US President Donald Trump signed a legislation known as the GENIUS Act – Guiding and Establishing National Innovation for US Stablecoins. This law will establish a regulatory framework for stablecoins, potentially paving the way for widespread usage of US-dollar-based cryptocurrencies for payments and money transfers. The Senate and House of Representatives have both approved the bill, with the House passing it by a vote of 308 to 122.
Trump, at the White House bill-signing ceremony, said that the GENIUS Act was named after him and stated that it is beneficial for the dollar and the country. He added that he supported the crypto industry at an early stage not only for its potential but also for political reasons.
The law is a significant victory for the crypto industry and its supporters, who have been pushing for legislation to legitimize cryptocurrencies and increase their usage among banks, retailers, and consumers. The industry contributed over $245 million in the last year’s elections to support pro-crypto candidates like Trump.
Stablecoins, which are designed to maintain a constant value, usually tied to the US dollar, are required to be backed by liquid assets under the GENIUS law. The stablecoin market is currently valued at over $260 billion, and is expected to grow to $2 trillion by 2028 according to Standard Chartered bank. Treasury Secretary Scott Bessent said that this new technology would support the dollar’s status as the global reserve currency and increase access to the dollar economy around the world.
However, critics argue that the law lacks robust anti-money laundering protections and does not prohibit foreign stablecoin issuers. They are also concerned about the growing power of the crypto industry. Scott Greytak of Transparency International US warns that the law could expose the US financial system to criminal exploitation.
Trump had also previously signed an executive order to establish a strategic Bitcoin reserve in March of this year. He holds some ownership in the crypto company World Liberty Financial and launched a meme coin called $TRUMP in January.
Source: https://www.dw.com/en/us-trump-signs-law-paving-way-for-dollar-based-stablecoins/a-73332639?maca=en-rss-en-all-1573-rdf
