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HOW THE GENIUS ACT WILL LEAD TO CRYPTO-DOLLARS
The pace of regulatory and executive actions pertaining to the cryptoasset and blockchain sectors continues to accelerate, with the first ever U.S. digital asset press conference, the Senate Banking Committee continuing to discuss and roll back debanking initiatives, and SEC Commissioner Hester Peirce’s Crypto Task Force already making progress in establishing guidelines and frameworks for crypto regulation.
With the flurry of headlines and soundbites it would be easy for investors and policy advocates to overlook an important throughline in virtually every policy move under the new Trump administration to date; strengthening and improving the U.S. dollar’s place as the global reserve currency via dollar backed stablecoins.
Senator Bill Hagerty introduced the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, aiming to regulate US dollar-pegged crypto tokens, which according to public comments will focus on creating a safe and pro-growth environment for cryptoassets.
The GENIUS Act builds on previous efforts to integrate stablecoins into the U.S. financial markets and banking system, including the Clarity for Payment Stablecoins Act.
The GENIUS Act details several important aspects of potential forthcoming stablecoin regulation, but will also help accelerate the policy conversation around a crypto-dollar.
The GENIUS Act Increases Specificity To Stablecoins
Some of the much-needed specifics and clarity that the stablecoin sector has been searching for include, but are not limited to, the following.
First, the bill as it is currently written and being discussed defines stablecoins as digital assets pegged to the U.S. dollar, which would seem to undermine efforts for commodity based or algorithmic-based stablecoins.
Second, the bill seems to be advocating federal level regulation for two stablecoins in particular via the $10 billion market capitalization threshold for federal regulation; USDT and USDC.
Since these two stablecoins combined have a market capitalization of nearly $200 billion, obtaining greater regulatory clarity over these two dollar-backed stablecoins is imperative toward greater adoption and utilization by both individuals and institutions.
An additional point of clarity embedded in the bill is the requirement that stablecoin issuers will have to undergo financial audits of reserves on a monthly basis. Seemingly a simple requirement, this addition highlights one of most difficult aspects of stablecoin regulation to date.
Tether and the USDT token have been, and remain, the dominant dollar-backed stablecoin by a large margin but have been beset by (justifiable) questions around the accounting for reserves and other financial reporting practices for years.
The GENIUS Act, by (in essence) specifying these reporting requirements and oversight at the federal level, are setting the groundwork for comprehensive, consistent, and comparable regulation for stablecoins seeking to operate in U.S. markets.
The GENIUS Act Will Lead To Crypto Dollars
One of the most important discussions connected to tokenized assets and especially stablecoins is something that is outside of the crypto; how can the United States take effective action to maintain the reserve currency status of the U.S. dollar?
The dollar has faced challenges to its geo-political dominance in the past, but few instances of these challenges have been combined with the shifting political landscape unfolding at the present.
The European Union, partially due to increasingly strident language by the U.S. related to tariffs and NATO-affiliated defense spending, is looking to expand the use of the euro on a global basis.
China, the second largest economy in the world and definitive rival to the United States, is expanding trade, infrastructure, and use of the yuan on a continuous basis.
Lastly, the BRIC nations are actively seeking to develop and deploy a joint currency, which would seek to serve as an international medium of exchange.
@ Newshounds News™
Source: Forbes
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BRICS: US SIGNALLING RECESSION AS TRUMP TARIFF IMPACT LOOMS
There is no understating of the concern that is taking place within geopolitics this month. As the BRICS and US face-off, the latter is signaling an incoming recession with the potential impact of President Donald Trump’s 100% tariff plan looming large. Indeed, he had already instituted and delayed such import taxes on Mexico and Canada.
Now, the country is set to contend with China on implemented 25% tariffs. All the while, the United States is facing increased economic uncertainty across a host of sectors. Moreover, one key facet of its financial standing is showing evidence that a recession may be incoming.
BRICS Facing Tariffs and US Facing Recession as Geopolitical Tensions Grow
During his campaign for reelection, Donald Trump warned of 100% tariffs on BRICS nations. He justified the action as a way to preserve the US dollar, targeting a collective that has sought to settle trade in their local currencies. Yet he has since expanded that as he prepares to tariff Mexico, Canada, and others.
With the economic policy proving to be his weapon of choice, the United States economy is set to feel the effects. More importantly, as BRICS prepare to face those policies, the US is signaling a recession as those Trump tariff impacts loom large over the nation.
According to data from Global Markets Investors this week, the US job market is flashing recession signals. Specifically, the Bureau of Labor Statistics data shows that the hiring rates as a percentage of total employment dropped in December. Specifically, the figure fell to 3.2%, its second lowest market since the 2020 COVID-19 crisis.
This drop is concerning. It places hiring well below the pre-pandemic 3.8% average that was present from 2015 to 2019. Additionally, it fuels the ongoing concern regarding a labor market that is cooling extensively. For so long, the Federal Reserve had used a thriving labor market to justify its interest rate cuts. Its slowdown could have dire consequences for an economy coping with much more nuanced issues.
@ Newshounds News™
Source: Watcher Guru
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