U.S Government Regulate Ripple’s RLUSD, USDC, USDT
American lawmakers plan to establish a clear regulatory framework for stablecoins.
The Guiding and Establishing National Innovation for U.S. Stablecoins Act, or GENIUS Act, was introduced by one Democratic lawmaker, Kirsten Gillibrand, and three Republican senators, Cynthia Lummis, Tom Scott, and Bill Hagerty.
It establishes reserve and licensing standards for issuers and defines stablecoins as digital assets based on the US dollar.
Protecting consumers and fostering financial innovation in the cryptocurrency space is its goal
Moreover, the proposed regulation employs several oversight procedures according to the stablecoin’s financial capacity. Businesses with assets in circulation valued at more than $10 billion must follow Federal Reserve rules.
Tether and Circle, whose stablecoins, USDT and USDC, have market capitalizations of $140 billion and $55.1 billion, respectively, are anticipated to be the most affected.
Ethena USDe, DAI, and the newly launched Ripple USD are among those that fall below the $10 billion threshold and will be permitted to function under state-level regulations.
The document included procedures for a waiver process, which would permit issuers who surpass the limit to continue being subject to state regulation. According to Senator Hagerty, the GENIUS Act will foster innovation and growth and help realize President Donald Trump’s audacious goal of making the US the global hub for cryptocurrency.
“My legislation creates a regulatory framework that is safe and supportive of growth, which will spur innovation and further the President’s goal of making America the global center of cryptocurrency.”
Senate Banking Committee Chair Tim Scott emphasized the value of stablecoins in contemporary finance, pointing out their ability to enable speedy and affordable transactions. He highlighted that it will ensure the U.S. stays competitive in the crypto ecosystem.
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