The United States’ new stablecoin framework under the GENIUS Act is creating a sharp divide between US and European liquidity, according to a new report from blockchain auditor CertiK. While the law brings long-awaited clarity for US issuers, it also accelerates the global split between American and EU stablecoin markets.
In brief
- •The GENIUS Act creates the first unified US stablecoin framework, tightening reserves and banning yield-bearing tokens.
- •Europe’s MiCA rules diverge by requiring issuers to hold most reserves in EU banks, raising concentration-risk concerns.
- •CertiK warns that the two systems are splitting global stablecoin liquidity into separate US and EU pools.
GENIUS Act: Clear Rules, Fragmented Liquidity
The GENIUS Act, signed by President Donald Trump in July, establishes the first federal rulebook for payment stablecoins in the US. It enforces strict reserve requirements, bans yield-bearing stablecoins and integrates issuers more deeply into the US financial system.
According to CertiK, these rules bring clarity but also reshape liquidity flows. Instead of a unified global stablecoin market, the US is forming its own “distinct liquidity pool,” separate from the EU.
This shift marks the first major structural fragmentation of global stablecoin liquidity. CertiK warns that it could create cross-border frictions, slower settlement between regions and potential arbitrage opportunities between US and EU markets.
EU MiCA Rules Intensify the Divide
While the European Union’s MiCA regime shares some similarities with the GENIUS Act, such as full redemption at par and a ban on yield, it also introduces new constraints.
A key issue is MiCA’s requirement that issuers hold a majority of reserves in EU-based banks. Tether CEO Paolo Ardoino has warned this could create “systemic risks,” as European banks use fractional-reserve practices.
Other industry figures argue that MiCA raises barriers for smaller issuers, making compliance and capital requirements harder to meet. This could accelerate consolidation in the European stablecoin sector.
Neither MiCA nor the GENIUS Act aims to maintain global fungibility. Instead, both focus on regulatory control and financial stability, with the US also pursuing strategic dollar dominance.
The Dollar Strategy Behind US Stablecoin Policy
US officials have been clear that stablecoins are now part of national financial strategy. Treasury Secretary Scott Bessent said earlier this year that the administration will use stablecoins to strengthen US dollar dominance.
This approach positions stablecoins as a tool of statecraft, turning regulatory clarity into geopolitical leverage. The result: a stablecoin system that is increasingly split along regional lines.
Conclusion: A Fragmented Future for Stablecoins
CertiK’s analysis shows a clear trend: global stablecoin markets are moving toward regional segmentation. The GENIUS Act and MiCA may stabilize their respective markets, but together they fracture global liquidity and introduce new friction points.
Whether this split becomes permanent will depend on how quickly cross-border frameworks adapt and whether issuers can navigate two very different regulatory worlds.