Regulator Actions Rock Stablecoins, Coinbase (COIN)


Looks like Bitcoin (BTC-USD), Ether (ETH-USD) and friends are going to turn in another solid day. But elsewhere in the New Digital World, there are some major regulatory headaches going on… Although one of my favorite metaverse plays, Matterport (NASDAQ:MTTR), is having a great day. Let’s dig in now.

A concept image for Stablecoin displayed on a blue and green ticker tape. USDD is a stablecoin.
Source: Shutterstock

Regulator Actions Rock Stablecoins, Coinbase

Remember how Circle had to “blacklist” wallets with its USD Coin (USDC-USD) stablecoin that belonged to Tornado Cash, after Monday’s sanctions?

This has not been good for USDC’s market cap. (Since it’s a stablecoin, the price typically stays close to $1.00… So, this is how we can gauge people’s enthusiasm for the coin.)

And evidently, Dai (DAI-USD) stablecoin is “heavily backed by USDC”: 33.9%, as the team behind DAI told The Defiant yesterday. The market cap of this decentralized stablecoin hasn’t really reacted to the Tornado Cash situation. At least, not negatively

But there’s a lot of worry about who might come into the Treasury Department’s crosshairs next: “Every DeFi protocol is thinking about reducing their USDC exposure.”

Circle is clearly playing ball with the Feds, as I noted Tuesday… It seems a very different situation than their customers at Tornado Cash – whose product is explicitly designed to let you make transactions undetected!

I’m no blockchain forensic analyst. But I imagine FinCEN (at the Treasury Dept.) has them – and I do know that Circle is already registered with them, plus reports to state regulators.

Still, this is well worth keeping your eye on, as stablecoins are crucial “infrastructure” in the crypto markets. And with its strong reserves of (actual) cash and “equivalents,” USDC is often regarded as the best one.

Meanwhile: Coinbase (NASDAQ:COIN) is under additional scrutiny. We already saw that the SEC is interested in whether Coinbase is listing unregistered securities – accusing nine specific (and very tiny) crypto offerings of this…

Now in its 10-Q Financial Statements filed with the quarterly results… Coinbase said that its “investigative subpoenas and requests from the SEC” also concern “its staking programs, and its stablecoin and yield-generating products.” (The stablecoin reference would also relate to USDC.)

Coinbase is also the type to play ball: “The SEC threatened to sue Coinbase last September over its proposed lending accounts, which would have offered up to 4% interest on USD coin deposits. Coinbase walked back those plans later that month after initial opposition,” Blockworks reminds us.

“The firm offers separate staking and yield programs on certain DeFi tokens”… But according to the 10-Q: While these investigations may affect “operations for a particular period,” ultimately Coinbase believes that this can all be resolved without “a material adverse effect.” Stay tuned!

Matterport Raised Its Revenue & Earnings Expectations for 2022

Could Matterport (NASDAQ:MTTR) finally be turning things around? The digital-twin company saw shares rocket +40% this morning – after turning in its quarterly report overnight.

Q2 revenues were $28.5 million – whereas analysts had expected more like $30 million. And “earnings” of -$0.12, while better than expected, were still down from -$0.03 in the year-ago quarter.

So most likely, investors are responding to Matterport’s forward outlook:

For 2022, “the company raised its revenue guidance to a range of $132 million to $138 million, up from $125 million to $135 million previously,” my InvestorPlace colleague Joel Baglole reports. While Matterport expects 2022 “earnings” between -$0.46 and -$0.50, this is also a little better than prior guidance (-$0.47 to -$0.52).

This implies Matterport sees a nice turnaround on the horizon. MTTR has turned in $57 million revenues in 2022 to date. It expects roughly $36 million in Q3. So, given the 2022 guidance, it must also expect something like $42 million in Q4 revenues.

This would be +30% revenue growth in Q3, year-over-year, then +55% revenue growth in Q4. (Versus these latest Q2 figures, which were -3.5% year-over-year.) I imagine that would help MTTR climb out of the hole it’s been stuck in all year!

Subscribers and Spaces Under Management continued to climb already in Q2, up +52% and +44%, respectively. Matterport has now captured 24 billion square feet of digital twins in 177 countries and serves 23% of the Fortune 1000.

Below is a peek at one of Matterport’s digital twins: a GUESS? store. Those circles on the floor are how you can “walk around” the digital twin, as you may have done with real-estate listings (big business for Matterport!)

Source: Matterport

Retail is a huge opportunity to cash in on 3D digital worlds, as I’ve highlighted with Snap Inc. (NYSE:SNAP). Apps are how Gen Z likes to shop – and I’m inclined to agree. I can’t wait to see what Matterport, as the market leader in digital twins, does with the opportunity in the next few years.

On the date of publication, Ashley Cassell did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines. To have more news from The New Digital World sent to your inbox, click here to sign up for the newsletter.

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