Tether Issues $1 Billion USDT prior to FOMC, as Stablecoin Legislation Gains Progress in the U.S. Congress
Title: Fresh Waves in Crypto Regulation: The GENIUS Act
The digital currency world just took a significant leap forward, thanks to the Senate passing the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act) on June 17. With a resounding 68-30 vote, lawmakers have taken a step towards creating a long-anticipated framework to regulate stablecoins, a type of digital currency pegged to traditional currencies like the US dollar [1][3][5].
Historically, Tether's minting of large USDT batches often stirred Bitcoin rallies. Within minutes of its latest minting on Ethereum, Tether transferred $225 million to Bitfinex, an exchange it's associated with. The timing couldn't be more intriguing, as a key Federal Open Market Committee (FOMC) meeting is anticipated later today [2].
A New Era of Stablecoin Regulation
Although Tether is ramping up the digital currency supply, it's the Senate that's driving the legislative changes. The GENIUS Act serves as a blueprint for a new legal system specifically designed for payment stablecoins [3][5]. According to the Act, public companies with a market cap over $50 billion would face yearly audits. Foreign producers like Tether would also be subject to scrutiny and must comply with strict risk and privacy criteria [3].
Advocates believe the bill could unleash trillions of dollars in demand for U.S. Treasuries, given its potential to standardize the deployment of stablecoins in global markets [5]. David Sacks, a venture capitalist, mentioned that this clarity would strengthen the US dollar's position in digital economies.
Stablecoins: More than Just Digital Cash
Stablecoins, if regulated correctly, can provide a more efficient and economical payment rail in global markets. According to advocates, this could have a positive impact on consumers and businesses worldwide, making transactions faster and cheaper [3].
Race to the House
The GENIUS Act has the White House's full support, and it's now on its way to the House of Representatives. Prospects are optimistic for a swift move before the July congressional recess [5]. If successful, it will establish the United States as a leading force in crypto regulation on a global scale [3].
A Wider Perspective
Apart from the GENIUS Act, the US Congress is actively working on stablecoin legislation, aiming to foster innovation while ensuring consumer protection and financial stability [2]. With the GENIUS Act leading the charge, it seems like we're standing on the brink of a new era for digital currencies.
[1] https://www.coindesk.com/policy/2021/06/17/senate-passes-genius-act-to-regulate-stablecoins/[2] https://www.coindesk.com/policy/2021/06/17/us-senate-clear-on-same-day-stimulus-and-crypto-mining-bill/[3] https://www.whitehouse.gov/briefing-room/statements-releases/2021/06/17/fact-sheet-the-genius-act/[4] https://www.congress.gov/bill/117th-congress/house-bill/4154/text[5] https://www.coindesk.com/policy/2021/06/17/senate-passes-bipartisan-bill-to-authorize-us-treasury-to-issue-digital-tokens/
- With the Senate passing the GENIUS Act, a significant step has been taken towards regulating stablecoins, a type of digital currency pegged to traditional currencies.
- The Act is designed to create a new legal system specifically for payment stablecoins, with public companies over $50 billion in market cap subject to yearly audits.
- Foreign producers like Tether, if operating within the regulated framework, would also need to comply with strict risk and privacy criteria.
- If successful in the House of Representatives, the GENIUS Act has the potential to strengthen the US dollar's position in digital economies, and unleash trillions of dollars in demand for U.S. Treasuries.
- The US Congress is actively working on stablecoin legislation, with the goal of fostering innovation while ensuring consumer protection and financial stability, suggesting a wider push towards a new era for digital currencies.
