Bitcoin Reaches New All-Time High Amid Stablecoin Legislation Advancement and DeFi Patent Lawsuit

Executive Summary

Bitcoin surged past $112,000, while the U.S. Senate advanced stablecoin legislation and Bancor filed a patent infringement lawsuit against Uniswap, indicating increased market maturity and institutional integration.

The Event in Detail

Bitcoin's Price Discovery and Institutional Inflows

Bitcoin (BTC) reached a new all-time high of $112,000, subsequently surging past $116,000 to reach as high as $117,150 on October 1, 2025, and an all-time high near $124,596 in August 2025. This upward trajectory is supported by substantial institutional demand. U.S. spot Bitcoin ETFs recorded $429.9 million in net inflows on September 30, 2025, contributing to $3.53 billion in total monthly inflows. BlackRock's iShares Bitcoin Trust (IBIT) alone attracted $199.4 million on that date, and its total inflows since January 2024 surpassed $15 billion, with overall spot Bitcoin ETF inflows exceeding $28 billion in 2025. This robust institutional capital infusion underpins Bitcoin's ability to maintain a price floor above $100,000 and reinforces its narrative as a "digital gold" and a hedge against macroeconomic instability.

Stablecoin Regulatory Framework: The GENIUS Act

The U.S. Senate advanced the Guiding and Establishing National Innovation for US Stablecoins Act (GENIUS Act), which passed with bipartisan support in the Senate (68-30) and the House (308-122) before being signed into law on July 18, 2025. This legislation establishes a comprehensive federal regulatory framework for payment stablecoins. Under the GENIUS Act, a payment stablecoin is explicitly classified as neither a "security" nor a "commodity," placing its federal regulation under banking authorities rather than the SEC or CFTC. The Act mandates that permitted payment stablecoin issuers maintain reserves backing outstanding stablecoins on at least a one-to-one basis, consisting of specified assets such as U.S. dollars, federal reserve notes, funds in insured depository institutions, short-term Treasuries, and money market funds. It prohibits any entity other than a permitted issuer from issuing stablecoins in the U.S. and forbids deceptive marketing, such as implying U.S. government backing or federal deposit insurance.

Bancor's Patent Infringement Lawsuit Against Uniswap

Bancor, through Bprotocol Foundation and LocalCoin Ltd., has filed a patent infringement lawsuit against Uniswap Labs and Uniswap Foundation in the U.S. District Court for the Southern District of New York. The lawsuit alleges that Uniswap has been infringing on Bancor's patents related to the Constant Product Automated Market Maker (CPAMM) model, a foundational technology for decentralized exchanges. Bancor claims to have invented this smart contract structure in 2016, filing a provisional patent application on January 8, 2017, and launching the first fully decentralized exchange powered by AMMs in June 2017. The plaintiffs assert that Uniswap has continuously used this patented technology without authorization since launching its v1 protocol in November 2018, and continues to do so with its v4 protocol. The lawsuit seeks damages for this alleged unauthorized use and raises critical questions about intellectual property rights within the traditionally open-source Decentralized Finance (DeFi) ecosystem.

Market Implications

Bitcoin's continued price discovery and strong institutional inflows, exemplified by the performance of spot Bitcoin ETFs, suggest sustained investor confidence and increasing integration into traditional financial portfolios. This trend positions BTC as a significant asset for wealth preservation amidst global economic shifts, mirroring the "digital gold" narrative. The advancement of the GENIUS Act provides regulatory clarity for stablecoins, which is expected to foster greater mainstream adoption and reinforce the U.S. dollar's digital footprint. This legislative development could facilitate further integration of digital assets into established financial systems, as major banks like JPMorgan and Morgan Stanley are already exploring or rolling out crypto trading services. The Bancor vs. Uniswap lawsuit, however, introduces a critical legal precedent for intellectual property rights in DeFi. A ruling in favor of Bancor could redefine how innovation is protected and shared, potentially impacting the open-source ethos that has largely characterized the development of Web3 protocols. This legal challenge highlights the growing pains of a maturing industry as it navigates the intersection of novel technology and existing legal frameworks.

Broader Context

These concurrent developments underscore a significant evolutionary phase for the cryptocurrency market. The combination of sustained institutional capital inflows, progressing regulatory frameworks, and critical legal challenges indicates a maturing ecosystem that is increasingly integrated with global finance. The focus on regulatory clarity for stablecoins and the assertion of intellectual property rights within DeFi reflect efforts to establish more defined structures for growth and innovation. This period is characterized by the expansion of the Web3 ecosystem and broader adoption, as digital assets move from niche investments to an increasingly mainstream and regulated financial sector.