Under the dome of Capitol Hill in Washington, as Trump's pen crosses the last line of the GENIUS Act, at that moment, in a Manhattan mansion thousands of miles away, a hedge fund manager is paying a Nigerian supplier with USDT - transferred in 0.1 seconds with a fee of only $0.3. This tiny on-chain ripple is gathering into a tsunami that will reshape the global financial order.
01 Dual Titans: The Warring States Era of Stablecoins - #USDT (61.2% market share): Holding $120 billion in US Treasury bonds, surpassing Germany's national reserves, effectively becoming the 19th largest US debt holder. Its focus has shifted to the P2P remittance market, with penetration rates as high as 43% in emerging countries
-#USDC (24.4% market share): Riding the compliance tailwind, its market value has doubled to $61 billion, with 100% cash and short-term government bond reserves, holding top-tier licenses from FinCEN, EMI, etc., aiming to become the "first stablecoin stock" with an IPO in 2025
Decentralized forces are rising through the cracks. #EthenaLabs' #USDe, with its Delta-neutral hedging strategy, has skyrocketed from $146 million to $6.2 billion, becoming the third-largest stablecoin; #MakerDAO's #USDS, after rebranding to Sky, has exceeded $2.6 billion, seizing the DeFi high ground through compliance transformation.
02 Legislative Revolution: How GENIUS Reforges US Dollar Hegemony The GENIUS Act, passed on May 20, 2025, marks the official upgrade of stablecoins from a "regulatory gray area" to a US dollar digitization strategic tool: -Reserve Shackles: Mandatory 100% US dollar asset reserves (cash only, short-term debt within 93 days, money market funds), cutting off algorithmic stablecoins' lifeline -Interest Isolation: Prohibiting issuers from paying interest, isolating user funds in bankruptcy, ending Tether's arbitrage model of investing reserve funds in Bitcoin -Geopolitical Firewall: Foreign stablecoins must register and be regulated in the US, tech giants forbidden from issuing without permission, specifically suppressing China's digital yuan's cross-border expansion
Behind the act is a naked calculation of US dollar hegemony. When institutions like #Tether allocate 90% of reserves to short-term US bonds, they objectively form a hidden bond-purchasing force - stablecoin issuers may become one of the largest US debt holders by 2030, providing blood transfusion for the $36 trillion fiscal deficit. US Treasury Secretary Bessent frankly stated: "We will use stablecoins to maintain the US dollar's world reserve currency status".
03 Yield War: The Life-and-Death Gamble of High-Yield Stablecoins When the GENIUS Act blocks interest-bearing stablecoins, an innovative yield war erupts in the regulatory blind spot. #DWFLabs' #FalconFinance (@FalconStable) will become the breakthrough dark horse: its synthetic dollar protocol #USDf supports minting with collateral assets like $BTC, $ETH, with an annual yield up to 14.3%, integrating #Chainlink oracles and #Pendle yield platforms to build a Delta-neutral hedging matrix, maintaining stability in volatile markets
This model is essentially a regulatory arbitrage art - using UAE's lenient policies to circumvent US bans, then achieving "non-interest high yields" through on-chain combination strategies. Currently, its TVL has exceeded $580 million, attracting massive institutional funds fleeing low-yield #USDC.
04 Political Bet: Trump's Stablecoin Ambition The Trump family's tentacles have long penetrated the stablecoin territory. Their supported #USD1 (issued by World Liberty Financial @worldlibertyfi) mysteriously rose before the act:
Launched in March 2025, market value broke $2 billion in May, entering the global top seven
Democratic Senator Warren directly denounced it as a "political donation shadow channel", suspected of circumventing traditional bank supervision to transfer funds to specific camps
The more ingenious design is at the policy level. The "Bitcoin Strategic Reserve Act" will incorporate 200,000 seized $BTC into a permanent non-sale reserve, forming a "sovereign asset + private stablecoin" dual-track system with the GENIUS Act. This avoids direct bitcoin purchase fiscal controversies while freezing 6% circulation to boost price, providing value support for US dollar stablecoins.
Geopolitical risks hang like the Sword of Damocles. The truth of #Tether holding $120 billion in US debt is binding the stablecoin foundation to the US debt powder keg - if US debt credit collapses, #USDT will become the first domino. As Hong Kong's Stablecoin Regulation allows partial commercial paper reserves, the Eastern camp is constructing a differentiated regulatory framework, and this monetary war has just begun.
When Mexican farmers buy seeds with #USDT, when Filipino programmers receive salaries in #USDC, they won't realize: they have become the capillaries of the US dollar 2.0 system.
The GENIUS Act is not the end, but the starting gun for sovereign monetary digitization competition.
