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GENIUS Act Approved to Regulate Stablecoins

The newly passed GENIUS Act restricts major players from issuing stablecoins without oversight.

July 20, 2025 at 07:37 AM

GENIUS Act Blocks Big Tech From Dominating Stablecoins: Circle Exec

Circle's Dante Disparte discusses the implications of the GENIUS Act on the stablecoin landscape.

GENIUS Act Limits Big Tech's Role in Stablecoin Market

The GENIUS Act, recently passed with bipartisan support, includes a provision that limits major technology firms and large banks from dominating the stablecoin sector. Circle’s Chief Strategy Officer, Dante Disparte, emphasized that non-banking entities must establish separate companies to create dollar-pegged tokens. They also need to meet strict regulatory measures. Traditional banks wishing to issue stablecoins must ensure that these coins are housed in a distinct subsidiary without engaging in risk-taking operations. Disparte believes these changes will benefit U.S. consumers and the dollar’s global standing.

Key Takeaways

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The GENIUS Act restricts big tech and banks from issuing stablecoins without oversight.

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A subsidiary structure for banks will be required to manage stablecoins effectively.

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The bill was passed with bipartisan support, highlighting its significance.

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Yield-bearing stablecoins are banned, which could deter consumer adoption.

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Decentralized finance may gain traction as a result of the act's restrictions.

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Institutional demand for DeFi could surge following the changes in regulation.

"The GENIUS Act creates clear rules that benefit US consumers."

Dante Disparte highlights the intended positive impact of the act on consumers.

"Crypto is finally getting what it wanted: legitimization and clear regulation."

Disparte underscores the act's significance for the legitimacy of cryptocurrency.

The passage of the GENIUS Act marks a significant shift in the regulatory approach to stablecoins. As technology giants are kept in check, traditional banks see tighter rules that could reshape how they interact with digital currencies. The act's ban on yield-bearing stablecoins may hamper their appeal but could redirect interest towards decentralized finance platforms. This shift could see institutional investors increasingly turning to decentralized finance as their key avenue for generating returns, creating a division in the market.