Yesterday President Trump signed the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act into law, clearing the path for dollar-backed stablecoins. As I’ve argued before, the future of money is a new model of trust, and this legislation provides the regulatory certainty needed for that trust. 

The GENIUS Act is a landmark piece of legislation. It establishes a dual charter system, enabling both federal and state-regulated stablecoin issuers. The key provisions are precisely what the industry needed: a mandate for 1:1 reserves with high-quality liquid assets like cash and short-term treasuries, a prohibition on reusing those reserves, and the designation of issuers as financial institutions under the Bank Secrecy Act. This isn’t just about compliance; it’s about building a foundation of trust that can be exported globally.

The most immediate effect will be a surge in demand for US treasuries as issuers build their reserves, further cementing the dollar’s role in the global financial system. This will undoubtedly cause concern in other countries worried about increased dollarization (see Italy’s Finance Minister), but for the US, it’s a strategic win. We are effectively creating a pathway for the dollar to become the native currency of the internet. My message to bank CEOs, this is a massive opportunity to guide how this act impacts all payments.

The strategies of incumbent banks and stablecoin issuers are now coming into sharp focus. Stablecoin issuers like Circle and Coinbase are pursuing a two pronged strategy: legitimacy (ie compliance) and Ecosystem/Platform. The push to secure banking licenses is about achieving regulatory parity and the institutional credibility that comes with it. Simultaneously, their real goal is to build the core infrastructure for the digital economy. This means forging partnerships with wallets, exchanges, and fintechs to embed their stablecoins as a fundamental utility, and developing programmable money. Non-banks and new platforms face a start up problem as encumbanks have deep advantages. As PayPal’s PYUSD proved, consumers don’t know what stablecoins are for. While Stripe and Shopify make it easy for a merchant to accept stables, speed and finality aren’t consumer value propositions… why on earth would they stop using their card?

The big banks, for their part, are not sitting idle. They are moving to co-opt this technology for their own advantage. Some, like J.P. Morgan with its Kinexys platform, are building their own permissioned digital currencies, and tokenizing deposits and assets for both internal and institutional use. For the broader market, bank strategy is likely to make public stablecoins “just another rail.” Banks will act as the primary on and off ramps, provide custody for digital assets, and integrate stablecoin payments into their existing treasury and cash management platforms. For their corporate clients, the bank’s goal is to abstract away the complexity. The customer will simply see a faster, cheaper international payment, unaware of the underlying stablecoin transaction that made it possible.

Let’s be clear about the current state of play. Today, roughly 90% of stablecoin volume is related to the clearing of crypto trades, with the largely unregulated Tether dominating the market and having become the seventh largest buyer of US treasuries in the process. The GENIUS Act will fundamentally alter this dynamic. It will accelerate the use of stablecoins in a multitude of real economy use cases, sparking a fight for dominance among a new class of regulated issuers. In this new landscape, I believe US banks are best placed to capture and dominate existing payment flows (like trade finance and remittances) by integrating stablecoins into their current offerings. The more nimble, non bank issuers are set to lead the charge in the new, edge use cases where legacy systems do not exist.

So where will we see the most immediate progress?

First, B2B cross border payments and treasury management. This is the lowest hanging fruit. The ability for a multinational corporation to move millions of dollars between subsidiaries in minutes instead of days, with full transparency and lower cost, is a revolutionary improvement. This will be the first area to reach mass adoption within the corporate world.

Second, as the settlement layer for tokenized real world assets. As we see more assets like bonds, real estate, and private equity represented as tokens on a blockchain, a regulated, on chain dollar is required for instantaneous settlement (delivery versus payment). This market is still nascent but represents a multitrillion dollar opportunity.

Third, in digitally native edge UCs. This includes everything from international eCom marketplaces, gaming and creator platforms to new digital marketplaces. These ecosystems need a payment method that is as fast, global, and programmable as the internet itself. Stablecoins are the natural fit.The GENIUS Act is the start of a wave of non-crypto use of Stablecoins with large banks set to dominate investment. We’ve talked about the role of data in payments and how new payment models emerge. Now, the landscape is set. The winners will be those who build trusted solutions that solve these real world problems. They are problems because current solutions don’t solve them well. The historical evolution of payment models and the future of banking both point to a future where traditional finance, digital currency, trust and aspects of Web 3.0 will transform how we think about money.