Euphoria took over the market in the early hours of Friday (18), the result of optimism with the advancement of regulation in the U.S.
Bitcoin green chart
The global cryptocurrency market has surpassed the $4 trillion mark for the first time in history, driven by the Genius Act, a new law that establishes a regulatory framework for digital assets in the United States.
The bill was signed by President Donald Trump in a ceremony filled with entrepreneurs from the crypto sector.
While the cryptocurrency market is breaking records, major stock indices like the S&P 500 have shown little fluctuation, pressured by new uncertainties in the trade landscape between Washington and the European Union.
Cryptocurrency market capitalization $4T (Bloomberg)
Euphoria took over the market in the early hours of Friday (18), the result of optimism with the advancement of regulation in the U.S.
Bitcoin (BTC) briefly surpassed $120,000, according to CoinMarketCap data, before retreating at the end of the day.
The rise also affected altcoins, which recorded strong gains and brought the total cryptocurrency capitalization to $4.1 trillion. However, part of those gains was given back at the end of the day.
Cryptocurrency rise year (Tradingview)
The rise came in the wake of the approval, the day before, of three bills aimed at the cryptocurrency sector in the House of Representatives.
Two are now heading to the Senate, while the third — the Genius Act, which deals with the regulation of asset-backed stablecoins like the dollar — had already passed through the Senate earlier and is now heading for presidential sanction.
On Friday afternoon (18), Trump signed the Genius Act at a press conference held at the White House, alongside executives from industry giants such as Coinbase and Robinhood.
"We worked hard. It's a very important law, the Genius Act. They named it after me," Trump joked in front of the cameras, referring to the acronym of the project: Governmental Engagement for the National Integration of Unified Stablecoins (GENIUS).
Crypto stocks soar with regulatory optimism
The signing of the Genius Act had immediate effects on the stock markets. Coinbase (COIN), the leading crypto exchange in the U.S., surged nearly 6% at the opening, reaching a new all-time high of $444 per share, before closing the day with a 2.2% increase.
Coinbase stocks rise
Meanwhile, Robinhood (HOOD), which allows cryptocurrency trading through its app, also recorded a new record, hitting nearly $113 and closing the day with a 4% increase.
Robbin hood stocks
Executives from both companies, as well as from other industry leaders like Kraken and Circle, were present at the signing ceremony of the project.
Sources close to the situation say that CEOs were consulted during the drafting of the Genius Act, which imposes liquidity, audit, and transparency requirements for stablecoin issuers in the U.S.
Traditional market stagnated with focus on trade tensions
Stocks around the world Finviz
While the crypto sector celebrated, traditional markets showed caution. The S&P 500 closed the session nearly stable, with a slight weekly increase of 0.7%. The Nasdaq rose 0.4% on the day, and the Dow Jones fell 0.3%.
Part of the investors' hesitation was attributed to a new chapter in trade negotiations between the United States and the European Union.
According to the Financial Times, Trump is reportedly pressuring Brussels for a minimum tariff of 15% to 20% on European products, which could rekindle protectionist tensions similar to those seen during his first term.
Kush Desai, White House spokesperson, declined to comment on the content of the negotiations, but analysts point out that Trump's aggressive stance could hinder multilateral agreements and negatively impact exporting sectors, especially in the automotive and agricultural industries.
Cryptocurrencies enter the political radar
The rapid appreciation of the cryptocurrency market after the legislative advance reinforces the thesis that the sector is increasingly linked to the American political landscape.
For analysts, the approval of the Genius Act is a game changer for digital assets in the U.S.
"This is the first relevant legal milestone in the U.S. that directly addresses the fundamentals of stablecoins. This puts the U.S. ahead of other jurisdictions and attracts institutional capital that has previously been on the sidelines," says Alicia Grant, an analyst at Fidelity Digital.
What is the Genius Act?
Trump Signs Genius Act with Industry Leaders
The Genius Act establishes clear rules for the issuance and operation of stablecoins in the United States, requiring issuers to maintain full backing in auditable reserves, limit leverage, and register with the Department of the Treasury.
The proposal also creates a regulatory sandbox for innovation in fintechs and establishes a supervisory board with participation from the Fed and the SEC.
As a result, greater legal security is expected for investors, confidence for issuers, and encouragement of competition, especially against major issuers like Tether and Circle.
Outlook
Despite the pullback at the end of the day, breaking the $4 trillion barrier marks a new milestone for the cryptocurrency sector, which now establishes itself as a central component of the global financial system.
The expectation that the Senate will approve the other two bills in the coming weeks keeps optimism high.
On the other hand, Trump's belligerent stance towards the European Union could represent a risk to investors' risk appetite, generating volatility in the short term.
For the crypto market, however, July 18 goes down in history as the moment when legal recognition met the strength of the markets — and the digital future received another push towards mass adoption.
