The recent US passage of the Genius Act has been marked by a significant point of stablecoins, which sets a regulation that has previously shaped digital finances worldwide.
Fabian Dori, Chief Investment Officer at Sygnum Bank, joined the latest phase of Cointelegraph’s byte-sized insight podcast, Detail how the law can influence the adoption of stablecoinInstitutional engagement and international regulatory alignment.
Innovation and stability
The Genius Act, which introduces a I -Clear the federal regulatory framework For FIAT-supported FIATs, the entire transparency is demanded from those who give, including one-to-a-backing asset, mandatory federal licensing and independent reserve audits.
According to Dori, these provisions are important for driving responsible change and financial stability.
“I really think that the impact of the Genius Act will be significant, both in short and in the long run,” Dori said.
“By ordering that Stablecoin issues will obtain a federal license, restore their Stablecoins 1-to-1 with high quality liquid assets and reveal the reserve composition … Institutional investors may have legal confidence to use regulated stablecoins.”
However, a controversial aspect of the law, the prohibition of stablecoins carrying the yield, may be a major reshape of how stablecoins incorporates within decentralized finances (DEFI).
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Dori points out that transfer can create a clearer market difference between stablecoins dedicated to paying and products generated by tokenized currency market products.
“It is true that it is not possible to earn directly from handling fiats supported by FIAT,” he said.
“This will create a clear separation between those who do not produce stablecoins and tokenized funds in the currency market.”
Europe compared to us
Another major topic discussed is the division between regulations in Europe and the US.
Europe, who has been careful about its regulation, especially in the digital euro initiative, can now face pressure to accelerate the change due to the US stance through the Genius Act.
“It seems like the US is more focused on a framework that gives and drives a change, while Europe is primarily focused on risk management,” Dori said.
“The Genius Act really attracts both new ones, but also new cases of use in the US, which then can lead to Europe that requires or is forced to open.”
Listen to the entire stage of the byte-sized perspective for complete interview with cointelegraph podcasts Page, Apple podcast o Spotify. And don’t forget to check the entire cointelegraph lineup of other shows!
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