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Last February, speaking at the Future Investment Initiative in Miami, U.S. President Donald Trump had reiterated his desire to make America "the cryptocurrency capital of the world," stablecoins included. An economic revolution to be built brick by brick.
In the great U.S. yard on crypto, the first stone just laid has anything but symbolic value being represented by the Guiding and establishing national innovation for U.S. stablecoins(Genius Act). This is the package of regulations that, with the okay of the House of Representatives as well (expected in a few weeks), is intended to graft into the U.S. legal system the first attempt at comprehensive federal regulation for stablecoins, or cryptocurrencies whose value is pegged to another asset, such as a flat currency or gold.
Not least because, it has not escaped observers' notice, the very stablecoins are becoming 'greedy' buyers of T-bonds, the long-term debt securities issued by the U.S. government with maturities longer than 10 years. But let's go in order.
The Genius Act represents the second Republican legislative foray into stablecoin: Already last year the House of Representatives had passed a similar bill but the Senate, then with a Democratic majority, had rejected it. It was enough to wait. After all, as pointed out by Reuters, the cryptocurrency industry has spent more than $119 million supporting candidates in the U.S. Congress who are sympathetic to their demands. Money well spent judging by the Senate's change of approach to the matter.
The House of Representatives, for its part, should not set any traps since it has long pushed for regulation of stablecoins. Important differences remain between the two texts: the Senate's, for example, gives the Treasury all supervisory powers over stablecoins, while the House divides them among multiple authorities, including the Federal Reserve, but Republicans are confident that the synthesis will soon be on Trump's desk for final signature. And, in all likelihood, the centralizing version of the Upper House will win, given the relationship between the tycoon and the Fed.
One of the aspects to be taken into account in the new regulatory framework, according to Paolo Gatelli, senior research manager at the Research Center of theCattolica Università ofdel Sacro Cuore Milan - Cetif heard by Wired just to understand what scenarios now open is the fact that, in order to be protected by the new set of rules "stablecoin issuers must have their headquarters in the United States". An aspect that, at least virtually, could also trigger"a migration of legal headquarters" by fintechs from other countries.
Regardless, the U.S. legislature's desire to "create an appropriate environment for an entity"that is rapidly expanding "that will be regulated and controlled in a nonrestrictive manner, " Gatelli goes on to explain. A benign environment that could "incentivize large banks to issue stablecoins."
Banks of the rest"are not innovation-averse per se," as is also often repeated,"but they are risk-averse, partly because of regulatory uncertainty that induces institutions to wait-and-see."
The Genius Act has the opposite purpose: it "opens the door wide for investment in stablecoins." And it aims precisely to make the United States that 'crypto capital of the world' repeatedly evoked by Trump if one considers that "the reference legislation valid in Europe, Micar, turns out to be far more restrictive than its U.S. counterpart, which has just obtained the okay of the Senate," the expert goes on to explain. These very differences could push stablecoin issuers to relocate to the United States, affecting the geography of the global market in the coming years.
All of this dovetails perfectly with another economic phenomenon that, although karst, has certainly not escaped the White House's radar: "stablecoins have accumulated significant amounts of T-bonds, " or U.S. debt securities,"to the tuneof about $250 billion. This is a far cry from the 2.4 trillion held by funds but still makes the new player in absolute terms the second largest holder of U.S. debt," Gatelli points out.
A breath of fresh air for the federal treasury since"the tariff war" unleashed by Donald Trump himself"has caused widespread distrust of the dollar," the quintessential safe haven asset.
"The classical market at present, given the uncertainty due to ever-changing daily proclamations, is lukewarm toward T-bonds," notes the expert. Through the regulatory pass, however, "America finds and facilitates a new source of funding"."At the same time," notes the Cetif researcher, " it aims to regulate its subject even if not in a way favorable to the economic actors in the field.
Trump's recent and increasing moves in the crypto sector should also be read in this light."Since the president of the United States personally invests in the sector and is linked to some virtual currencies, the aim is to quickly fade that social stigma that has always burdened the sector." A signal addressed to everyone: crypto is solid and safe because the White House tenant says so, 4.0 revision of the old all-U.S. slogan repeated at every election campaign 'would you buy a used car from this candidate?'
"The design of the U.S. legislature," Gatelli summarizes, " is evidently to fuel stablecoin's recent interest in U.S. T-bonds, in part because the Genius Act itself ties the peg to the dollar and government bonds, at a time in history when anchor investors appear more skeptical of the U.S. currency. At the same time, as part of the regulatory framework that offers protections only to stablecoins tied by head office to the 50 U.S. states, there is an attempt to bring some of the debt back within U.S. borders." An ambitious project to reduce U.S. exposure to geopolitical vagaries that increasingly have Washington as their epicenter.
"At the very least, with the contribution of stablecoins," he concludes, "there is an attempt to mitigate any fluctuations in the value of T-bonds at a time when there is less of a rush to buy. But regardless of such, hypothetical scenarios, what is certain is that thanks to the U.S. regulatory intervention, "stablecoins go from being simple payment instruments to true strategic assets." With consequences that will reverberate in other markets as well.