What do these latest developments in the global value transfer space mean?
Written by: Blockchain Knight
Welcome to "Slate Sundays," a new weekly column launched by CryptoSlate, focusing on in-depth interviews, expert analysis, and thought-provoking commentary that goes beyond the headlines to explore the ideas and voices shaping the future of cryptocurrency.
If 2024 is the "Year of the Dragon," then 2025 will be the "Year of Stablecoins." In particular, dollar-backed digital assets have become the focal point, even gaining recognition at the highest levels.
In March of this year, a DeFi platform controlled by the Trump family launched the World Liberty stablecoin, USD1. In May, Vice President JD Vance spoke at the Bitcoin conference, clarifying the government's positive stance on stablecoins, viewing them as a "force multiplier for American economic power," which ignited excitement in the audience.
Subsequently, stablecoin issuer Circle completed a $20 billion IPO, sparking what the "Bankless" podcast duo referred to as the "Summer of Stablecoins." Last week, the "GENIUS Act" was officially signed into law, becoming the first U.S. legislation to directly regulate digital assets, marking a turning point for global finance.
Even Jamie Dimon, who has personally expressed skepticism about cryptocurrency, has joined this movement. Despite publicly stating that he does not understand the appeal of cryptocurrency, there is a gap between his words and actions: the largest bank in America has long been a pioneer in blockchain technology, having been developing its own stablecoin, JPM Coin, since 2019.
So, what do these latest developments in the global value transfer space mean? What impact will the "GENIUS Act" have on the future of cryptocurrency, traditional finance (TradFi), and the global economy? I invited experts from technology, law, and finance to provide insights and analyze the technological advancements that may emerge in the coming years.
Core Summary: What is the "GENIUS Act"?
If you have been living under a rock, let me bring you out of the fog. The full name of the "GENIUS Act" is the "Guiding and Establishing National Innovation for U.S. Stablecoins Act of 2025," but "GENIUS" is catchier. This is the first comprehensive federal law in the U.S. regulating "payment stablecoins" (i.e., digital tokens pegged to fiat currency).
The "GENIUS Act" establishes a long-awaited licensing and regulatory framework for stablecoin issuers, requiring that stablecoins be fully backed by reserves on a 1:1 basis, implementing strict consumer protection measures, and laying a clear legal foundation for the integration of stablecoins into the mainstream financial system.
The law also prohibits non-financial companies like Facebook and Google from issuing stablecoins without special approval, imposing severe penalties for violations (with fines of up to $200,000 per day and criminal penalties including up to 5 years in prison).
Why is the "GENIUS Act" so important? Because in the U.S., stablecoin issuers have long been in a state of regulatory ambiguity and uncertainty, and this act provides the first federal legal framework that clarifies operational standards. As noted in a recent blog by international law firm Winston & Strawn LLP:
"The act brings stablecoin issuers into a bank-like regulatory framework. For many businesses, this means hiring compliance officers, investing in risk management systems, and potentially collaborating with experienced regulated entities to meet the standards set by Congress."
Utkarsh Ahuja, founder of the rapidly growing crypto investment fund Moon Pursuit Capital, shared his views on the groundbreaking significance of the "GENIUS Act":
"The 'GENIUS Act' is not only a significant advancement in the cryptocurrency space but also an important step for the U.S. in global financial leadership. For the first time, we have established clear rules for stablecoins, which are at the core of open, programmable monetary infrastructure. For a long time, regulatory uncertainty has hindered industry development, forcing developers to look overseas. This act changes that, providing legal clarity for stablecoins and laying the groundwork for broader applications of cryptocurrency."
Genna Garver, a partner at international law firm Troutman Pepper Locke LLP, also shared her perspective with CryptoSlate readers:
"This is a watershed moment for institutional financial services. The 'GENIUS Act' authorizes the tokenization of fiat currency and related regulations, thereby legitimizing digital dollarization."
The Perfect Storm for Digital Assets: A Comprehensive Upgrade
Alchemy is a developer platform that processes over $100 billion in transactions annually for businesses within the ecosystem, ranging from Fortune 500 companies like Robinhood, Visa, JPMorgan Chase, and PayPal to crypto-native firms like Coinbase and Circle. Its CTO, Guillaume Poncin, stated in written comments:
"The 'GENIUS Act' brings the long-awaited clarity that institutions have been seeking, facilitating the legitimization of programmable money at internet speed. The importance of this legislation lies in its reduction of regulatory uncertainty that has hindered institutional adoption."
Moreover, the introduction of the "GENIUS Act" is not an isolated event. The current government's support for digital assets is surging, leading to a comprehensive upgrade. The easing of the Biden administration's crackdown on cryptocurrency, along with the repeal of restrictive legislation such as SAB 121, which prohibited U.S. banks from providing digital asset custody services, has collectively created a perfect storm. Poncin excitedly remarked:
"We are seeing large banks that were previously cautious immediately showing interest. Now, with the implementation of the 'GENIUS Act,' we believe all major banks will issue or support stablecoins in some form. This will usher in a new era of programmable money that is trustworthy, regulated, and designed for internet-scale speed."
The act will also reinforce the dollar's dominance, promote dollar-based innovation, and solidify the dollar's status as a global reserve currency for decades to come. Chris Perkins, president of crypto-native investment firm CoinFund, commented:
"The 'GENIUS Act' will go down in history as foundational legislation that propels cryptocurrency into a mainstream asset class. By catalyzing innovation in the U.S.'s most core export product—the dollar—the act will ensure the dollar maintains its global reserve currency status for decades, enhance national security, and unlock financial opportunities worldwide.
Stablecoins offer clear utility by providing low-cost, 24/7 payment services. Additionally, by providing seamless and efficient access to dollars for developing countries, stablecoins can also serve as a store of value when local monetary policies fail."
Emergence of "Killer Applications" for Stablecoins
The use cases for stablecoins have far exceeded their initial role as a "store of value to avoid the volatility of digital assets like Bitcoin and Ethereum," and they are now recognized as critical financial infrastructure by landmark legislation. So, what major application scenarios will the "GENIUS Act" spawn? What can we expect in the coming years? Ahuja commented:
"The 'GENIUS Act' will unlock true innovation, including instant remittances, AI-native payments, and intermediary-free global trade."
Poncin added: "The opportunity for stablecoins is not in holding them, unless used for yield in DeFi. The real opportunity lies in enterprises issuing their own stablecoins, such as payment processors integrating stablecoins and fintech companies launching their own tokens.
We see fintech companies generating substantial revenue through fund management from stablecoin reserves. With a deposit scale of $2-3 billion, potential annual revenue could exceed $100 million. The true value creation of stablecoins lies in how they empower a new financial system."
In addition to attempting to issue their own stablecoins, JPMorgan made headlines this week by allowing clients (especially institutional clients) to use Bitcoin as collateral for loans. Thanks to the "GENIUS Act," the bank is developing new plans to allow clients to pledge Bitcoin or Ethereum for cash loans, similar to the model of using stocks or real estate as collateral.
While JPMorgan has allowed clients to borrow against crypto ETFs, accepting direct crypto assets as collateral is still a paradigm shift for institutions led by some of the industry's most outspoken critics.
The impact of the "GENIUS Act" extends across the entire industry, with DeFi platforms and tokenized RWA also receiving significant attention. Orest Gavryliak, Chief Legal Officer of DEX aggregator 1inch Labs, stated:
"Tokenization technology has become a core focus for traditional financial giants like BlackRock and JPMorgan, as it significantly optimizes the current financial standard system while greatly enhancing liquidity accessibility. With blockchain technology, tokenization breaks geographic limitations, allowing illiquid and fragmented markets to integrate and access global 24/7 multi-source liquidity in real-time."
Poncin further explained: "Banks will offer clients 'institutional-grade opportunities,' such as private equity transactions and lending against holdings. Small businesses will ultimately be able to leverage the advantages of remote work to pay overseas employees at low cost. What we are about to witness is not one, but hundreds of stablecoin 'killer applications' emerging, empowering value exchange and creation in ways that were unimaginable just months ago.
Tokenized government bonds are seeing significant growth. Stablecoin issuers like Tether hold substantial amounts of U.S. debt. We are seeing increased market interest in the tokenization of traditional illiquid assets like private credit and real estate to unlock liquidity. At the same time, the infrastructure that makes RWA combinable with DeFi protocols is also continuously evolving. The real innovation lies in making these assets programmable, which will give rise to new financial products, such as automated lending based on tokenized assets or smart contracts that interact with real-world collateral."
Will the "GENIUS Act" Give Rise to a "Super DeFi Summer"?
One interesting provision in the "GENIUS Act" is the prohibition on paying interest or yields to stablecoin holders, which may trigger a surge in demand for DeFi yield opportunities. Perkins stated:
"Under the 'GENIUS Act,' stablecoins do not pay interest to end users, making stablecoins depreciating assets. Holders will seek yields, and that is where DeFi comes into play. If the Treasury's predictions are correct, trillions of dollars in stablecoins will enter the market, and as users maximize returns through various yield strategies, we will see a 'Super DeFi Summer.' Users will be attracted to yield-generating vaults and delegate AI agents to optimize returns.
As the U.S. regains its leading position, countries around the world will have to accelerate the optimization of their own stablecoin policies. The $75 trillion daily forex market will benefit from this. Keep a close eye on this space."
Will Beeson, founder of MultiLiquid and former co-head of Standard Chartered's tokenization platform, commented: "The comprehensive ban on stablecoin yields marks a critical turning point. Capital has begun to shift. Ethereum is outperforming Bitcoin as traders seek returns through Ethereum-native protocols and tokenized funds."
The stablecoin market is entering a new phase, where only institutions that can efficiently utilize capital will survive. However, there is a bottleneck: stablecoins can operate 24/7, while government bonds cannot. Bridging this gap with liquidity infrastructure has now become a core priority."
Gavryliak added: "The regulatory clarity brought by the 'GENIUS Act' enables businesses and institutions to conduct fast, low-cost cross-border payments, fund optimization, and real-time settlements using stablecoins, bypassing traditional banking channels and unlocking operational efficiency. This is a positive advancement for DeFi.
It also provides assurance for institutions and other traditional financial participants, allowing them to fully engage in this space. Institutions that were previously just testing the waters can now enter comprehensively under a clear framework."
Will politics hinder this revolution?
As digital assets increasingly become a partisan issue, and core Democrats like Elizabeth Warren continue to lead the anti-crypto camp, is there a risk that the 'GENIUS Act' or other related legislation could be repealed if the Democrats regain power? Additionally, the Trump family's apparent financial gain from digital assets raises the question of whether this obvious conflict of interest poses a threat. Poncin believes it is too late:
"The momentum for cryptocurrency adoption transcends political divides. We are collaborating with institutions across various fields, all of which recognize the potential of blockchain. The repeal of SAB 121 has bipartisan support, with cryptocurrency advocates in both parties. Major banks, asset management firms, and payment companies are all positioning themselves in blockchain because it offers superior technology for settlement and programmable money.
Moreover, the cryptocurrency industry has demonstrated resilience through various challenges over the years. The key is that institutions are building real utility on blockchain, with applications that address real issues such as settlement speed, operational costs, and 24/7 availability, which is the driving force for lasting adoption."
Garver is also optimistic about the lasting changes brought by the 'GENIUS Act': "During the legislative process, there were multiple attempts to debate and propose amendments regarding conflicts of interest, but these amendments were not included in the final bill. Now, the final legislation allowing for the payment of stablecoins has been enacted, and the adoption of digital assets may depend more on use cases.
Similar to the proliferation of the previous generation of ATMs, when a technology is convenient and beneficial enough, people will ultimately accept it. I don't believe potential users will hesitate due to protests. I believe the trend is irreversible, and cryptocurrency will quickly integrate into the core of the U.S. economy, the global economy, and the financial services industry."
In the face of global debt expansion, liquidity growth, geopolitical uncertainty, and declining interest rates, the U.S.'s friendly regulation of digital assets may mean "this train is unstoppable." As Ahuja emphasized:
"Frankly speaking, from the perspective of addressing risks driven by events like tariff issues or escalations in the Middle East, this is the most constructive macro environment you could ask for. But from a pure market structure and liquidity standpoint, the conditions are ripe.
We are entering a rare window where fundamentals, liquidity, and macro dynamics are all improving, and this is the moment to unlock the greatest upside potential."
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
