On August 19, 2025, the latest Merkle Meets session brought together Robert Whitaker, Director of Law Enforcement Affairs at Merkle Science, and Caroline Hill, Senior Director for Global Policy and Regulatory Strategy at Circle. Their discussion covered the evolution of government views on digital assets, the rise of stablecoins, the critical role of compliance and public–private partnerships, the shifting regulatory landscape, and what lies ahead for tokenization and programmable money. (You can watch the full discussion here.)
Here are the five biggest takeaways from their conversation. You can watch the full discussion here.
Hill opened the conversation by reflecting on her career path, from her work on anti–money laundering (AML) and countering the financing of terrorism (CFT) at the U.S. Treasury Department to her current role at Circle. She emphasized how much the government’s stance on crypto has shifted over the years.
In the early days, policymakers saw digital assets as little more than a vehicle for crime. That view began to soften as the technology matured, with governments beginning to acknowledge risks but also recognizing the potential benefits of innovation. Today, she argued, the conversation has become even more nuanced: rather than treating crypto as a threat to financial stability, regulators are increasingly interested in how it can be used to mitigate risks, improve transparency, and support new forms of financial access.
Whitaker added his own perspective, recalling how, during the days of Silk Road, blockchain tracing was treated as a kind of rocket science. Investigators often assumed crypto was untraceable, when in fact the public nature of blockchains made them far more transparent than traditional financial systems. Over time, the tools and techniques have improved dramatically, turning blockchain into an asset rather than an obstacle for law enforcement.
2. Stablecoins Are Reshaping Payments and Finance
Much of the discussion focused on stablecoins, which Hill described as deceptively simple but deeply transformative. A stablecoin like USDC functions on a one-to-one model: one dollar is deposited, and one token is issued. While the mechanics are straightforward, the implications for global payments are profound.
Stablecoins first gained traction within crypto markets and decentralized finance (DeFi), where they served as a bridge between fiat and digital assets. Over time, their use cases expanded, especially in the context of global payments. Hill emphasized their advantages: 24/7 settlement, near-instant transfers, and negligible transaction costs compared to traditional payment rails. This makes them especially valuable in cross-border contexts, where existing systems are slow and expensive.
Stablecoins also offer a pathway to financial inclusion, especially for underbanked populations who lack access to efficient banking services. Hill pointed to Circle’s growing partnerships with mainstream financial institutions, such as Visa and Mastercard, as evidence that stablecoins are increasingly being woven into the global financial fabric.
Whitaker agreed on the convenience but also highlighted some of the risks: sending to the wrong wallet address or chain, or falling prey to scams. However, he noted that ongoing improvements in technology and user experience are steadily addressing these barriers, making stablecoins more accessible to everyday users.
3. Compliance and Public–Private Partnerships Are Essential
Both Hill and Whitaker stressed that criminals will always try to exploit vulnerabilities, whether in banking, social media, or crypto. What distinguishes blockchain, however, is that illicit finance is far easier to detect and trace than in traditional systems.
Circle has built its business on compliance-first principles, maintaining robust anti–money laundering controls from day one. Hill explained that Circle has the capability to freeze or even burn assets when necessary—tools that act as strong deterrents against illicit use.
Still, technology alone is not enough. Both speakers emphasized the importance of public–private partnerships. Just as in traditional finance, effective enforcement requires collaboration between government and industry. Blockchain data can reveal what happens on-chain, but tying that activity to real-world actors requires off-chain intelligence that often comes from cooperation with regulators, law enforcement, and private companies.
Whitaker underscored this point by noting the value of joint investigations and shared intelligence. In his view, crypto remains a relatively small world, and the community of investigators, compliance teams, and private sector partners is tight-knit. This cooperation, he argued, is one of the most effective tools in making illicit finance harder to conceal.
4. Regulation Is Catching Up Globally
Another major theme was the accelerating pace of regulation, especially around stablecoins. Hill pointed to the U.S. Genius Act as a landmark development. The bill would establish a federal framework for stablecoin issuers, eliminating the patchwork of state-by-state licensing and placing oversight under federal regulators such as the OCC and the Federal Reserve. It would also set clear requirements for reserve management and compliance.
Hill contrasted this with other legislative efforts such as the Clarity Act and RFIA (Responsible Financial Innovation Act), which take on the broader digital asset ecosystem by addressing issues like token classification and custody. While those efforts remain under debate, the Genius Act has already made significant progress in shaping the U.S. approach.
Globally, Hill highlighted MiCA in the EU and new regulatory frameworks emerging in APAC as examples of growing harmonization. Over the next few years, she expects to see more alignment across jurisdictions, giving stablecoin issuers a clearer path to compliance.
Whitaker observed that these changes will not only reshape the digital asset industry but could also disrupt the traditional banking and custody sectors. As stablecoins and tokenized assets gain traction, questions about how custody rules will evolve remain pressing, underscoring just how transformative these regulatory shifts may be.
5. The Future of Digital Assets Lies in Tokenization and Programmable Money
Looking forward, both speakers agreed that the next phase of growth will center on tokenization and programmable money. Hill predicted the rise of more localized stablecoins, which will interact with USDC and similar tokens to enable seamless cross-border payments. This interoperability will help knit together a fragmented global financial system.
She also pointed to the growing momentum behind real-world asset tokenization (RWA). By putting assets like real estate, bonds, or commodities on-chain, tokenization promises to make settlement faster, more secure, and more efficient. Programmable money, meanwhile, enables entirely new types of financial interactions, from conditional payments to automated compliance.
Whitaker echoed her enthusiasm, noting that tokenization and digital identity could soon enable high-value transactions - such as purchasing a home - to be settled securely in just days, a process that currently takes weeks or months.
Final Thoughts
The fireside chat between Whitaker and Hill highlighted both the challenges and opportunities facing the digital asset industry. Governments are rethinking their stance on crypto, stablecoins are moving into the financial mainstream, compliance and partnerships are proving essential, regulation is rapidly catching up, and tokenization promises to transform the future of finance.
For law enforcement, regulators, and industry alike, the message was clear: the myths of crypto anonymity are outdated. Blockchain offers new levels of transparency, and with the right partnerships, innovation can not only coexist with compliance but actively enhance it.
Click here to watch the full discussion between Whitaker and Hill.
