Issue 03: Wall Street builds on-chain ops chops. Canton tapped for civic blockchain pilot. Art finance special update.

Welcome to babsNYC.news Issue 03 🗽

Welcome, September, and not a second too soon. Summer was not all bad; a muggy afternoon at the U.S. Open had several upsides, most of them named Honey Deuce. The pace picked up as Wall Street types started getting antsy in the Hamptons. babsNYC skipped Montauk for a quick tryst in Beacon with the Dia Art Museum.

Quick ask: If you enjoy babsNYC, please pass it along to friends who are curious about blockchain, systems, and big-picture thinking about tech.

babsNYC is the only newsletter with cross-sector coverage of blockchain in NYC, including the early signs where blockchain isn’t active (yet) but will be, given current momentum in finance.

Here’s what we saw around the city the last few weeks.

Summary below; scroll down to read

FINANCE:
Galaxy × BNY: Custody meets staking. Alexander Hamilton would be happy. Confused, probably, but happy.
Forget fractionalized Warhols. Art finance extra!
ReFi NYC’s blue-chip meetup glow-up.

BITCOIN:
Pulse detected! 😃

CIVIC BLOCKCHAIN:
Canton tapped by Paul Ryan’s org for multi-state benefits pilot, the biggest news no one is talking about yet.

REGULATION:
New York’s AI-scam warning includes crypto crime.
Clarity Act. NY AG James weighs in.

DATA DIVE:
Where in the world is blockchain? In case you missed it last month - Sarah Jane Hager’s approachable, innovative, data-driven report of blockchain activity in the U.S. and abroad.

TOUCH GRASS, HUMANS:
Cheating on Montauk in Beacon. So worth it.

BABS ANNOUNCEMENTS:
Mexico Tech Week: Who’s in? 🇲🇽 I lived in CDMX for a few years; let’s connect if you are going down.
Want to collab or sponsor? We got you, jefe. Contact us for more details.

Thanks for reading 🫶

Kala Philo
Founder and Senior Editor

On August 4, Galaxy, a digital assets company, and BNY (Bank of New York Mellon), one of the world's largest custody banks, announced a collaboration to support staking through BNY’s Digital Asset Custody platform, subject to regulatory approval. (Staking is earning crypto payments for helping run and secure a proof-of-stake blockchain.)

In a sign of digital assets’ operational maturation, BNY and Galaxy are building a way for eligible institutional clients to access staking rewards within a unified custody, accounting, and reporting environment.

The basic idea is to save institutional clients from the hassle of assembling the pieces themselves, e.g., one provider holds the assets securely, another operates the staking infrastructure, and the institution’s own operations, legal, compliance, finance, and risk teams connect the dots. 🤯

In blockchain art use cases, the first-gen fractionalized artwork promise (selling equal slices of ownership in a single masterpiece) never solved the problem of reliable liquidity. Anecdotally, the demand for fractionalized art was thin. It turns out that owning just a piece of the action isn’t all that satisfying.

I’ve been thinking about this for months, and a conversation in August led me down the rabbit hole regarding blockchain’s implications for art finance.

Sotheby’s global HQ is in NYC, and Christie's maintains a major presence here as well*. In February 2026, Sotheby’s reported 2025 revenue of $1.4 billion, a 21% increase versus 2024.

While best known for their “front-of-house” auction business, both firms offer loan services, using art as collateral.

Sotheby's Financial Services (SFS) goes beyond making loans. Its ArtFi Master Trust bundles art-backed loans into securities that institutional investors can buy. If those securities were eventually tokenized, it could make settlement, reporting, and collateral use more efficient.

Christie's Art Finance emphasizes bespoke lending, private-client services, and innovation via Christie’s Ventures Innovation Lab. The yearly Art+Tech Summit has tracked blockchain and other art tech developments since 2018.

One trend affecting the art world is the expansion of the UHNW and HNW income bracket. New wealth creation and generational wealth transfer are accelerating; competition for new clients and the best collectors is heating up. 

From the client experience POV, managing, let alone optimizing, an art collection as a financial investment is still a fragmented process. At the very least, stablecoins could shorten the time it takes borrowers to receive funds, addressing a real pain point in international settlement.

My read: Perhaps the next evolution of art finance is an integrated service for provenance, valuation, and loan details onchain. Sotheby's and Christie's already sit on deep databases of valuation history and ownership records. Blockchain-anchored provenance could extend that: a persistent record that updates with each valuation, loan, or sale, providing backup documentation for future collateralization. Provenance is already a significant value driver for valuation. Can you imagine the impact of onchain provenance documentation on artworks’ value after 50, 100 years and beyond?

In adjacent activity, note that luxury brands are already putting provenance onchain. The Aura consortium, founded by LVMH, Prada, Cartier, and OTB, uses blockchain-based digital passports to track authenticity and product histories, while preparing brands for the EU’s emerging transparency and lifecycle-data rules. 

Given the existing friction in the art client journey, competition for those clients, and loan requirements for verified valuation and provenance, integrating an art asset’s “journey” onchain seems like a natural step. What do you think?

Deep dive: 9th Deloitte Private and ArtTactic Art & Finance Report

*For simplicity’s sake, Phillips auction and fiduciary services were not included in this summary.

I’m convinced that cloned agents are now mainstream because Jorge Cortes Restrepo must have at least three. He’s a leading web3 advocate who is everywhere, as long as it’s interesting.

Recent case in point: The ReFi New York launch event, co-hosted by David Chen (Princeton Venture Studio) and the Harvard Business School Alumni Angels of Greater New York. Learn more

Mother Nature flexed with a rush-hour deluge in Midtown as attendees braved a monsoon to get to the event (including a tornado touching down on Long Island). The Regenerative Finance movement is a space to watch because it provides the fintech innovation to support community-centered values.

Bitcoin showed signs of life in August, moving from around $65,000 early in the month to near $80,000 late in the month. Go Maxies 🤩 !

During the six-session spot-Bitcoin ETF inflow streak from August 17–24, U.S. funds took in $2.25 billion, with BlackRock’s IBIT absorbing $1.54 billion, or 68.3% of the total, underscoring how dominant BlackRock remains in the category. Read more

New York State’s Division of Consumer Protection warned New Yorkers in late August about a surge in AI-enabled investment scams. The advisory’s list of scams predictably included fake cryptocurrency projects among a laundry list of shady practices. Read more 

 New York Attorney General Letitia James urged Congress to revise the CLARITY Act before passing it, warning that the federal crypto-market-structure bill could override state investor-protection and antifraud laws.

Her office argues that New York must retain the ability to investigate crypto scams and hold platforms accountable, even if Washington creates a national framework.

Confused about the Clarity Act? Try this primer from Triple A. (Not a sponsored placement.)

On August 21, NYC-based Digital Asset and the American Idea Foundation announced RISE, an initiative to combine and distribute state-administered benefits, using the Canton permissioned-blockchain network. 

The proposed initial rollout, planned for three states (TBD) in Q1 2027, focuses on improving efficiency in public assistance operations (rules, permissions, distribution, recordkeeping, coordination, and oversight) and modernizing benefit retention adjustments as income levels increase. Learn more

This pilot matters a lot because it could establish the template for government assistance moving on-chain. Learn more

Context: Digital Asset originally developed Canton, a private, or “permissioned” blockchain for finance, and continues to build technology and services around it. For a brief background on Canton in relation to Wall Street, see the Finance Section of babsNYC Issue 01.

In the spirit of a bi-coastal blockchain, Patricia Perez and I met in a Zoom breakout room for SheFi Inner Circle Founding Members. We had a great conversation, and I was happy to see her post about it later. Thank you, Patricia, for raising awareness about civic blockchain in Culver City (Los Angeles). ⚡ ☄️

🏆 A special feature by guest contributor Sarah Jane Hager, Data Analyst and Quant Strategist

In case you missed it last month, check out Sarah’s approachable, innovative, data-driven overview of blockchain activity in the U.S. and abroad. Read the report

IRL things to do in and around the most amazing city on the planet. (Not sponsored unless otherwise noted.)

Fun fact in case you slept in history class or didn’t catch “Hamilton” on Broadway - the original Bank of New York was founded in 1784, with Alexander Hamilton among its founders. Speaking of forgetting, Episode 1 of PBS’s interesting but quite long-winded New York: A Documentary Film covers the genesis of Wall Street and reminds us that pre-social-media attention spans were a marvel.

Like many writers in a situationship with New York City, I flee upstate to Beacon when I’m at the “I need some space” stage in our relationship. My friend and I were two of three people at Estilo y Vino, a lovely piano wine bar on a recent Thursday evening.

Another main draw is a visit to Dia Beacon’s old strongbox of a building that hosts improbably generous, beautiful spaces for people and art. Agnes Martin’s luminous Painting is not making paintings installation is an exquisite fit. She was active between NYC and New Mexico for most of her life. 

If you like works by mid-20th-century NYC artists, Dia Beacon has an astonishing variety of A-lister pieces - Judd, Serra, Lawler, Ryman, Flavin, to name a few.

Mexico City has been the International It Girl for the last few years. La Reina has been serving her unique magic in food, art, design, and now TECH.

Plus, Mexico Tech Week closing on the Día de los Muertos holiday?! That’s some extra spice.

Are you going? babsNYC Founder Kala Philo lived in Mexico City (ella habla español) for a few years before moving to NYC. Let’s connect!

Are you hosting an event the NYC blockchain space should know about?
We are open to collaborating or co-hosting on aligned events.

Contact us for more details.

Interested in guest posting? Reach out here.

If you enjoy babsNYC, please pass it along to friends who are curious about money, systems, blockchain, and big-picture thinking about practical upgrades to civilization tech.