The GENIUS Act has established a regulatory framework for US-issued stablecoins, aimed at enhancing trust and potentially driving mainstream adoption. Supporters believe it will bolster the dollar's status as the global reserve currency and could attract institutional interest in decentralized finance (DeFi). However, concerns persist regarding the act's vague regulations on foreign issuers and the prohibition of yield-bearing stablecoins, which may disadvantage US issuers competitively. The act allows for foreign stablecoins to be sold in the US under comparable regulations, but the criteria for 'comparable' are unclear. This has led to projections of significant market activity as US commercial banks and large corporations consider launching their own stablecoins. The Act also significantly impacts US debt demand, with Treasury Secretary Scott Bessent forecasting that dollar-linked stablecoins could grow to $2 trillion in market capitalization. Critics argue that without yield, stablecoins may serve as depreciating assets, possibly making them less competitive in the long run, although institutional investors could seek alternative yield mechanisms. The GENIUS Act is viewed as a critical step toward mainstream adoption of stablecoins despite existing uncertainties.

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