- The US stablecoins market represents 96% of the worldwide $247 billion market.
- The GENIUS Act cleared a key hurdle this week after passing a cloture vote within the US Senate.
- Bessent advised senators that stablecoins signify a “new mechanism” to bolster the US greenback’s world place.
The US stablecoin market is heading for a regulatory overhaul that would drive its market measurement to greater than $2 trillion by 2028, based on Treasury Secretary Scott Bessent.
His feedback got here throughout a Senate listening to on Wednesday as lawmakers superior the bipartisan GENIUS Act, geared toward introducing strict guardrails for stablecoin issuers.
Bessent said that regulation tied to US treasuries might considerably increase world utilization of dollar-backed stablecoins and preserve American financial management in an more and more decentralised monetary system.
GENIUS Act features momentum in Senate
The GENIUS Act cleared a key hurdle this week after passing a cloture vote within the US Senate, signalling broad political help for introducing federal oversight of stablecoins.
The laws, seen as pivotal in anchoring stablecoins to the prevailing monetary framework, mandates full backing by US {dollars} or equally liquid belongings.
It additionally imposes annual audits for issuers whose market capitalisation exceeds $50 billion.
The invoice comprises particular clauses to supervise the actions of foreign-issued stablecoins inside the US, underscoring issues about financial sovereignty and potential publicity to systemic dangers.
It comes at a time when the US stablecoin market, valued at roughly $247 billion, accounts for over 96% of the worldwide complete.
President Donald Trump has reportedly endorsed the invoice and is pushing to have it signed into regulation earlier than the summer season recess.
This aligns with the administration’s broader intention to safe the greenback’s position because the dominant reserve foreign money, notably within the face of rising geopolitical competitors and rising options to the buck.
Treasury predicts long-term impression on greenback utilization
Bessent advised senators that stablecoins signify a “new mechanism” to bolster the US greenback’s world place, notably in cross-border commerce and decentralised finance (DeFi).
He mentioned the $2 trillion forecast was “very reasonable”, particularly if regulation drives wider institutional adoption and belief.
His remarks observe ongoing warnings from economists about challenges to the greenback’s dominance, particularly from Chinese language-backed central financial institution digital currencies (CBDCs) and different tokenised options.
Nevertheless, Bessent famous that traditionally, the greenback has retained its reserve standing by adapting to new monetary architectures—a pattern he expects will proceed via the mixing of regulated stablecoins.
He emphasised that “stablecoins backed by US treasuries will serve as the next pillar of dollar strength”, calling on lawmakers to behave rapidly so the US can lead in shaping this rising market.
