrative Amid AI Data Center Boom

The rapid buildout of AI data centers has revived a long-running debate over energy consumption, with critics arguing that large computing operations, including Bitcoin mining, strain power grids and drive up electricity prices.

As Cointelegraph previously reported, the surge in AI data center construction has fueled local resistance in several US regions, with residents and lawmakers raising concerns about power demand and rising electricity costs. Bitcoin (BTC) mining has increasingly been linked to the broader debate over high-density computing infrastructure.

In a recent research note, crypto investment firm Paradigm pushed back on that narrative, arguing that Bitcoin mining is frequently misunderstood and often mischaracterized in public energy debates. Rather than treating mining as a static energy drain, Paradigm frames it as a participant in electricity markets, one that responds to price signals and grid conditions.

Paradigm’s Justin Slaughter and co-author Veronica Irwin also challenge several common assumptions used in energy modeling. For example, they note that some analyses measure Bitcoin’s energy use on a per-transaction basis, even though mining energy consumption is tied to network security and competition among miners, not transaction volume. 

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Other models assume energy production is effectively limitless or that miners will continue operating regardless of profitability, assumptions Paradigm argues are unrealistic in competitive power markets.

According to Paradigm, Bitcoin mining currently accounts for about 0.23% of global energy consumption and about 0.08% of global carbon emissions. Because the network’s issuance schedule is fixed and mining rewards decline about every four years, Paradigm argues that long-term energy growth is constrained by economic incentives.

Source: Daniel Batten

Related: Bitcoin miner production data reveals scale of US winter storm disruption

Bitcoin mining as flexible grid demand

A central pillar of Paradigm’s argument is demand flexibility.

Bitcoin miners typically seek out the lowest-cost electricity, often sourced from surplus or off-peak generation.

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Mining operations can scale consumption based on grid conditions, reducing usage during periods of stress and increasing it when supply exceeds demand. In that sense, Paradigm describes mining as a flexible load, similar to energy-intensive industries that respond to real-time pricing signals.

The debate has taken on new urgency as AI data center expansion accelerates. As Cointelegraph recently reported, some crypto-era infrastructure is now being repurposed to support artificial intelligence workloads, with companies shifting from Bitcoin mining to AI data processing to pursue higher margins. Several traditional Bitcoin miners, including Hut 8, HIVE Digital, MARA Holdings, TeraWulf and IREN, have begun making partial transitions.

By framing mining as responsive demand rather than constant consumption, Paradigm’s report shifts the debate from environmental alarmism to grid economics. The implication for policymakers is that Bitcoin mining should be evaluated within the broader electricity market rather than through simplified energy comparisons.

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Related: The real ‘supercycle’ isn’t crypto, it’s AI infrastructure: Analyst