Stablecoin funds offer another way to invest in cryptocurrencies, especially for those wary of buying individual cryptocurrencies and losing them or having them stolen by cyber thieves.
The stablecoin funds provide a variety of opportunities to invest in the growing interest in cryptocurrencies. One reason for the rising interest in cryptocurrency is the shrinking value of the U.S. dollar, which has lost more than 10% in the first half of 2025.
Gold and cryptocurrency, including Bitcoin and stablecoins, provide a means of protecting the purchasing power, said Michelle Connell, who heads Dallas-based Portia Capital Management. She informed me on Tuesday, Sept. 9, that an allocation of up to 5% of some of her clients’ assets now makes sense.
But risk management of these new assets still is needed, Connell counseled. As part of her cautious approach to investing in cryptocurrencies, Connell said she is looking at weighing in with cryptocurrency ETFs that have cover calls and other forms of downside protection, while still providing upside participation.
Stablecoin Funds Offer Another Way to Invest in Cryptocurrencies: TNT Trader
A new proponent of stable coin funds is Mark Skousen, PhD, who heads the TNT Trader advisory service with his son Tim Skousen. The advisory service recommended its first stablecoin investment company on Tuesday, Sept. 9.
TNT Trader recommends both equities and options. It gives investors a chance to limit their risk of indulge an urge to seek fast profits while accepting increased risk.
Mark Skousen, head of TNT Trader and Forecasts & Strategies, meets with Paul Dykewicz.
Another reason why cryptocurrency investing is gaining appeal is the Genius Act, supported by President Trump, according to the TNT Trader advisory service. TNT Trader currently also recommends Solana and Bitcoin.
The market has seen signs that Solana will quickly follow with big moves, Skousen advised his subscribers. But Solana has been volatile, too. Near the market’s close on Aug. 16, Solana had jumped 5.31% to $197.25 in the prior eight hours. Early in the morning of Friday, Aug. 29, Solana fell 5.09% to $206.06, but jumped to $209.20 on Sept. 2 when it soared 6.74% that day. It traded at $215.30 as I wrote my column Tuesday evening, Sept. 9.
Stablecoin funds have the potential to become an income-generating investment strategy. Those stablecoins are tied to cryptocurrency that is pegged to another asset like a fiat currency, such as the U.S. dollar or the euro. Gold also can be aligned with stablecoins.
One difference is that fiat currency is backed by a government rather than a physical commodity such as gold or silver, allowing central banks around the world to exert control over economic conditions by using liquidity and interest rates. Stablecoins provide an alternative to volatility shown by cryptocurrencies. In addition, stablecoins serve as bridge currency to help crypto traders switch between volatile assets.
Stablecoins also can be used in various blockchain-based financial services. The term “stablecoin” is a bit of a misnomer, since there is no guarantee that it holds a steady value in relation to a fiat currency or gold when traded on secondary markets. Nor is there assurance any reserve of assets, if used, will be adequate to satisfy all redemptions, according to Coinbase Global, Inc. (NASDAQ: COIN).
Fully backed by U.S. dollars and U.S. dollar equivalents, USDC was developed to represent a U.S. dollar equivalent on chain. USDC can be used to send, store and receive money between people and businesses without the need for third-party financial institutions.
Chart courtesy of www.stockcharts.com.
StableCoin Funds Offer Another Way to Invest in Cryptocurrencies: New Stablecoin Ventures
Stablecoins are attracting interest. Reflect Money announced on Tuesday, Sept. 2, that it had a $3.75 million seed round led by a16z crypto’s CSX accelerator, with participation from Solana Ventures, Equilibrium, BigBrain Holdings and Colosseum.
Also on Sept. 2, Asia gained attention in global crypto-finance landscape with Hong Kong reclaiming its historical niche as a regulated gateway linking traditional finance with digital assets. Institutional interest is rising for compliant, algorithmically driven Bitcoin exposure, shown by sovereign wealth funds boosting Bitcoin allocations and Hong Kong-based fintech firms raising more than $1.5 billion to support crypto infrastructure and stablecoin frameworks.
Next-generation platforms such Solowin Holdings (NASDAQ: SWIN), which melds licensed crypto infrastructure, quantitative strategies and access to Asia’s high-net-worth investors, are poised to capitalize on the structural shift. Solowin Holdings joins other tech-savvy companies — including Coinbase Global, Bit Mining Ltd. (NYSE: BTCM), Bakkt Holdings Inc. (NYSE: BKKT) and Marathon Holdings Inc. (NASDAQ: MARA) — in focusing on strengthening their positions in a rising sector.
Stablecoin Funds Offer Another Way to Invest in Cryptocurrencies: Retired Pension Fund Chairman
The recently passed U.S. GENIUS Act, signed into law by President Trump on July 15, sets rules for stablecoin, wrote Retirement Watch investment newsletter leader Bob Carlson, a retired pension fund chairman. A stablecoin is a digital token that is backed by assets.
The GENIUS Act is supposed to reduce the ability of stablecoin issuers to commit fraud or issue tokens that lack sufficient asset backing, Retirement Watch reported. The law also prohibits stablecoin issuers from offering interest or other payments to users. The coins are supposed to be used for payments, not as investments.
Bob Carlson heads Retirement Watch.
“The Genius Act requires 100% reserve backing with liquid assets like U.S. dollars or short-term Treasuries and compels issuers to make monthly, public disclosures of the composition of reserves,” according to the White House. “Stablecoin issuers must comply with strict marketing rules to protect consumers from deceptive practices. Crucially, they are forbidden from making misleading claims that their stablecoins are backed by the U.S. government, federally insured or legal tender.”
In the stereotypical stablecoin, an issuer takes money from users and buys U.S. Treasury bills with that money, Carlson commented.
“The issuer receives and keeps any interest earned on the treasury bills,” Carlson counseled. “The bills are sold when users redeem the stablecoins or transfer them to someone else, such as to pay for goods or services. Banks already are objecting that there are loopholes in the law.”
Stablecoin Funds Offer Another Way to Invest in Cryptocurrencies: Connell’s Circle
“The usual outcome for tariffs is inflation, and inflation brings depreciation of the U.S. dollar,” said Connell, who leads Portia Capital Management. “There are a plethora of stablecoin investments, but I would stick with those that have the largest user base and a good track record.”
Connell told me that her top stablecoin choice is Circle’s USDC, or USD Coin. As the ticker notes, this stablecoin is pegged to the U.S. dollar, she added.
“USD Coin has a solid reputation for transparency and compliance,” Connell said. “Its liquidity is provided by U.S. dollars and dollar equivalent investments.”
Chart courtesy of crypto.com.
When Coinbase Global, Inc. reported results recently, the company announced that $61 billion of USDC was currently in circulation, Connell said. That’s a 90% growth rate compared to the previous year, she added.
In 2019, after helping launch USDC, Coinbase introduced a Bootstrap Fund to help DeFi developers establish liquid marketplaces. The fund helped seed onchain liquidity for USDC across a variety of blue-chip DeFi protocols, such as Uniswap, Compound and dYdX, helping drive robust liquidity in the early innings of DeFi, Coinbase reported.
Since then, USDC has become a “leading stablecoin in DeFi” with an estimated $8.9 billion in Total Value Locked (TVL) and $2.7 trillion in annual onchain volume, Coinbase announced. USDC powers ecosystems across Ethereum, Base, Solana, Hyperliquid, Sui, Aptos and others. Coinbase is committed to accelerating further stablecoin adoption, its leaders indicated.
Michelle Connell heads Portia Capital Management.
Stablecoin Funds Offer Another Way to Invest in Cryptocurrencies: Woods’ Wisdom
Ether, also know as Ethereum, is one of the cryptocurrencies that is gaining appeal. Another rising cryptocurrency is Solana, with better-known Bitcoin showing short-term pricing weakness.
Ethereum may be the “favorite cryptocurrency” right now of Jim Woods, who heads the Crypto & Commodities Trader advisory service that recommends both stocks and options. The Ethereum platform and network continue to expand “throughout the global economy,” added Woods, who also heads the Investing Edge investment newsletter.
Woods shared a baseball analogy to describe Ethereum’s ascent. He forecast that Ethereum is in the “second or third inning” of a nine-inning gain.
“We haven’t even batted through the order yet,” Woods advised his Crypto & Commodities Trader subscribers.
Jim Woods heads Crypto & Commodities Trader.
Stablecoin Funds Offer Another Way to Invest in Cryptocurrencies: Trump Bump
Cryptocurrencies have exhibited volatility, even though the Trump administration ushered in policies to give Bitcoin a lift. With President Trump leading the cryptocurrency policy flotilla, both investors and traders have gained a figurative gust of wind that led Bitcoin to hit a new high of $124,450 on Thursday, Aug. 14, before sliding to $107,906.50 late in the day on Friday, Aug. 29, then turning upward to $111,230.00 on Tuesday, Sept. 2, before trading at $111,153.37 on Tuesday evening, Sept. 9.
After President Donald Trump won election to his second term in November 2024, the price of Bitcoin rose from roughly $70,000 to pass $124,000 on Aug. 14 but has faced volatility. The rise never is steady with Bitcoin, Ethereum or Solana, so investing in them requires patience and a willingness to resist panic-selling.
President Trump’s easing of cryptocurrency regulation has been accompanied by increasingly crypto-friendly voting in Congress, as well.
Stablecoin Funds Offer Another Way to Invest in Cryptocurrencies: Ethereum
Ether hit a low of under $1,500 in mid-April. Then, it began a strong run. It set new 52-week highs recently and neared its all-time high in 2021. During Ether’s latest gains, it left Bitcoin far behind in percentage increase.
Currently, Ether is in second place to Bitcoin, despite the latter’s recent pullback, wrote Retirement Watch investment newsletter leader Bob Carlson, a retired pension fund chairman. There are quite a few digital currencies, with many created almost every day. Relatively few of the digital currencies last, Carlson cautioned.
A distinguishing feature of Ethereum and Bitcoin is that the Securities and Exchange Commission has approved exchange-traded funds (ETFs) that buy the currencies at spot prices, Carlson continued.
One way for income investors to capitalize on Ethereum is to do so through “staking.” That technique provides a current estimated reward rate of 1.86%. It means that, on average, stakers of Ethereum earning about 1.86% if they hold an asset for 365 days. Today, the staking ratio, or the percentage of eligible tokens currently being staked, is 29.64%, according to Coinbase Global Inc. (NASDAQ: COIN).
There are 35.8 million of Ethereum staked, meaning the cryptocurrency has a staking market cap of $155.9 billion.
“This is compared to a total asset market cap of $526.2 billion,” according to Coinbase.
Stablecoin Funds Offer Another Way to Invest in Cryptocurrencies: Geopolitical Risk
After returning from Beijing, China, Russia’s President Vladimir Putin’s military hit Ukraine’s government targets in Kyiv with one of the largest air strikes in the war that now has been going for 3 1/2 years. It marked the first time a government building has been hit since Russia began its attacks.
Both investors and traders still face a threat from geopolitical risk. President Trump said on Sept. 2 that he is “very disappointed” in Russia’s President Vladimir Putin and renewed talk about taking punitive action against Russia if it keeps attacking civilians and continuing its three-plus-year invasion of Ukraine.
The Trump administration recently approved a $825 million arms sale to Ukraine for extended-range missiles and other equipment to aid its defensive capabilities. The State Department announced Thursday, Aug. 28, that it notified Congress about selling extended-range attack munition missiles and navigation systems to Ukraine. The sale includes related spare parts, components and other accessories, as well as training and technical support.
In July, the Trump administration announced two other proposed weapons sales to Ukraine, with one worth $322 million to lift air defense capabilities and provide armored combat vehicles, while the second, worth $330 million, for air defense systems, maintenance, repair and overhaul of self-propelled artillery vehicles.
Ukraine officials announced plans to use funds from United States and NATO allies Denmark, the Netherlands and Norway to pay for the equipment. The proposed sale will support the foreign policy and national security objectives of the United States by improving the security of a “partner country” that is a force for political stability and economic progress in Europe, according to the State Department.
President Trump’s optimistic talk that he could end Russia’s invasion of Ukraine soon after taking office in January 2025 has been thwarted by Putin. In fact, Russia is stepping up its attacks, hitting civilian sites and now government sites in Ukraine, as well as gaining control of additional sovereign territory in its neighboring nation.
Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce, Seeking Alpha, GuruFocus and other publications and websites. Paul, who can be followed on Twitter @PaulDykewicz, is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper. Paul also is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz. The book is great as a gift and is endorsed by Joe Montana, Joe Theismann, Ara Parseghian, “Rocket” Ismail, Reggie Brooks, Dick Vitale and many others. Call 202-677-4457 for multiple-book pricing.
