The GENIUS Act contains a little-known clause that prevents tech giants and Wall Street giants from dominating the stablecoin market, according to Circle's Chief Strategy Officer, Dante Disparte.
"The GENIUS Act includes what I would call, just for my own legacy, a Libra clause," Disparte stated on the Unchained podcast on Saturday. Any non-bank entity wishing to mint a dollar-linked token must create an independent entity that resembles Circle more than a bank, overcome antitrust hurdles, and face a Treasury Department committee with veto power over the launch.
Banks also do not have a free pass. Lenders issuing a stablecoin must host it in a legally separate subsidiary and keep the coins on a balance sheet that does not involve 'taking risks, leverage, or lending,' Disparte noted.
That structure is even more conservative than the deposit token models that JPMorgan and other entities have proposed. "It creates clear rules that, in my opinion, ultimately benefit primarily U.S. consumers and market participants, and frankly, the dollar itself," he added.