The American Pivot and Wall Street 2.0
New legislation like the GENIUS Act shifts stablecoin yield generation to DeFi, while federal charters increase competition between crypto firms and traditional banks.Summary
The GENIUS Act restricts interest-bearing stablecoins, pushing yield generation into DeFi structures like staking, a move banks oppose. Industry experts note that while direct passive yield is banned, stablecoin issuers can still launch DeFi platforms to distribute yield.
Federal charters are significantly altering the balance of power by granting crypto-native firms like Circle and Paxos institutional standing, allowing them to compete directly for core payment and settlement services without relying on legacy banks. However, experts caution that incumbents still hold advantages in distribution, balance sheet depth, and client trust, meaning the competition is shifting toward scaling trust and distribution.
Furthermore, while the GENIUS Act establishes a federal framework for stablecoins, state-level innovation is constrained under this new era of "cooperative federalism." The larger unresolved issue remains token classification, which the CLARITY Act aims to address by creating a 'Maturity' test to allow tokens to graduate from 'security' status to 'Digital Commodity' status once a network is sufficiently decentralized.
(Source：BeInCrypto)