US stablecoin issuers Circle and Coinbase can now apply for banking licenses following the US GENIUS Act of 2025, influencing global regulatory frameworks.
This regulatory shift promises to double the stablecoin market cap by 2025, boosting adoption and institutional engagement in the cryptocurrency sector.
Stablecoin Issuers Eligible for US Banking Licenses
US stablecoin issuers like Circle and Coinbase can now apply for banking licenses. This follows the US Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act of 2025.
Janet Yellen, U.S. Treasury Secretary, stated, "Stablecoins require robust oversight and transparent reserves. The GENIUS Act marks a critical step in integrating digital dollars into our regulated financial system."
The act sets reserve and stability requirements, expanding the issuers' roles in the US banking system. Regulatory bodies such as the SEC and CFTC have been instrumental in shaping this framework.
Institutional Surge Expected from Regulatory Clarity
The act is anticipated to significantly impact stablecoin issuers by integrating them into the financial system. This may lead to a surge in institutional interest and usage of stablecoins.
Bitcoin (BTC) and Ethereum (ETH) prices are likely to benefit, driven by increased institutional investment and stablecoin-related activities. Historically, regulatory clarity has encouraged growth in cryptovalue and adoption.
Tether, Libra Set Precedents for Current Regulations
Tether's early launch and Facebook’s Libra proposal reflect how digital currencies encouraged regulatory frameworks like MiCA. These historical precedents highlight the evolving relationship between crypto and regulators.
Experts predict deeper integration of digital currencies within traditional finance, seeing parallels with past increases in liquidity and market participation when regulations become clearer.