Source: VeradiVerdict

Compiled by: Zhou, ChainCatcher

Summary

Crypto as a Service (CaaS) is the "Software as a Service (SaaS) moment" in the blockchain space. Banks and fintech companies no longer need to build crypto infrastructure from scratch. They can simply connect to APIs and white-label platforms to launch digital asset features in days or weeks, rather than spending years as in the past. Note: White-label essentially refers to one party providing a product or technology, while another party brands it for sale or operation. In the financial/crypto space, it means banks or exchanges using third-party trading systems, wallets, or payment gateways, and branding them as their own.

The mainstream market is accelerating adoption through three channels. Banks are collaborating with custodians like Coinbase, Anchorage, and BitGo, while actively exploring tokenized assets; fintech companies are issuing their own stablecoins using platforms like M^0; and payment processors like Western Union (with an annual transaction volume of $300 billion) and Zelle (with an annual transaction volume exceeding $1 trillion) are now integrating stablecoins for instant, low-cost cross-border settlements.

Crypto as a Service (CaaS) is not complicated. It is essentially a software as a service (SaaS) based on cryptocurrency, making it a hundred times easier for institutions and businesses to integrate into the cryptocurrency space. Banks, fintech companies, and enterprises no longer need to struggle to build internal cryptocurrency capabilities. Instead, they can simply plug and play, deploying in days through proven APIs and white-label platforms. Businesses can focus on their customers without worrying about the complexities of blockchain. They can leverage existing infrastructure to participate in cryptocurrency trading more efficiently and cost-effectively. In other words, they can seamlessly integrate into the digital asset ecosystem.

CaaS is Ready for Exponential Growth

CaaS is a cloud-based business model and infrastructure solution that enables businesses, fintech companies, and developers to integrate cryptocurrency and blockchain capabilities into their operations without building or maintaining the underlying technology from scratch. CaaS offers ready-to-use, scalable services, typically delivered through APIs or white-label platforms, such as crypto wallets, trading engines, payment gateways, asset storage, custody, and compliance tools. This allows businesses to quickly offer digital asset features under their own brand, reducing development costs, time, and required technical expertise. Like other "as-a-service" products, this model enables businesses of all sizes, from startups to mature enterprises, to participate in a cost-effective manner. By September 2025, Coinbase Institutional listed CaaS as one of its company's largest growth areas.

Since 2013, Pantera Capital has been committed to driving the development of CaaS through investments. We strategically allocate funds to infrastructure, tools, and technologies to ensure CaaS can operate at scale. By accelerating the construction of backend fund management, custody, and wallets, we significantly enhance the service level of CaaS.

Advantages of CaaS

Businesses using CaaS to transparently integrate crypto capabilities into their systems can achieve numerous strategic and operational advantages more quickly and cost-effectively. These advantages include:

• One-stop integration and seamless embedding: CaaS platforms eliminate the need for custom development cycles, allowing teams to activate features in days instead of months.
• Flexible monetization models: Businesses can choose subscription pricing for cost predictability or opt for a pay-as-you-go billing model that aligns spending with revenue. Either way, it avoids significant upfront capital investment.
• Outsourcing blockchain complexity: Businesses can offload technical management while benefiting from a robust enterprise-grade backend, ensuring near-perfect uptime, real-time monitoring, and automatic failover.
• Developer-friendly APIs and SDKs: Developers can embed wallet creation and key management features, smoothly handle on-chain settlements, trigger smart contract interactions, and create comprehensive sandbox environments.
• White-label branding and intuitive interfaces: CaaS solutions are easy to customize, enabling non-technical teams to configure fee structures, supported assets, and user onboarding processes.
• Additional value-added features: Leading providers bundle auxiliary services, such as fraud detection based on on-chain analytics; tax reporting 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 the world is rapidly evolving toward a cryptocurrency-native environment, with individuals and businesses increasingly interacting with digital assets. The driving force behind this shift is the growing acceptance of blockchain wallets, decentralized applications, and on-chain transactions, aided by continuously improving user interfaces, rich educational resources, and practical application value.

However, to truly integrate cryptocurrency into the mainstream and achieve widespread adoption, a robust and seamless bridge must be built to close the gap between traditional finance (TradFi) and decentralized finance (DeFi). Institutions seek the advantages of cryptocurrency (speed, programmability, and global accessibility) while relying on trusted intermediaries to manage the underlying complexities: tools, security, tech stacks, and liquidity provision.

Ultimately, this ecosystem integration has the potential to gradually bring billions of users on-chain.

Use Case 1: Banks

Banks are increasingly collaborating with regulated cryptocurrency custodians like Coinbase Custody, Anchorage Digital, and BitGo to provide institutional-grade custody, insured storage, and seamless spot trading services for digital assets like Bitcoin and Ethereum. These foundational services (custody, execution, and basic lending) represent the easiest aspects of cryptocurrency integration, allowing banks to easily onboard clients without forcing them out of the traditional banking system.

In addition to these basic elements, banks can leverage decentralized finance (DeFi) protocols to earn competitive yields on idle treasury assets or customer deposits. For example, they can deploy stablecoins into permissionless lending markets (like Morpho, Aave, or Compound) or liquidity pools of automated market makers (AMMs) like Uniswap, earning real-time, transparent returns that often outperform traditional fixed-income products.

Tokenization of real-world assets (RWA) holds transformative opportunities. Banks can initiate and distribute on-chain versions of traditional securities (e.g., tokenized U.S. Treasuries, corporate bonds, private credit, or even real estate funds issued through BlackRock's BUIDL fund), bringing off-chain value onto public blockchains like Ethereum, Polygon, or Base. These RWAs can then be traded peer-to-peer through DeFi protocols like 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 DeFi lending markets.

Crucially, banks can provide seamless access to stablecoins without causing customer attrition. Through embedded wallets or custodial sub-accounts, customers can hold USDC, USDT, or FDIC-insured digital dollars (for payments, remittances, or yield-generating investments) directly within the bank's application, without leaving the bank's ecosystem. This "walled garden" model resembles neobanks but with regulated trust.

Looking ahead, major banks may form alliances to issue brand stablecoins backed 1:1 by centralized reserves. These stablecoins could settle instantly on public chains while meeting regulatory requirements, connecting traditional finance with programmable money.

If a bank views blockchain as infrastructure rather than an ancillary tool, it is likely to capture the next trillion-dollar value.

Use Case 2: Fintech Companies and Neobanks

Fintech companies and neobanks are rapidly integrating cryptocurrency into their core products by establishing 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 traditional stock tokenized versions, effectively bridging the gap between traditional finance and blockchain-based markets.

In addition to partnerships, fintech companies can build and launch their own blockchain infrastructure with the help of specialized service providers like Alchemy. Alchemy is a leading player in the blockchain development platform space, offering scalable node infrastructure, enhanced APIs, and developer tools that simplify the creation of custom Layer-1 or Layer-2 networks. This allows fintech companies to tailor blockchains for specific use cases, such as high-throughput payments, decentralized identity verification, or RWA (risk-weighted authorization), while ensuring compliance with evolving regulatory requirements and optimizing for low latency and cost-effectiveness.

Fintech companies can further deepen their involvement in cryptocurrency by issuing their own stablecoins and leveraging decentralized protocols provided by platforms like M^0 to mint yield-generating, interchangeable stablecoins backed by high-quality collateral like U.S. Treasuries. By adopting this model, fintech companies can mint their own tokens on demand, fully control the underlying economic mechanisms (including interest accrual and redemption processes), ensure regulatory compliance through transparent on-chain reserves, and participate in governance through decentralized autonomous organizations (DAOs). Additionally, they can 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 fintech companies as innovators in the programmable money space, fostering customer loyalty in a competitive digital economy.

Use Case 3: Payment Processors

Payment companies are building a stablecoin "sandwich": a multi-layer 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 the "sandwich" include:

Top Slice (Entry): U.S. customers send dollars to payment providers (like Stripe, Circle, Ripple, or new banks like Mercury).

Filling (Minting): Dollars are immediately exchanged 1:1 for a regulated stablecoin—typically USDC (Circle), USDP (Paxos), or bank-issued digital dollars.

Bottom Slice (Exit): The stablecoin is bridged or exchanged into local currency stablecoins—such as aARS (Argentine peso-pegged), BRLA (Brazil), or MXNA (Mexico)—or directly into central bank digital currency pilot projects (like Brazil's Drex).

Settlement: Funds arrive in local bank accounts, mobile wallets, or merchant payments on T+0 (instant), with total costs typically below 0.1%, while through SWIFT + correspondent banks it takes 3-7%.

Western Union, a remittance giant with a 175-year history and an annual remittance processing volume exceeding $300 billion, recently announced the integration of stablecoins into its ecosystem. Pantera Capital CEO Devin McGranahan stated in July 2025 that the company has historically taken a "cautious" approach to cryptocurrencies, concerned about their volatility and regulatory issues. However, the introduction of the Genius Act has changed this situation.

"As the rules become clearer, we see a real opportunity to integrate digital assets into our business," McGranahan said during the Q3 2025 earnings call. As a result, Western Union is currently actively testing stablecoin solutions for treasury settlements and customer payments, leveraging blockchain technology to eliminate the cumbersome processes associated with correspondent banks.

Zelle, a P2P payment giant backed by banks (part of the consortium Early Warning Services, which includes JPMorgan Chase, Bank of America, Wells Fargo, and others), has conducted over $1 trillion in fee-free transfers annually within the U.S. using simple mobile numbers or email addresses, and currently has over 2,300 partner institutions and 150 million users. However, cross-border payments have previously been unachievable. On October 24, 2025, Early Warning announced a stablecoin initiative aimed at bringing Zelle to the international market, providing "the same speed and reliability" overseas.

As banks, fintech/neobanks, and payment processors integrate cryptocurrencies in an intuitive, plug-and-play, and compliant manner (minimizing the number of regulatory bodies as much as possible), they can continue to expand their global influence and strengthen relationships.

Conclusion

CaaS is not hype—it represents a transformation of infrastructure, making cryptocurrency invisible to end users. Just as people do not think of AWS when watching Netflix or Salesforce when viewing CRM, consumers and businesses will not think of blockchain when making instant cross-border payments or accessing tokenized assets. The winners of this transformation will not be those companies that add cryptocurrency as an afterthought to traditional systems, but those institutions and enterprises that view blockchain as infrastructure, along with the investors supporting the underlying technological development that underpins it all.

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