“Despite earlier fears of a looming recession, rising interest rates, and geopolitical uncertainty, markets continue to prove remarkably resilient. U.S. retail sales for June rose by 0.6%, handily beating the 0.1% forecast and rebounding from the previous month’s decline. At the same time, initial jobless claims dropped to 221,000, versus an expected increase to 235,000.

These positive surprises helped propel the S&P 500 to a new record high, and investor sentiment remains strong as inflation continues to moderate. It’s another reminder that staying the course through short-term volatility can be rewarding over the long run.

Crypto Markets Surge on Regulatory Clarity

Beyond equities, one of the most compelling stories this week came from the crypto space. In a major milestone for the industry:

• The U.S. House passed the Digital Asset Market Clarity Act, designed to regulate the broader crypto industry.

• The Stablecoin Regulation Genius Act, which outlines rules for stablecoins backed 1:1 by U.S. dollars or Treasuries, has also passed the Senate and now awaits the President’s signature.

• In another pro-crypto move, President Trump is reportedly preparing an executive order to allow 401(k) plans to invest in digital assets, private equity, and gold.

These developments helped Bitcoin surge to nearly $121,000, with other major cryptocurrencies also rallying. This level of policy support signals a growing effort to legitimize the digital asset space and integrate it into the traditional financial system.

Why Stablecoins Matter – A Better Financial Infrastructure

One of the most transformative aspects of these regulatory changes involves stablecoins—digital tokens pegged 1:1 to U.S. dollars and backed by highly liquid assets like Treasury bills. These allow for instant, nearly free global money transfers, and the implications are massive.

While sending money between Canadians via e-Transfer may be quick and free, international transactions are often slow, expensive, and error-prone. Today, many businesses and individuals pay 1–3% per transfer, with delays stretching days or even weeks. Stablecoins replace this legacy system with real-time, low-cost transfers, regardless of borders. 

Think of it like the shift from long-distance phone charges to free internet calling. That transition saved billions. Similarly, this innovation could eliminate billions in global transaction fees and boost profit margins across industries.

This matters not just for convenience, but for economic productivity. When companies and individuals no longer lose 1% or more to transfer fees, that money drops straight to the bottom line. These savings can be reinvested, used to lower costs for consumers, or simply kept as increased earnings. It’s an economic efficiency upgrade with wide-reaching benefits.

A Strategic Buyer for U.S. Debt

Another overlooked but important angle is that the rapid growth of stablecoins also creates a new buyer for U.S. Treasuries. Since each dollar of stablecoin must be backed 1:1—typically with short-term government debt—this creates consistent demand for those assets.

At a time when the U.S. government is issuing significant debt and struggling to attract new buyers, stablecoin providers represent a built-in, reliable source of demand. It’s a win-win: the crypto sector gets legitimacy and access, and the U.S. gains a stable channel to finance its operations at scale.

Banking Comparison: Trust and Liquidity

A common question is: why trust a stablecoin over a traditional bank deposit?

When you deposit $10,000 into a bank, that money isn’t held in cash—it’s lent out multiple times. That’s the basis of fractional reserve banking, and it’s why bank runs can occur. By contrast, if you own $10,000 in stablecoins, 100% of those funds are held in liquid U.S. Treasuries, redeemable on demand.

In terms of transparency and actual backing, stablecoins may be safer in some respects—especially during times of banking stress. This dynamic is one reason why more institutions are entering the space, creating their own stablecoins to improve efficiency and reduce operating costs.

What This Means for Your Portfolio

We’ve been tracking and investing in this space for some time, and these developments only strengthen the case for select exposure to digital asset infrastructure and blockchain-related technologies. While we approach this space with caution, given its volatility and evolving regulatory landscape, we see long-term potential in these innovations.

As always, these investments are made within a diversified, risk-managed framework and tailored to each client's objectives and comfort level.

Looking Ahead

The broader story here is one of technological transformation. Just as the internet redefined communication and commerce, blockchain and digital finance are reshaping how money moves. While these changes may not immediately impact our day-to-day banking in Canada, global industries are already feeling the effects—and the benefits are real.”

To listen to Mark’s CBC interview on tips and pitfalls of buying individual stocks please click here.

 If you have any questions on the markets, or would like to discuss your investments, please don’t hesitate to reach out to Mark, your Portfolio Manager. All of us are available to address any questions or concerns regarding personal finance.

 Sincerely,

  Mark, Leanne, and James

Book an appointment with Mark:  https://calendly.com/mark-ting

Book an appointment with Leanne:  https://calendly.com/leanne-brothers

Book an appointment with James:  https://calendly.com/james-pelmore

Foundation Wealth Partners LP is registered as a Portfolio Manager and Exempt Market Dealer in all Canadian provinces and the Yukon Territory. Certain statements in this email are forward-looking. Forward-looking statements (“FLS”) are statements that are predictive in nature, depend on or refer to future events or conditions, or that include words such as “may,” “will,” “should,” “could,” “expect,” “anticipate,” intend,” “plan,” “believe,” “estimate” or other similar expressions. Statements that look forward in time or include anything other than historical information are subject to risks and uncertainties, and actual results, actions or events could differ materially from those set forth in the FLS. FLS are not guarantees of future performance and are by their nature based on numerous assumptions. Although the FLS contained in this document are based upon what Foundation Wealth Partners believe to be reasonable assumptions, Foundation Wealth Partners cannot assure that actual results will be consistent with these FLS. The reader is cautioned to consider the FLS carefully and not to place undue reliance on the FLS. Unless required by applicable law, it is not undertaken, and specifically disclaimed, that there is any intention or obligation to update or revise FLS, whether as a result of new information, future events or otherwise. 

If you have questions about any of these developments—or want to explore how your portfolio is positioned for this evolving landscape—please don’t hesitate to reach out.