A historic occasion able to reshaping the world monetary panorama happened inside the partitions of the US Senate in June this yr. Lawmakers handed the GENIUS Act (Guiding and Establishing Nationwide Innovation for U.S. Stablecoins Act) — the first federal regulation in US historical past establishing complete rules for stablecoins, cryptocurrencies pegged to the greenback. The adoption of the invoice, with uncommon bipartisan help in at the moment’s Washington (68 votes in favour towards 30), marks a turning level not just for the crypto trade but in addition for the world financial system. Why this regulation is so vital, what hidden pitfalls it accommodates, and what penalties await Russia and the BRICS international locations — digital economist Ravil Akhtyamov explains in an unique column for Realnoe Vremya.
US authorities goal to tame cryptocurrency unicorns
At the coronary heart of the GENIUS Act lies the precept of most transparency and investor safety. The regulation introduces a compulsory 100% backing of all issued stablecoins with extremely liquid belongings. Because of this for each digital coin denominated in US {dollars}, the issuer is required to carry an precise greenback in reserve or its equal in short-term Treasury payments (T-bills). For instance, if an organization points tokens value $1 billion, its reserve accounts should comprise precisely $1 billion in money or authorities bonds. The composition of those reserves is topic to necessary month-to-month disclosure — a measure aimed toward stopping eventualities like the collapse of TerraUSD in 2022.
The safety of stablecoin holders is one other cornerstone of the laws. In the occasion of the issuer’s chapter, the claims of token holders take priority over these of different collectors. For main gamers with a market capitalization exceeding $50 billion, the regulation imposes a requirement to endure annual impartial audits in accordance with strict federal requirements. This can be a direct response to scandals surrounding the lack of transparency of the largest stablecoin, Tether (USDT).
Combating monetary crime and making certain nationwide safety type the third key pillar of the GENIUS Act. All issuers wishing to function in the US market are required to implement full-scale KYC (Know Your Buyer) and AML (Anti-Cash Laundering) methods consistent with banking rules. They have to conduct buyer due diligence, monitor suspicious transactions, and adjust to all sanctions regimes. Technically, issuers are obligated to make sure the capacity to immediately freeze or “burn” (destroy) tokens at the request of regulators or regulation enforcement companies to be able to halt criminality.
The regulation additionally units clear restrictions on the circle of entities allowed to situation stablecoins. Giant know-how corporations (Massive Tech), akin to Meta* (Fb**), Apple, or Amazon, fall under a direct ban. The motivation is to forestall the focus of immense monetary energy in the arms of companies that already wield monumental affect over the digital sphere and person information. Overseas corporations shall be permitted to situation stablecoins for the American market solely after receiving particular approval from the Federal Reserve System (FRS) and on the situation of full compliance with US requirements. Notably noteworthy is the modification prohibiting present high-ranking authorities officers, together with members of Congress and their fast relations, from being beneficiaries or executives of stablecoin-issuing corporations. This provision was launched in response to high-profile conflicts of curiosity, which shall be mentioned under.
Trump, $TRUMP Memecoin, and thousands and thousands in lobbying
The adoption of the GENIUS Act can’t be considered outdoors the context of the unprecedented lobbying strain from the cryptocurrency trade. In response to open sources, throughout the 2024 election cycle alone, crypto corporations and affiliated teams spent greater than $119 million in help of “pleasant” Congressional candidates. The trade actively promoted the narrative of the bipartisan nature of crypto innovation, in search of backing from each main events.
Nonetheless, a severe battle of curiosity looms over the regulation attributable to the private involvement of US President Donald Trump. It’s recognized that Trump holds a major stake in the firm World Liberty Monetary, which has already launched the USD1 stablecoin. Furthermore, since the starting of 2025, the president has been actively selling the $TRUMP memecoin, created at his initiative, whose market capitalisation at its peak reached $645 million. Though the modification regarding authorities officers partially addresses the situation, it doesn’t have an effect on the president’s private belongings, that are formally held in a blind belief managed by his youngsters.
The Democratic opposition voiced robust substantive criticism of the invoice. The principle concern is the inadequate safety towards dangers related to the actions of international stablecoin issuers, who may probably use such devices to avoid sanctions or finance undesirable actions. One other severe argument is the potential destabilisation of the US authorities debt market. The mass buy of short-term Treasury payments (T-bills) by stablecoin corporations to again their reserves may make this key market extra unstable and extra delicate to sudden large-scale redemptions from stablecoins, which may set off an increase in bond yields and enhance the value of servicing the nationwide debt for all taxpayers.
World penalties: Tether in the crosshairs, greenback strengthens
Consultants evaluate the GENIUS Act to the 2000 Commodity Futures Modernisation Act, which loosened oversight of derivatives forward of the 2008 disaster. It’s a assortment of half-measures that may create the regulatory look of legitimacy however is not going to eradicate the dangers. The principle menace is a possible chain response in the occasion of a stablecoin collapse.
A drop in worth under $1 has already occurred (USDC in March 2023 — all the way down to $0.87, Tether in Might 2022 — all the way down to $0.95). In the occasion of a mass outflow, reserves (Treasury bonds) shall be offered off, triggering a liquidity disaster. Banks issuing stablecoins (Wells Fargo, Financial institution of America are in negotiations) would come under strain.
The results of the GENIUS Act will prolong far past the United States, hitting key gamers and reshaping world monetary flows.
Essentially the most susceptible is Tether (USDT) — the undisputed market chief with a capitalisation exceeding $110 billion. The corporate, whose headquarters are positioned outdoors the US (primarily in Hong Kong and different jurisdictions), will face a dilemma. To serve American purchasers (authorized entities, exchanges, institutional traders), it’s going to both must create a US-based subsidiary totally compliant with the GENIUS Act or persuade the Federal Reserve of the adequacy of its requirements. It will require unprecedented transparency: detailed month-to-month reporting of reserves in keeping with US requirements and present process impartial audits. If Tether can not or doesn’t need to comply, it dangers successfully being blocked from entry to the huge American market and companions, which may set off a large capital outflow from USDT.
A broader impact is the additional strengthening of the world hegemony of the US greenback. The GENIUS Act de facto establishes the world commonplace for stablecoin regulation. Nations and firms round the world in search of to combine into world monetary flows shall be compelled to align with these guidelines or danger isolation. This creates a robust barrier for different initiatives, akin to BRICS international locations’ fee methods, that are being developed partly as instruments for de-dollarisation. Companies, particularly these working in worldwide markets, shall be compelled to predominantly use stablecoins suitable with American rules. Moreover, US sanctions control will acquire a brand new highly effective software: the capacity to demand the freezing of tokens concerned in “prohibited” transactions, wherever in the world they happen, in the event that they concern American issuers or counterparties.
Dangers for Russia: vulnerability of USDT and the urgency of countermeasures
For Russia, the penalties of the GENIUS Act could also be tangible and unfavorable in the quick time period. The principle menace is linked to the widespread use of the USDT (Tether) stablecoin as a software for worldwide settlements, circumventing sanctions, and peer-to-peer transactions inside the nation.
The brand new regulation will increase the danger of blocking USDT influx channels. American regulators will acquire expanded powers to strain crypto exchanges and P2P platforms to stop servicing customers from sanctioned jurisdictions, together with Russia. KYC procedures on world exchanges shall be tightened. Main platforms (Binance, Bybit, and many others.), aiming to take care of entry to the American market or companions, shall be compelled to implement draconian identification measures for all customers. It will sharply enhance the danger of account blocking for Russian purchasers, even these utilizing VPNs.
It would create a menace of “tokenised sanctions”. The technical capacity to immediately freeze tokens at the request of US regulators may very well be used towards particular wallets or transactions related to the Russian economic system or people.
These challenges make the accelerated improvement of nationwide options not simply fascinating, however critically vital. The important thing areas of response ought to be:
- Accelerated implementation of the digital ruble as a dependable, sanctions-resistant basis for home and — probably — cross-border settlements inside the EAEU and with pleasant international locations.
- Creation and help of authorized nationwide crypto alternate platforms and infrastructure working inside Russia’s authorized framework and built-in with the banking system, to cut back dependence on susceptible worldwide providers.
- Improvement and adoption of complete laws regulating the issuance and circulation of crypto belongings in Russia, with an emphasis on investor safety and prevention of illicit use, however with out extreme restrictions that stifle innovation.
- Exploration and improvement, along with BRICS, SCO, and EAEU companions, of mechanisms for sanctions-resistant cryptocurrency fee corridors, probably based mostly on mutual recognition of nationwide stablecoins or central financial institution digital currencies.
BRICS response: a dollar-free buying and selling platform
The menace to greenback hegemony, intensified by the GENIUS Act, will pressure BRICS international locations to speed up the creation of a sovereign buying and selling platform. Its rules characterize a break with the Western system. Firstly, full foreign money sovereignty: a ban on pricing not solely in US {dollars}, euros, kilos sterling, or yen. All contracts shall be denominated completely in nationwide currencies (rubles, yuan, rupees, reals, rands) and a brand new “BRICS settlement unit” — a digital token backed by a commodity pool (gold, oil, grain, uncommon earth metals). Secondly, technological independence on the blockchain: transactions shall be recorded in a decentralised ledger with information storage nodes in Moscow, Shanghai, Mumbai, São Paulo, and Pretoria, eliminating exterior control or blocking. To forestall rule circumvention, AI monitoring shall be applied, immediately blocking makes an attempt to point a “USD equal” or hidden conversion.
The sensible operation of such a platform shall be clearly demonstrated in the power sector: a Russian oil exporter lists quite a bit in rubles and BRICS items. The Indian purchaser sees the worth robotically transformed into rupees and the identical BRICS items. No greenback as an middleman foreign money — technically excluded by the system’s structure. Settlements are made immediately by built-in central financial institution digital currencies (digital ruble, digital yuan).
BRICS international locations could create a secure digital foreign money for mutual settlements. Its basis shall be the union’s banking system: particular Operator Banks will situation and redeem tokens, whereas Custodian Banks will securely maintain reserves. The backing will encompass a basket of BRICS currencies (ruble, yuan, rupee, actual, rand + currencies of recent members), held as deposits in these banks. It will scale back dependence on the greenback and SWIFT, decrease the value of cross-border funds amongst member international locations, and strengthen the position of nationwide currencies. The success of the mission will depend on agreeing the weights of currencies in the basket, unified regulatory requirements, and the selection of the technological platform.
If by 2026, 15% of BRICS commerce turnover passes by the platform, it’s going to collapse demand for USDT in Eurasia, make the BRICS settlement unit (stablecoin) an alternate reserve asset, and pressure the EU to debate becoming a member of the system on phrases of sanctions aid.
What’s subsequent? The trail to Trump’s signature and market eventualities
Regardless of Senate approval, the GENIUS Act is just not but regulation. Its additional destiny will depend on a number of steps.
- Coordination with the Home of Representatives. The decrease chamber of Congress, dominated by Republicans, has already handed its personal model of stablecoin regulation — the STABLE Act. Now a advanced technique of reconciling a unified textual content in a convention committee lies forward. The details of rigidity:
- Federal control and states’ rights. The Senate model strengthens federal regulators (the Fed, Treasury), whereas many Home Republicans advocate for a better position for states in oversight.
- The White Home technique. President Trump publicly helps the speedy legalisation of stablecoins. His digital belongings advisor, Beau Hines, has said the administration’s want to signal the regulation by August 2025. This could give Trump a robust card forward of the 2026 US Senate elections — the alternative to place himself as the president who legalised cryptocurrencies and boosted innovation. The potential enhance in the worth of World Liberty Monetary’s belongings, linked to Trump, also needs to not be underestimated.
- Situations for the Crypto Market. The end result of the legislative saga will decide investor sentiment.
- Optimistic state of affairs (speedy adoption of clear guidelines). Progress in institutional investor confidence, inflow of main capital, explosive development in the capitalisation of regulated stablecoins (forecasts — as much as $5 trillion by 2030) and the whole crypto trade. Strengthening the positions of leaders compliant with requirements (USDC by Circle).
- Pessimistic state of affairs (delays or adoption of the regulation with “strangling” provisions). Investor flight from “non-compliant” tokens (primarily USDT, but in addition decentralised DAI), a pointy liquidity drop, a market crash of 20–30%, and a chronic interval of uncertainty. Strengthening the place of offshore, opaque platforms.
Sovereignty in the digital age at stake
The GENIUS Act is just not merely “technical guidelines for cryptocurrencie”. It’s a highly effective software of economic geopolitics pursuing a number of strategic targets of the United States.
Strengthening the world position of the greenback in a quickly digitalising economic system by establishing a world commonplace for its digital equivalents. Enlargement of US jurisdiction and control over cross-border monetary flows by crypto belongings. The sanctions mechanism good points a brand new, high-tech dimension. Suppression of different monetary methods and de-dollarisation initiatives, akin to BRICS initiatives, by creating excessive boundaries to entry and compelling the use of devices “suitable” with American guidelines.
For Russia, the state of affairs calls for fast and decisive motion. Accelerating the launch of the digital ruble, creating nationwide crypto infrastructure, and establishing sanctions-resistant settlement mechanisms with key companions will not be problems with the distant future, however pressing duties of at the moment. The adoption of the American regulation is a sign: the period of unregulated “digital {dollars}” is coming to an finish; the time of strict guidelines and the wrestle for monetary sovereignty in the digital house is starting.
Ravil Akhyamov
Reference
* recognised as extremist; its actions are banned on the territory of the Russian Federation
** A social community banned in Russia, owned by Meta*, which is designated as extremist; its actions are banned on the territory of the Russian Federation
