The recent passage of the GENIUS Act has generated significant interest in the financial and cryptocurrency sectors. Mastercard has characterized it as a critical step in stablecoin regulation, providing clearer conditions for their use.
What is the GENIUS Act?
The GENIUS Act allows licensed banks and corporations to launch stablecoins pegged to the US dollar, provided they meet stringent reserve requirements, disclosures, and compliance standards.
Mastercard's Response to the Act
Mastercard noted that preparations for the stablecoin regulation had been underway for several years. According to Jesse McWaters, the company’s head of global policy, this law will ensure a sustainable and secure regulatory environment for crypto. Mastercard claims it has already invested in infrastructure and partnerships to support stablecoin growth and is implementing its platforms to manage settlement processes and regulatory compliance.
Criticism and Concerns about the Act
Despite the positive feedback, some analysts, such as Corey Frayer, have expressed concerns that the GENIUS Act may weaken consumer protections. He pointed out the risks associated with using stablecoins instead of traditional government-backed currencies. Critics also raise issues about the potential for an excess of private stablecoins, which could create inconveniences for consumers.
The introduction of the GENIUS Act marks a turning point for stablecoin regulation in the US. While it offers potential advantages, such as simplifying payment systems, expert opinions highlight significant risks related to inadequate oversight and consumer protection.
