Building your own branded blockchain seems to be all the rage these days. Stripe announced Tempo, Google announced its universal ledger, and Circle announced Arc.
Smart voices in the space are asking the right questions. Chuk had a particularly good article discussing tradeoffs between "openness and control," and Christian also had a detailed take on the "centralizing forces" challenging the original blockchain ethos of decentralization.
While these points are important, I've been thinking about another angle that explains how the industry is evolving: is this move to launch branded chains really just sophisticated regulatory arbitrage?
The thought experiment
Consider this scenario:
- If I give a company $1 to hold, and they store it as a digital record on their private servers -- they're now a bank.
- If I give a company $1, they deposit it in a bank, give me a digital token, and record that on a blockchain -- suddenly they're a fintech.
Are blockchains just a fancy way for fintechs to offer banking services without the regulatory burden of actually being a bank? Of course, we've seen a version of this story before with Banking-as-a-Service ("BaaS") offerings, but stablecoins on a blockchain supercharge this model, providing superior speed, redundancy, and global interoperability.
What fintechs can offer without a bank charter
Fintechs can offer "banking-like" services without spending years jumping through hoops for a charter or relying on a bank for its underlying accounts. With stablecoins, fintechs can offer:
- Real-time money movement
- Dollar-backed savings
- Programmable lending
All of this comes out of the box with limited regulatory overhead. Deploy your own chain and then utilize a wallet provider to provision your users with "accounts." Using a non-custodial MPC solution (like Privy or Dynamic), you can be up and running in days, if not quicker.
The stablecoin story as regulatory arbitrage
One story about the rise of stablecoins is regulatory arbitrage. Individuals and businesses want access to dollars and they may live in a country that has currency controls or unfair exchange rates, but USDT gives them the opportunity to hold a digital dollar that trades like a dollar.
A funny quirk about blockchains is that if you create a wallet where access is shared and that access is on a blockchain, then all of a sudden you don't need licenses. And if ownership of the asset is backed by $1 but isn't actually $1 and that backing is just a promise, you don't need licenses.
My hypothesis
Any fintech wanting to reduce bank dependency while offering banking-like services will seriously consider building their own blockchain. It's not just about innovation -- it's about regulatory positioning and BaaS 2.0.
But is a centralized blockchain even a blockchain?
We've seen this before. Permissioned blockchains were hot in 2017/2018. Every corporate was exploring one, like they are exploring AI today, and it all fell to the side.
So what is different now?
- Liquidity
- Global adoption
- Better tooling and infrastructure
But all of this is for decentralized chains like Solana and Ethereum. Not centralized. Though L2s are pretty centralized -- Base for one.
The question remains: what's really different this time around?