Stablecoins to Become Cash Layer of Internet Once GENIUS Act Is Law: Bernstein
The Senate’s GENIUS Act, a key piece of U.S. stablecoin regulation, is to be voted on this week and should be passed into law in the next few months, Wall Street broker Bernstein said in a research report Monday.
Stablecoins are cryptocurrencies whose value is tied to another asset, such as the U.S. dollar or gold. They play a major role in cryptocurrency markets, providing among other things a payment infrastructure, and are also used to transfer money internationally.
Once the act is passed, Bernstein said it expects “stablecoins to evolve from the money rail of crypto to the money rail of the internet.”
The act, whose full name is Guiding and Establishing National Innovation for U.S. Stablecoins Act, is designed to bring stablecoin innovation back to the country, the report noted, adding that it gives a head start to U.S. regulated issuers.
It mandates federal regulation for stablecoins with a market cap of over $10 billion with the potential for state regulation if it aligns with federal rules.
The bill treats stablecoins as digital cash, and its intent is to drive wider mainstream adoption for payments beyond just using these cryptocurrencies as a settlement currency for digital assets, the report said.
The GENIUS Act “makes it prohibitive for non-financial public companies to become stablecoin issuers,” Bernstein said, noting recent reports that said Amazon and Walmart were exploring using these cryptocurrencies.
If e-commerce and tech platforms want to adopt these cryptos they will likely have to work with regulated U.S. issuers rather than issuing their own stablecoins, the report added.
