#StablecoinRevolution

The "Genius Act" and its potential impact on stablecoins.

The "Guiding and Establishing National Innovation for U.S. Stablecoins Act", or Genius Act, is a proposed U.S. legislation aimed at regulating stablecoins, cryptocurrencies pegged to the value of an asset (usually the dollar). This regulation, if approved, could represent the first comprehensive framework for a market currently valued at around $248 billion, bringing transparency and stability.

The Genius Act outlines clear requirements for issuers, rules on reserves backing stablecoins, and consumer protection measures. It has passed a procedural vote in the Senate but will need to be reconciled with the version of the House Financial Services Committee before being signed by the President.

The approval of the bill could have four key impacts:

Increase in stablecoin issuance: By reducing regulatory risks, the law could encourage new companies to launch stablecoins, increasing competition against the dominant USDT and USDC. Traditional banks like Bank of America and Fidelity are also exploring this possibility.

Increase in tokenized products: Stablecoins are seen as the foundational infrastructure for the tokenization of financial assets such as bonds and stocks. A clear regulatory framework could accelerate the development of these products.

Wider adoption of cryptocurrencies: With greater regulatory clarity, general adoption of digital assets is expected. The market capitalization of stablecoins could reach $2-2.5 trillion by 2030, expanding the use of stablecoins in digital payments, decentralized finance (DeFi), and other blockchain products.

Support for the strength of the dollar: Since 83% of stablecoins are denominated in U.S. dollars, their growth could strengthen the global position of the dollar, acting as a channel that brings liquidity to the U.S. currency and supporting the U.S. sovereign debt market in the short term.

Follow me 💪