U.S. President Donald Trump on Friday signed a landmark stablecoin act into law at a White House ceremony, the first federal regulation in this regard.
The Guiding and Establishing National Innovation for U.S. Stablecoins Act, or GENIUS Act, was passed by the U.S. Senate in June and by the House of Representatives on Thursday.
Trump has been a supporter of the bill and recently intervened in persuading some Republican lawmakers to vote for it.
"The GENIUS Act creates a clear and simple regulatory framework to establish and unleash the immense promise of dollar-backed stablecoins. This could be perhaps the greatest revolution in financial technology since the birth of the Internet itself," said Trump.
The act lays out standards for stablecoins, a kind of digital currency pegged to the U.S. dollar or other fiat currencies.
The Federal Reserve and the Office of the Comptroller of the Currency would undertake overseeing of stablecoin issuance, according to the GENIUS Act.
The act also creates requirements for issuers to regularly share information about their reserves in the form of U.S. currency, demand deposits, Treasuries and other "approved assets."
Trump suggested that he would go further to make the United States the crypto capital of the world, and the use of stablecoins would increase the demand for U.S. treasuries, lower interest rates, and secure the dollar's status as the world's reserve currency.
With an estimated market capitalization of around 250 billion dollars, the dollar stablecoins are primarily used as an intermediate asset for trading or a tool for accessing the dollar in countries with hyperinflation or other monetary issues.
Trump signs stablecoin act into law
Trump signs stablecoin act into law
Trump signs stablecoin act into law
