Author | Dingdang, Odaily
Recently, the stablecoin bill "GENIUS Act" passed the Senate debate motion with 69 votes in favor and 31 votes against, officially entering the revision stage. Possibly boosted by this positive news, Bitcoin broke through $110,000 for the first time in four months, creating a new historical high.
Currently, the global stablecoin market size has exceeded $200 billion, gradually becoming the core pillar connecting traditional finance and the blockchain world. However, behind the prosperity, there are unavoidable problems - reserve fund transparency, systemic risks, and the long-missing regulatory framework.
Against this background, the US Senate Financial Services Committee proposed the "GENIUS Act", intending to set an institutionalized tone for this rapidly developing field. The bill requires stablecoin issuers to hold 1:1 high-quality reserve assets (such as US Treasury bonds or cash) and prohibits stablecoins with interest attributes to reduce potential financial risks. Previously, Odaily detailed the bill's specifics in the article "GENIUS Act Likely to Pass Senate, Stablecoin Regulation Sees Historic Breakthrough", which interested readers can refer to.
Now, the "GENIUS Act" has entered the revision stage, and the crypto industry's sentiment has also heated up. This bill, viewed as a milestone in US stablecoin regulation, has sparked significant discussion within the industry.
Review of Hotly Debated Clauses
As a bill that has sparked widespread discussion, it reflects the regulatory layer's dual focus on the growing importance and potential risks of the stablecoin market.
On the surface, it only establishes rules for stablecoins; but looking deeper, it attempts to clarify: When stablecoins gradually assume the crucial role of USD digitization and cross-border payments, who should be granted issuance rights? What stabilization mechanism can be trusted? And how to prevent systemic risks from being transmitted on-chain?
To understand the true intent of this bill, we might start with the most discussed clauses:
Explicit prohibition of "yield-bearing" stablecoins. Simply put, no issuer can pay interest or other forms of returns for users' held stablecoins. This clause seems simple but directly sounds an alarm for many DeFi projects relying on yield mechanisms. The bill's intention is to cut the blurry zone between stablecoins and traditional high-risk yield products, preventing potential financial bubbles, but it directly targets decentralized stablecoins, posing a huge survival challenge for innovative stablecoins like Ethena.
Strict limitations on reserve fund systems. The bill requires all stablecoins to maintain a 1:1 reserve ratio, and these reserves must be high-quality, highly liquid assets like US Treasury bonds, cash, or federal deposit insurance. This is equivalent to "insuring" stablecoins and means that projects maintaining stability through algorithmic adjustments or pledge mechanisms may need to make difficult choices.
Restrictions on issuer qualifications. The GENIUS Act explicitly excludes certain "special individuals" from stablecoin issuance, such as tech leaders like Elon Musk and David Sachs. The signal is clear: regulators do not want individuals or large tech companies to have excessive currency issuance rights in the digital currency field to avoid trust crises or market misjudgments.
Besides these three core clauses, another point worth discussing is that the original bill draft allowed some foreign stablecoins to circulate in the US, provided their issuing country has a regulatory framework similar to the GENIUS Act. However, the latest revised version hands this discretionary power to US Treasury Secretary Scott Besent, not only strengthening regulatory flexibility but also granting the government more sovereign control space.
Four regulations, four thresholds, each redefining "who can play and how to play". While protecting investors, it also makes clear: the world of stablecoins is no longer a land of "wild growth".
Multiple Perspectives: A Booster Paving the Way for DeFi or a Restrictive Shackle on Innovation?
Both supporters and skeptics are voicing their opinions. Odaily has combed through the perspectives of several key industry figures, presenting the complex reality behind this regulatory storm from different angles.
(Translation continues in the same manner for the rest of the text)@cmdefi added: "Most existing projects do not meet the requirements of the bill, and this seems more like a framework prepared for new institutional entrants. The demand for fully decentralized stablecoins still exists, such as those resistant to censorship and not pegged to the US dollar, but the path to implementation will be more tortuous."
Feng Liu, former editor-in-chief of Chainnews, from another perspective, pointed out that the bill's ban on interest-bearing stablecoins will force many decentralized projects to rethink their product structure. In his view, this change is more likely to encourage decentralized projects to further strengthen their decentralized characteristics, rather than trying to integrate into the compliance system.
