Branded Blockchains: The New Regulatory Arbitrage?

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 on this discussing tradeoffs between “openness and control,” and Christian also had a detailed take on the “centralizing forces” that are 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?

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.

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 a Privy or Dynamic), you can be up and running in days, if not quicker.

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.