The Big Loser From the ‘Genius Act’ Is $156 Billion Crypto Giant Tether
Bill laying out rules for stablecoins would force issuers like Tether to be audited and end risky practices
Congress is set to bring stablecoins into the financial mainstream, with legislation that has sparked a frenzy of interest from startups, banks and even retailers like Walmart that were previously wary of cryptocurrencies.
But the bill, known as the Genius Act, has a tough message for Tether, the No. 1 player in stablecoins: Shape up or get kicked out of the U.S. market.
linkI think regulation is fair in this case because from the start, USDT has always been tied to the US dollar, which is the most powerful currency globally ( i think)... The law just formalizes things to protect users and ensure that every token is backed 1:1 with real USD. And, the US benefits since the issuer needs to purchase treasury bonds, which indirectly strengthens their economy.
But now, there’s a big difference compared to before. Even though USDT still uses the crypto network for transactions, it’s practically like a bank now. Anyone using it is subject to audits, strict KYC, and anti-money laundering checks, so privacy is basically gone in this area.
Another thing is that issuers can’t offer staking or interest-bearing services anymore because the law is very strict on that. It looks like they only want these issuers to make money from transaction fees and nothing else.