The US Congress on Thursday passed a decision that became a "victory" for the crypto industry - the first federal law on stablecoin regulation, paving the way for wider use of this technology in everyday finance, writes UNN with reference to Bloomberg.
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The bill, supported by Republicans and backed by US President Donald Trump, establishes federal or regional oversight of dollar-pegged tokens that can move 24/7 and across platforms. Proponents of the bill argue that it could open access to faster and cheaper payment methods and legitimize a $265 billion market that Citigroup Inc. analysts predict could grow to $3.7 trillion by 2030.
The bill, passed by the House of Representatives by a vote of 308 to 122 and receiving broad bipartisan support after Senate approval, is now on its way to becoming law. Trump personally lobbied for its support among Republican lawmakers.
US Senate approves stablecoin bill: a new step for the crypto industry18.06.25, 09:29 • [views_2768]
The bill marks the political rise of the digital asset industry, which has recovered from the collapse of Sam Bankman-Fried's FTX cryptocurrency exchange less than three years ago, which undermined confidence, and invested hundreds of millions of dollars in electing friendly lawmakers last year.
The stablecoin bill is a central element of the legislative campaign that Trump has dubbed "Crypto Week." Earlier on Thursday, the House also passed a bill on the crypto market structure, which still needs to be considered by the Senate.
Democratic critics warned that the new stablecoin regulatory regime would not provide sufficient consumer protection and could lead to the need for government financial assistance in the event of bankruptcy of digital token issuers.
Meanwhile, the country's most influential bankers are already facing a challenge that the new measure is likely to accelerate - representatives of JPMorgan, Bank of America, and Citigroup this week called the newly minted "digital dollar" a potential threat to the banking industry's control over payments and declared their readiness to respond.
Digital tokens could potentially absorb bank deposits as some consumers transfer money to stablecoin accounts. This could also expand the use of stablecoins in cross-border remittances and payments and open up the possibility for everyone - from banks and payment systems to technology companies - to issue their own stablecoins. In recent weeks, a number of large banks, including JPMorgan, have announced their intention to participate in the issuance of stablecoins.
American crypto companies that issue dollar-denominated stablecoins, such as Circle Internet Group Inc., may have the greatest opportunity to profit. Although Circle's shares rose less than 1% on Thursday, their price jumped 25% this week to $235.08. Shares of Coinbase Global Inc., which has a revenue-sharing agreement with Circle, rose 3.2% to $410.75, a record high.
Bitcoin's price has slightly decreased in the last 24 hours after reaching an all-time high of around $123,000 on July 14, partly due to optimism about the prospects of the stablecoin bill.
Until now, stablecoins have primarily been used for transactions related to the cryptocurrency market, rather than for business payments.
This law "provides the stablecoin industry with the degree of legitimacy they have so craved," said Eswar Prasad, a senior fellow at the Brookings Institution. "And the bonus is that it comes with what I consider relatively light regulation," he noted.
This measure establishes regulatory rules for dollar-backed stablecoins, including a requirement for firms to hold dollar-for-dollar reserves in short-term government bonds or similar products, overseen by state or federal regulators.
Trump and his family are associated with a number of digital asset companies, including World Liberty Financial, a platform with its own branded token and stablecoin.
According to the Bloomberg Billionaires Index, cryptocurrency projects have increased Trump's personal wealth by at least $620 million in a few months.
Some Democrats unsuccessfully tried to add a provision to the legislation that would prohibit elected officials, such as Trump, and members of their families from engaging in stablecoin-related businesses.