The GENIUS Bill, passed by the US Senate, marks a crucial step in the regulation of stablecoins, leading to significant market changes and reinforcing the dollar's position.
Significance of the GENIUS Bill
On June 17, the US Senate passed the Guidance for the Enhancement of Novel Innovation in the United States (GENIUS) Act with a vote of 68-30. This bill is the first major cryptocurrency legislation approved by the US Senate. It establishes a formal federal framework for stablecoin regulation, requiring issuers to hold reserves at a 1:1 ratio with the US dollar and conduct monthly audits. The bill aims to eliminate regulatory uncertainty in the digital asset space and foster innovation.
Market Response to the New Law
Immediately following the passage of the bill, Bitcoin’s price surged by 8.7%, while trading volume for the stablecoin USDC spiked by 210%. Circle’s stock, the issuer of USDC, rose by 22%. This led to an increased interest from institutional investors such as MicroStrategy, which began acquiring Bitcoin. Notable trends in capital allocation emerged, with several large announcements concerning digital asset purchases.
Global Reactions and Future Prospects
In addition to the US, other countries such as Hong Kong and the European Union are also accelerating legislative regulation of stablecoins. Hong Kong has implemented the Stablecoin Ordinance, while the EU has set limits on the trading volume of non-euro stablecoins. It is expected that new regulations will be actively discussed and adapted worldwide, potentially strengthening the dollar's position on the international stage.
The passage of the GENIUS Act provides a new impetus for stablecoin regulation and confirms the US's commitment to regulatory clarity in cryptocurrency, which could significantly change the competitive landscape in the global financial market.
