#StablecoinLaw

The US has recently passed a landmark stablecoin law, known as the GENIUS Act, which establishes a federal regulatory framework for stablecoins. This law requires stablecoins to be backed one-to-one by dollars or other low-risk assets and mandates issuers to disclose the composition of their reserves monthly. The GENIUS Act aims to protect users, promote responsible innovation, and clarify regulation in the stablecoin market.¹ ²

*Key Provisions of the GENIUS Act:*

- *Backing Requirements*: Stablecoins must be backed by liquid assets, such as US dollars and short-term Treasury bills.

- *Disclosure Requirements*: Issuers must disclose the composition of their reserves monthly.

- *Regulatory Oversight*: The law establishes federal oversight for stablecoins, providing clarity on regulation and legitimacy.

*Impact on the Market:*

- *Growth Potential*: The stablecoin market is expected to grow to over $2 trillion by 2028, driven by increasing adoption and favorable regulations.

- *Increased Credibility*: The law is likely to enhance stablecoins' credibility, making banks, retailers, and consumers more willing to use them for transactions.³ ⁴

*Global Regulatory Developments:*

- *Hong Kong*: Hong Kong's stablecoin law is set to take effect on August 1, marking a significant shift in regulatory oversight.

- *South Korea*: South Korea has proposed a stablecoin licensing law, requiring issuers to obtain regulatory permission and meet certain capital requirements.⁵ ⁶