Wall Street and Consumer Advocates Urge Revisions to GENIUS Act
U.S. bankers are challenging provisions of the newly signed stablecoin law, known as the GENIUS Act, which is seen as a step towards regulating the crypto industry. Key points include:
- The American Bankers Association and consumer advocacy groups have expressed concerns over allowing state-chartered uninsured depository institutions to provide nationwide money-transmission and custody services.
- They argue this provision bypasses state licensing and oversight, potentially leading to regulatory arbitrage.
- Bank lobbyists are pushing for the removal of sections that could allow crypto firms to indirectly offer interest on stablecoins, fearing it may divert deposits away from traditional banks.
- The GENIUS Act was signed by President Trump, but more comprehensive legislation, the Digital Asset Market Clarity Act, is pending and could amend the stablecoin law.
These developments indicate ongoing tension between traditional banking interests and the evolving landscape of cryptocurrency regulation in the U.S.