A Labour Party in Tory clothing? Why Starmer’s backbenchers are deeply uncomfortable

Published

1 day ago

March 17, 2025

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Since taking office nine months ago Sir Keir Starmer has weathered party rows about winter fuel payments, the two child benefit cap, WASPI women, airport expansion and cuts to international aid.

All of these decisions have been justified in the name of balancing the books – filling that notorious £22bn black hole, sticking to the fiscal rules, and in the pursuit of growth as the government’s number one priority.

But welfare reform feels like a far more existential row.

Health Secretary Wes Streeting argued on Sunday Morning With Trevor Phillips that the current system is “unsustainable”.

Ministers have been making the point for weeks that the health benefits bill for working-age people has ballooned by £20bn since the pandemic and is set to grow by another £18bn over the next five years, to £70bn.

But the detail of where those cuts could fall is proving highly divisive.

One proposal reportedly under consideration has been to freeze personal independence payments (PIPs) next year, rather than uprating them in line with inflation.

Charities have warned this would be a catastrophic real-terms cut to 3.6 million people.

Concerned left-wing backbenchers are calling on the government to tax the rich, not take from the most vulnerable.

The Sunday Times and Observer have now reported that Work and Pensions Secretary Liz Kendall has dropped the idea in response to the backlash.

Wes Streeting denied reports of a cabinet row over the plan, insisting the final package of measures hasn’t yet been published and he and his cabinet colleagues haven’t seen it.

Not the final version perhaps – but given all backbench Labour MPs who were summoned to meetings with the Number 10 policy teams for briefings this week, that response is perhaps more than a little disingenuous.

In his interview with Sir Trevor Phillips, he went on to make the broader case for PIP reform – highlighting the thousand people who sign up to the benefit every day and arguing that the system needs to be “sustainable”, to “deliver for those that need it most” and “provide the right kind of support for the different types of need that exist”.

To me this signals the government are preparing to unveil a tighter set of PIP eligibility criteria, with a refocus on supporting those with the greatest needs.

Changes to incapacity benefit to better incentivise working – for those who can – are also clearly on the cards.

The health secretary has been hitting out at the “overdiagnosis” of mental health conditions, arguing that “going out to work is better for your mental and physical health, than being spent and being stuck at home”, and promising benefit reforms that will help support people back to work rather than “trapped in the benefits system”.

Turning Tory?

Starmer said this week the current welfare system couldn’t be defended on economic or moral grounds.

The Conservatives don’t disagree.

Before the election, they proposed £12bn in cuts to the welfare bill, with a focus on getting people on long-term sickness back to work.

This morning, shadow education secretary Laura Trott claimed Labour denied that welfare cuts were needed during the election campaign and had wasted time in failing to include benefits reform in the King’s Speech.

“They’re coming to this chaotically, too late and without a plan,” she said.

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Notwithstanding the obvious critique that the Tories had 14 years to get a grip on the situation – what’s most striking here is that, yet again, the Labour government seems to be borrowing Conservative clothes.

When challenged by Sir Trevor this morning, Streeting denied they were turning Tory – claiming the case for welfare reform and supporting people into work is a Labour argument.

But, from increasing defence spending and cutting the aid budget to scrapping NHS England, there’s a definite pattern emerging.

If you didn’t know a Labour administration was in charge, you might have assumed these were the policies of a Conservative government.

It’s a strategy which makes many of his own backbenchers deeply uncomfortable.

But it’s doing a good job of neutering the Tory opposition.

Politics

Eliminating archaic payments systems with stablecoins

Published

1 hour ago

March 18, 2025

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Eliminating archaic payments systems with stablecoins

Opinion by: Simon McLoughlin, CEO at Uphold

2021 witnessed a fintech investment boom, with startups raising approximately $229 billion globally. Higher interest rates and tighter economic circumstances have since tempered that exuberance, but funds continue to pile into the sector. Indeed, the global fintech sector is expected to see a rebound in investment activity throughout 2025.

Why are investors continuing to bet big on this sector? The answer is simple. The current international finance system is in urgent need of modernization. Built for a pre-internet age, it relies on outdated processes, chains of intermediaries and a patchwork of non-standard regulations.

An aging and expensive system

Take SWIFT as a case in point. Founded in 1973, SWIFT remains the backbone of cross-border payments. SWIFT is nothing more than a messaging system that enables banks to communicate around transactions. It was never designed to manage funds or process transactions. As a result, a “make do and mend” approach has grown around international payments, characterized by a proliferation of intermediaries and local payment rails.

This antiquated, fragmented system creates significant friction in cross-border transactions, leading to delays, high costs and limited choice for individuals and businesses outside major economic blocs. Fees for international payments currently average 1.5% for businesses and all the way up to 6.3% for remittances. Payments can take up to several days to reach recipients.

This system hinders global commerce and exacerbates financial exclusion, particularly in the global south, where volatile local currencies and limited access to traditional banking services are common.

Many of these friction points could be resolved by stablecoins, making transferring money across borders as easy as sending an email. Indeed, the blockchain-based currency has the potential to revolutionize global finance.

Democratizing access to fiat currencies

For people in countries with volatile economies or unstable governments, stablecoins offer a safe haven for savings. Stablecoins pegged 1:1 to a fiat currency such as the US dollar provide consumers in these regions with a way to escape their national financial system with a trustworthy and transparent alternative that protects them from inflation and currency devaluation. This is particularly important in the global south, where economic instability can erode the value of hard-earned income and savings.

According to UBS, consumers in developing countries are also attracted to stablecoins due to the lower risk of government interference with the currency. The wealth management firm believes stablecoins are increasingly seen as “digital dollars” and used for everything from savings to transactions to remittances in these regions.

Empowering small businesses and freelancers

Stablecoins can significantly reduce the costs and complexities associated with international payments, enabling small businesses and freelancers to participate in the global marketplace on a more level playing field. This opens up new opportunities for entrepreneurship and economic growth in developing countries.

Recent: Dubai recognizes USDC, EURC as first stablecoins under token regime

In our current payment system, physical money does not cross borders — only information does. A payroll company looking to pay a freelancer in a third country cannot do so directly and must use systems like Stripe, which uses virtual bank accounts to get around the problem.

With stablecoins, payroll companies can pay in any currency to any currency, using crypto on- and off-ramps to facilitate the payment. The business pays in dollars, for example, which is on-ramped to Tether’s USDt (USDT) and sent to the freelancer’s digital wallet, where they can either keep it or off-ramp it to their local currency. Stablecoins will prove to be, and are, a vital tool in helping businesses access global talent and fill their skills gaps.

Facilitating financial inclusion

Through offering an alternative to traditional banking systems, stablecoins also provide financial services to the unbanked and underbanked populations. This can be particularly transformative in regions with limited access to traditional financial infrastructure or in countries like Argentina, where there is low confidence in the national monetary system.

According to the Bank for International Settlements, stablecoins can enable a wide range of payments and provide a gateway to other financial services, replicating the role of transaction accounts as a stepping stone to broader financial inclusion.

Given their ability to provide access to financial services anywhere with an internet connection, stablecoins are seeing explosive growth in emerging markets. Use cases are expanding rapidly across Africa, Latin America, and parts of developing Asia, where they are being used to hedge against inflation, for remittances and cross-border payments, and as a simpler alternative to US dollar banking. This growth trajectory can be expected to continue in the years ahead.

A shot in the arm for global business

Stablecoins are rapidly rising in popularity and already total more than $233 billion in market capitalization, while transaction volumes in 2024 reached $15.6 trillion, surpassing those of Visa. In an increasingly uncertain world, they offer a stable, low-cost and rapid means of transferring money across borders, helping to increase financial inclusion and smooth access to global talent for employers. Stablecoins are a digital-first financial tool for a digital-first world and are ideally suited to replacing the current archaic international payments system.

Opinion by: Simon McLoughlin, CEO at Uphold

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Politics

Coinbase stock may rally to $310 on Trump-led crypto policies

Published

5 hours ago

March 18, 2025

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Coinbase stock may rally to 0 on Trump-led crypto policies

Coinbase exchange’s stock price has received an optimistic price prediction from a Bernstein analyst, citing improving crypto regulatory clarity in the world’s largest economy.

Gautam Chhugani, an analyst at global asset management firm Bernstein, initiated coverage of Nasdaq-listed Coinbase (COIN) stock with an outperform rating and a price target of over $310.

The analyst expects improving mainstream cryptocurrency adoption, driven by US President Donald Trump’s administration, which intends to make crypto policy a national priority and make the US a global hub for blockchain innovation, according to a Bernstein research note seen by Tipranks.

If Coinbase shares manage to rise to $310, it would mean an over 64% rally from the current $188 mark, Google Finance data shows.

Coinbase stock may rally to $310 on Trump-led crypto policies — *COIN/USD, all-time chart. Source: Google* *Finance*

The bullish price prediction comes over a week after Trump hosted the first White House Crypto Summit on March 7, shortly before he signed an executive order that outlined a plan to create a Bitcoin reserve using cryptocurrency forfeited in government criminal cases, Cointelegraph reported.

Coinbase stock may surge on improving crypto regulatory clarity in the US

Coinbase is set to benefit from crypto’s “ascendancy to the US financial mainstream” amid improving regulations, mainly due to the firm offering a one-stop platform for numerous crypto activities, wrote the research note, adding:

“COIN is described as a crypto exchange, but it is actually what a universal Bank would look like in the world of blockchain-based financial services.”

“COIN offers an exchange, broker/dealer, institutional prime desk, stablecoin banking, crypto payments, custodian bank, software and blockchain ecosystem services, all combined into a full stack ‘Amazon’ of crypto financial services,” added the report.

Crypto regulation is heading in a positive direction, with some analysts seeing the US Bitcoin reserve plan as the first “real step” for Bitcoin’s integration into the global financial system.

“The US has taken its first real step toward integrating Bitcoin into the fabric of global finance, acknowledging its role as a foundational asset for a more stable and sound monetary system,” Joe Burnett, head of market research at Unchained, told Cointelegraph.

While Trump has previously highlighted his intentions to bolster crypto innovation in the US, issuing regulatory frameworks takes time and setting the “right regulatory tone” will be crucial for the administration, according to Anastasija Plotnikova, co-founder and CEO of Fideum — a regulatory and blockchain infrastructure firm focused on institutions.

Magazine: Bitcoin’s odds of June highs, SOL’s $485M outflows, and more: Hodler’s Digest, March 2 – 8

Politics

Xapo Bank launches Bitcoin-backed USD loans targeting hodlers

Published

6 hours ago

March 18, 2025

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Xapo Bank launches Bitcoin-backed USD loans targeting hodlers

Xapo Bank, a global cryptocurrency-friendly bank headquartered in Gibraltar, is betting on crypto lending revival by launching Bitcoin-backed US dollar loans.

Qualifying Xapo Bank clients can now access Bitcoin (BTC) loans of up to $1 million, the firm said in an announcement shared with Cointelegraph on March 18.

The new lending product is designed for long-term Bitcoin hodlers who want to access cash while keeping their BTC, Xapo Bank CEO Seamus Rocca told Cointelegraph.

“Unlike traditional assets, Bitcoin is an ideal form of collateral — it is borderless, highly liquid, available 24/7, and easily divisible, making it uniquely suited for lending,” Rocca said.

No collateral re-usage

A key distinction of Xapo’s Bitcoin loan product is that the bank does not rehypothecate the loan collateral by users, meaning that its lending mechanism does not involve the re-usage of BTC assets by clients.

Instead, the Bitcoin collateral is stored in Xapo’s BTC vault using institutional multiparty computation (MPC) custody.

Eligible Xapo clients can choose repayment schedules of 30, 90, 180 or 365 days, with no penalties for early repayment, the firm said.

Who is eligible?

Xapo’s new Bitcoin lending offering will be available to pre-approved members based on several criteria.

The key criteria for eligibility are the amount of Bitcoin holdings and the period of holdings, as Xapo specifically targets long-term BTC holders with a long-term investment strategy.

According to the bank, the offering will be available to global investors in regions like Europe and Asia, excluding residents of the United States.

Xapo Bank is regulated by the Gibraltar Financial Services Commission under the Financial Services Act 2019. In 2024, the bank successfully passported its banking license in the United Kingdom, granting its Xapo Bank App full access to the country.

While Xapo’s lending is offered across the European Union, crypto lending is not covered by local regulations like the Markets in Crypto-Assets framework.

A revival following numerous collapses

Xapo Bank’s new BTC loan launch comes a few years after the crypto lending industry suffered a major crisis in 2022.

The crisis came amid the historic Terra crash and a subsequent bear market that triggered the collapses of major lending providers like Celsius and BlockFi.

“The collapse of Celsius, BlockFi, and other centralized lenders significantly eroded trust in the crypto lending space,” Xapo Bank CEO told Cointelegraph.

“Borrowers today exercise greater caution, prioritizing platforms with a proven track record in Bitcoin custody and those that offer secure, transparent solutions — especially ones that do not engage in rehypothecation,” Rocca said, adding:

“At the same time, demand for Bitcoin-backed loans is on the rise, particularly among high-net-worth individuals and institutional investors who seek liquidity without selling their Bitcoin holdings.”

In addition to removing asset rehypothecation and MPC security, Xapo offers risk management tools and proactive protection to prevent automatic liquidations.

“In the event of a Bitcoin price drop, customers receive instant notifications, allowing them to either top up their collateral or make partial repayments to maintain their loan status,” Rocca noted.

Xapo is not the only firm that has been working to introduce lending products in 2025. In early March, Bitcoin developer Blockstream secured a multibillion-dollar investment to launch three new institutional funds, with two of them offering BTC lending.

Magazine: ETH may bottom at $1.6K, SEC delays multiple crypto ETFs, and more: Hodler’s Digest, March 9 – 15