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🏛️ What is the GENIUS Act?
The GENIUS Act is a new U.S. bill aimed at formally and federally regulating stablecoins in the United States. This law represents a historic step towards integrating digital currencies into the traditional financial system, such as American banks, in an organized and secure manner.
📋 Key provisions of the law:
• Official licensing for the issuance of stablecoins, whether by banks or specialized financial companies.
• Maintaining cash reserves of 1:1 for every stablecoin issued, meaning every digital dollar must be backed by a real dollar or treasury bond.
• Conducting periodic audits and publishing transparent reports for users.
• Consumer protection through anti-fraud and anti-money laundering laws.
• Prohibiting the issuance of stablecoins that offer financial returns or interest, to reduce risks and prevent confusion with securities.
• Allowing local (state) regulators to oversee small issuers, while maintaining overall supervision by the federal government.
💥 Why is it important?
• It is considered the first comprehensive regulatory framework for stablecoins in America.
• It encourages major companies and banks to enter the crypto market without fear of regulatory gaps.
• It may boost demand for U.S. assets like bonds, due to the linkage of stablecoins to them.
• It represents a step towards making the United States the global capital for crypto regulation.
The GENIUS Act is a new U.S. bill aimed at formally and federally regulating stablecoins in the United States. This law represents a historic step towards integrating digital currencies into the traditional financial system, such as American banks, in an organized and secure manner.
📋 Key provisions of the law:
• Official licensing for the issuance of stablecoins, whether by banks or specialized financial companies.
• Maintaining cash reserves of 1:1 for every stablecoin issued, meaning every digital dollar must be backed by a real dollar or treasury bond.
• Conducting periodic audits and publishing transparent reports for users.
• Consumer protection through anti-fraud and anti-money laundering laws.
• Prohibiting the issuance of stablecoins that offer financial returns or interest, to reduce risks and prevent confusion with securities.
• Allowing local (state) regulators to oversee small issuers, while maintaining overall supervision by the federal government.
💥 Why is it important?
• It is considered the first comprehensive regulatory framework for stablecoins in America.
• It encourages major companies and banks to enter the crypto market without fear of regulatory gaps.
• It may boost demand for U.S. assets like bonds, due to the linkage of stablecoins to them.
• It represents a step towards making the United States the global capital for crypto regulation.
Disclaimer: Includes third-party opinions. No financial advice. May include sponsored content. See T&Cs.
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