Source: Veradi Verdict
Compiled by: Zhou, ChainCatcher
wraparound
Crypto-as-a-Service (CaaS) is the "software-as-a-service (SaaS) moment" in the blockchain space. Banks and fintechs no longer need to build crypto infrastructure from scratch. They can simply access APIs and white-label platforms to launch digital asset capabilities in days or weeks, rather than years like in the past. (Note: The essence of white-label is that one party provides products or technologies, and the other party labels its own brand for sale or operation.) In the financial/crypto space, it refers to the use of a third-party trading system, wallet, or payment gateway by a bank or exchange to brand itself. )
The mainstream market is accelerating its adoption through three channels. Banks are partnering with custodians like Coinbase, Anchorage, and BitGo while actively exploring tokenized assets; Fintech companies are utilizing platforms like M^0 to issue their own stablecoins; While payment processors such as Western Union ($300 billion in annual transactions) and Zelle (over $1 trillion in annual transactions) are now integrating stablecoins for instant, low-cost cross-border settlements.
Encryption as a Service (CaaS) is not complicated. It is essentially a crypto-based software-as-a-service (SaaS) that makes it a hundredfold easier for institutions and businesses to integrate into the crypto space. Banks, fintechs, enterprises, etc. no longer need to laboriously build in-house cryptocurrency features. Instead, they can simply plug and play and deploy in days with a proven API and white-label platform. Businesses can focus on their customers without worrying about the complexities of blockchain. They can leverage their existing infrastructure to engage in cryptocurrency trading in a more efficient and cost-effective manner. In other words, they can easily and seamlessly integrate into the digital asset ecosystem.
CaaS is poised for exponential growth
CaaS is a cloud-based business model and infrastructure solution that enables enterprises, fintechs, and developers to integrate cryptocurrency and blockchain capabilities into their operations without having to build or maintain the underlying technology from scratch. CaaS offers ready-to-use, scalable services, typically delivered through APIs or white-label platforms, such as crypto wallets, transaction engines, payment gateways, asset storage, custody, and compliance tools. This allows businesses to quickly offer digital asset capabilities under their own brand, reducing development costs, time, and required technical expertise. Like other "as-a-service" offerings, this model enables businesses of all sizes, from startups to established businesses, to participate in a cost-effective way. In September 2025, Coinbase Institutional listed CaaS as one of the company's largest growth areas.
Since 2013, Pantera Capital has been committed to driving CaaS through investments. We strategically invest in infrastructure, tools, and technologies to ensure CaaS can operate at scale. By accelerating back-end treasury management, custody, and wallet construction, we have significantly improved the service tier of CaaS.
Benefits of CaaS
By using CaaS to transparently integrate crypto into their systems, organizations can realize many strategic and operational benefits faster and more cost-effectively. These benefits include:
One-stop Integration and Seamless Embedding: CaaS platforms eliminate the need for custom development cycles, enabling teams to activate features in days instead of months.
Flexible Monetization Models: Businesses can choose subscription pricing for predictable costs or pay-as-you-go billing, aligning spending with revenue. Either way, a large upfront capital investment can be avoided.
Outsourcing Blockchain Complexity: Businesses can offload technical management while benefiting from a robust enterprise-grade backend, ensuring near-perfect uptime, real-time monitoring, and automated failover.
Developer-Friendly APIs and SDKs: Developers can embed wallet creation and key management functions to smoothly handle on-chain settlements, trigger smart contract interactions, and create a comprehensive sandbox environment.
White-label branding and intuitive interface: CaaS solutions are easy to customize, enabling non-technical teams to configure free structures, supported assets, and user onboarding processes.
Other value-added features: leading providers bundling ancillary services such as fraud detection based on on-chain analytics; Tax filing automation; Multi-signature fund management; and cross-chain bridging for asset interoperability.
These features transform cryptocurrency from a technological novelty into a revenue-generating product line while maintaining a focus on core business capabilities.
Three core use cases
We believe that the world is rapidly evolving towards a crypto-native environment, with individuals and businesses interacting with digital assets more and more frequently. This shift is driven by increasing user acceptance of blockchain wallets, decentralized applications, and on-chain transactions, driven by improved user interfaces, rich educational resources, and real-world applications.
However, for cryptocurrencies to truly integrate into the mainstream and become widely adopted, it is essential to build a strong and seamless bridge that bridges the gap between traditional finance (TradFi) and decentralized finance (DeFi). Institutions seek both the advantages of cryptocurrencies (speed, programmability, and global accessibility) while relying on trusted intermediaries to manage their underlying complexities: tools, security, technology stack, and liquidity provision.
Ultimately, this ecosystem convergence has the potential to gradually bring billions of users on-chain.
Use case 1: Banking
Banks are increasingly partnering with regulated crypto custodians like Coinbase Custody, Anchorage Digital, and BitGo to provide institutional-grade asset custody, insurance storage, and seamless spot trading services for digital assets like Bitcoin and Ethereum. These foundational services (custody, execution, and basic lending) represent the most achievable part of cryptocurrency integration, allowing banks to easily onboard customers without forcing them to leave the traditional banking system.
In addition to these essential elements, banks can leverage decentralized finance (DeFi) protocols to leverage idle treasury assets or customer deposits for competitive yields. For example, they can deploy stablecoins into liquidity pools of permissionless lending markets (such as Morpho, Aave, or Compound) or automated market makers (AMMs) like Uniswap, resulting in real-time, transparent returns that often outperform traditional fixed-income products.
Real-world asset (RWA) tokenization holds transformative opportunities. Banks can initiate and distribute on-chain versions of traditional securities (e.g., tokenized U.S. Treasuries, corporate bonds, private credit, and even real estate funds issued through BlackRock's BUIDL fund) to bring off-chain value to public blockchains such as Ethereum, Polygon, or Base. These RWAs can then be traded peer-to-peer through DeFi protocols such as Morpho (for optimized lending), Pendle (for yield splitting), or Centrifuge (for private credit pools), while ensuring KYC/AML compliance through whitelisted wallets or institutional vaults. RWAs can also serve as high-quality collateral in the DeFi lending market.
Crucially, banks can provide seamless access to stablecoins without causing customer churn. Through embedded wallets or custodial sub-accounts, customers can hold USDC, USDT, or FDIC-insured digital dollars (for payments, remittances, or yield-based banking) directly in the banking app without leaving the bank's ecosystem. This "walled garden" model is similar to neobanks but with regulated trust.
Looking ahead, major banks may form alliances to issue branded stablecoins backed 1:1 by centralized reserves. These stablecoins can be settled instantly on public chains while complying with regulatory requirements, bridging traditional finance with programmable currencies.
If a bank sees blockchain as infrastructure rather than an affiliate tool, it is likely to gain the next trillion dollars in value.
Use case 2: Fintech companies and new banks
Fintech companies and neobanks are rapidly integrating cryptocurrencies into their core offerings through strategic partnerships with established platforms like Robinhood, Revolut, and Webull. These collaborations enable seamless use and secure custody of digital assets while providing instant trading of tokenized versions of traditional stocks, effectively bridging the gap between traditional finance and blockchain-based marketplaces.
In addition to partnerships, fintechs can build and launch their own blockchain infrastructure with the help of professional service providers like Alchemy. Alchemy is a leader in blockchain development platforms, offering scalable node infrastructure, enhanced APIs, and developer tools that simplify the creation of custom Layer-1 or Layer-2 networks. This allows fintechs to tailor blockchains for specific use cases, such as high-throughput payments, decentralized authentication, or RWA (Risk Weight Delegation), while ensuring compliance with evolving regulatory requirements and optimizing low latency and cost-effectiveness.
Fintech companies can further deepen their involvement in the crypto space by issuing their own stablecoins and leveraging decentralized protocols offered by platforms like M^0 to mint yieldable, interchangeable stablecoins backed by high-quality collateral like U.S. Treasuries. By adopting this model, fintech companies can mint their own tokens on demand, have full control over the underlying economic mechanisms (including interest accumulation and redemption mechanisms), ensure regulatory compliance through transparent on-chain reserves, and participate in common governance through decentralized autonomous organizations (DAOs). Additionally, they benefit from enhanced liquidity pools in major exchanges and DeFi protocols, reducing fragmentation and increasing user adoption. This approach not only creates new revenue streams but also positions fintechs as innovators in the programmable money space and fosters customer loyalty in the competitive digital economy.
Use case 3: Payment processors
Payment companies are building stablecoin "sandwiches": a multi-tiered cross-border settlement system that receives fiat currency on one end and outputs instant, low-cost liquidity in another jurisdiction while minimizing foreign exchange spreads, intermediary fees, and settlement delays. The components of a "sandwich" include:
Top Slice (Entry Point): US customers send USD to payment providers such as neobanks such as Stripe, Circle, Ripple, or Mercury.
Filling (minting): Dollars are immediately exchanged for regulated stablecoins at a 1:1 ratio – typically USDC (Circle), USDP (Paxos), or digital dollars issued by banks.
Bottom slice (export): Stablecoins become local currency stablecoins through bridging or exchange – e.g., aARS (pegged to Argentine peso), BRLA (Brazil), or MXNA (Mexico) – or directly become central bank digital currency pilot projects (e.g., Drex in Brazil).
Settlement: Funds arrive at a local bank account, mobile wallet, or merchant payment at T+0 (instant), typically at a total cost of less than 0.1%, compared to 3-7% via SWIFT + correspondent banks.
Western Union, a 175-year-old money transfer giant with over $300 billion in annual remittances, recently announced the integration of stablecoins into its ecosystem. Pantera Capital CEO Devin McGranahan said in July 2025 that the company has historically been "cautious" about cryptocurrencies, concerned about their volatility and regulatory issues. But the introduction of the Genius Act changed that.
"As the rules become clearer, we see real opportunities to integrate digital assets into the business," McGranahan said on the Q3 2025 earnings call. The result: Western Union is currently actively testing stablecoin solutions for treasury settlements and customer payments, leveraging blockchain technology to get rid of the cumbersome process of correspondent banking.
Bank-backed P2P payment giant Zelle (part of JPMorgan Chase, Bank of America, Wells Fargo and others) has made more than $1 trillion in fee-free transfers within the United States every year through simple mobile phone numbers or email addresses, and now has more than 2,300 partner institutions and 150 million users. However, cross-border payments have not been realized before. On October 24, 2025, Early Warning announced a stablecoin plan aimed at bringing Zelle to international markets, offering "the same speed and reliability" overseas.
As banks, fintech/neobanks, and payment processors integrate cryptocurrencies in an intuitive, plug-and-play, compliant way (with as few regulators as possible), they can continue to expand their global reach and strengthen relationships.
conclusion
CaaS is not hype – it represents a change in infrastructure that makes cryptocurrencies invisible to end users. Just as people don't think of AWS when they watch Netflix or Salesforce when they look at CRM, consumers and businesses don't think of blockchain when making instant cross-border payments or accessing tokenized assets. The winners of this change are not those companies that add cryptocurrencies as an after-the-fact to traditional systems, but institutions and businesses that see blockchain as infrastructure, and investors who support the underlying technology that underpins it all.
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