US Government Pushing Stablecoins to Boost US Dollar: Sygnum
The United States government views dollar-pegged stablecoins as a crucial element in reversing the declining status of the US dollar as a global reserve currency, according to a report by Sygnum. The administration is advocating for the growth of the stablecoin market and is pushing Congress to pass the GENIUS Act, which seeks to regulate stablecoins in the US. This Act, which recently passed the Senate, aims to establish a regulatory framework for stablecoins and their issuers. Sygnum highlights that the demand for US dollars, particularly from retail sectors in developing countries facing inflation, underlines the potential of dollar-denominated stablecoins to meet these needs and sustain the dollar's dominance. However, resistance to US dollar stablecoins is growing internationally, especially from the BRICS nations advocating for a multipolar financial system. Experts from Sygnum express caution regarding the impact of stablecoins on dollar dominance, emphasizing the need for increased retail adoption in emerging markets to have a substantial effect.
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