The US Senate has approved the significant GENIUS Act, providing a clear framework for stablecoins. The adoption of this bill represents an important step for the crypto industry in the country.
Key Provisions of the GENIUS Act
The GENIUS Act passed with a vote of 68-30, receiving support from both Republicans and a group of Democrats. It introduces strict yet clear requirements for stablecoin issuers, including full reserves, monthly audits, and obtaining federal or state licenses. The act also restricts risky practices like misappropriating funds and creating algorithmic currencies. Importantly, compliant stablecoins will not be considered securities, thus exempting them from SEC regulation.
Impact on Debt and Financial Markets
US Treasury Secretary Scott Bessent commented on the Senate vote and highlighted its long-term implications. He estimates that the stablecoin market could reach $3.7 trillion by 2030, a scenario made more likely with this new legislation. Bessent pointed out that an evolving stablecoin market would drive demand for US Treasuries, which are used to back these digital assets, potentially lowering government borrowing costs.
Prospects for Stablecoins and the Crypto Market
The support for the GENIUS Act aims to bolster the dollar's dominance in the digital world and make the use of the digital dollar easier globally. Proponents believe that the issuance of stablecoins will enhance cross-border money transfer processes, making transactions faster and more accessible. It is also projected that a stronger stablecoin system could contribute to wider crypto adoption.
If the House approves the GENIUS Act, the United States may lead the way in establishing global standards for the crypto industry. This would be a landmark moment for both the digital economy and the country's financial power in the 21st century.
