Senate Passes Stablecoin Bill In Major Win For Crypto Industry (coindesk.com) 60
The U.S. Senate has approved the GENIUS Act with a 68-30 final vote that "saw a huge surge of Democrats joining their Republican counterparts," reports CoinDesk. What the bill sets out to do is create the first federal regulatory framework for U.S. stablecoins, requiring issuers to maintain full 1:1 reserves in cash or Treasuries, adhere to regular audits and anti-money laundering rules, and gain regulatory approval -- all while allowing foreign stablecoin access under strict oversight rules. From the report: As written, the bill would set up guardrails around the approval and supervision of U.S. issuers of stablecoins, the dollar-based tokens such as the ones backed by Circle, Ripple and Tether. Firms making these digital assets available to U.S. users would have to meet stringent reserve demands, transparency requirements, money-laundering compliance and regulatory supervision that's also likely to include new capital rules. "This is a win for the U.S., a win for innovation and a monumental step towards appropriate regulation for digital assets in the United States," said Amanda Tuminelli, executive director and chief legal officer of the DeFi Education Fund, in a similar statement. [...]
While this is the first significant crypto bill to clear the Senate, it's also the first time a stablecoin bill has passed either chamber, despite years of negotiation in the House Financial Services Committee that managed to produce other major crypto legislation in the previous congressional session. The destiny of the GENIUS Act is also tied closely to the House's own Digital Asset Market Clarity Act, the more sweeping crypto bill that would establish the legal footing of the wider U.S. crypto markets. The stablecoin effort is slightly ahead of the bigger task of the market structure bill, but the industry and their lawmaker allies argue that they're inextricably connected and need to become law together. So far, the Clarity Act has been cleared by the relevant House committees and awaits floor action.
While this is the first significant crypto bill to clear the Senate, it's also the first time a stablecoin bill has passed either chamber, despite years of negotiation in the House Financial Services Committee that managed to produce other major crypto legislation in the previous congressional session. The destiny of the GENIUS Act is also tied closely to the House's own Digital Asset Market Clarity Act, the more sweeping crypto bill that would establish the legal footing of the wider U.S. crypto markets. The stablecoin effort is slightly ahead of the bigger task of the market structure bill, but the industry and their lawmaker allies argue that they're inextricably connected and need to become law together. So far, the Clarity Act has been cleared by the relevant House committees and awaits floor action.
noo, my chase sapphire points! (Score:2)
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Totally agree.
Fuck those assholes.
Re:noo, my chase sapphire points! (Score:5, Interesting)
I wouldn't cry if rewards went away. But I definitely benefit from them. I don't know what my interest rate is, but my effective rate is zero. I pay the card in full every month. If I can't, I don't make the purchase. Never paid a fee in over 20 years.
Luckily, in my adult life, I never had to fund an emergency on credit. That's not a privilege everyone has.
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What fees?
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What fees?
Transaction fees, paid by the merchant.
Of course, like any cost of doing business for the merchant, the cost is passed onto the customer. In the case of credit card transaction fees and the rewards they fund, what happens is that people who don't use cards with expensive transaction fees subsidize the rewards for those who do. In most cases that means poor people and people who manage money poorly actually pay for the perks of rich people and people who manage money well.
Personally, I shamelessly maxi
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Ah that's what I figured you meant. Yeah I'm the same, I ALWAYS pay off my card each month and I rake in the rewards. My mother on the other hand, who is on a fixed budget, insists on paying with her debit card all the time because she is scared of credit cards.
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My mother on the other hand, who is on a fixed budget
Aside: That phrase "fixed budget" and its twin "fixed income" always strike me as curious. I mean, short of changing jobs, most of us have a fixed income and therefore a fixed budget... and changing jobs isn't necessarily an option.
I guess maybe it's just a euphemism for "small income" or "small budget".
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Yes, I wasn't being technical. She's retired and living off her pension + SS.
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Yes, I wasn't being technical. She's retired and living off her pension + SS.
Yeah, I figured that. My point was just that "fixed" is just an accurate description of my income/budget (and probably yours) as it is of hers. I knew what you meant, I was just pointing out that the terminology we use doesn't make sense.
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We are a Constitutional democratic republic.
So what happened with the direct banking scheme? (Score:1)
the scam (Score:3)
I admit I haven't read the legislation but here's my speculation.
You give someone your real money, and they give you some kind of digital tokens that people have to believe represent the real money. And then you can trade that around with those faithful folks to your heart's desire. The transactions are relatively cheap on both ends.
Meanwhile that entity possesses your real money and can invest it in something that generates real income. Heck, money markets yield more than 4% these days. Amazon will sell their own stablecoins, which means you would give them a sizable hunk of your real money and use it to buy their products. In exchange for a minor discount. Meanwhile Amazon controls your real money and makes a bundle on it.
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Oh, crypto is real in a sense I agree but it isn't real money. In the sense that you pay real money to get crypto and receive it to cash out.
And hey, I don't really care about your retirement status.
Re:the scam (Score:4, Insightful)
Crypto is as real as stocks
This is completely, totally wrong.
When you buy a share of stock, you're buying part of a real enterprise that produces and sells some sort of good or service, and has some sort of real-world assets (offices, factories, equipment, etc.), structured and managed to (hopefully) generate real profits by delivering real value to real people who want to buy it.
Cryptocurrencies are nothing at all like that. With them, you're buying some bits that have value only because people think they have value.
Some people might think that "has value only because people think it has value" is also a description of fiat currency, but that's just as wrong as equating stocks with cryptocurrencies, though that's a more complicated topic for another post.
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Re:the scam (Score:4, Informative)
the value of a cryptocurrency often reflects ...
The price of a cryptocurrency reflects those things. It's value is zero. Period. There is nothing behind it.
While they are not backed by tangible goods, neither are fiat currencies or many derivatives
No, fiat currencies are backed by debt, meaning that real people and companies have made enforceable legal commitments to do real work to generate the value backing the dollars or whatever. Without getting into the details, every time a dollar is created, that creation is balanced by the creation of a dollar of debt, the commitment of some productive entity to produce value to repay that debt (and thereby destroy that dollar). As a common example, when you borrow money to buy a house, the bank doesn't lend you money [*] that other people deposited, it creates that money out of thin air at the same instant you sign an enforceable contract to repay it, meaning you commit to do some sort of value-producing work to generate the value of those dollars.
Derivatives represent specific legal contracts to perform some action, e.g. buy a fixed amount of stock from the derivative seller on or by a specific date for a specific price, and those contracts get their value from the underlying security. That underlying security can also be some sort of contractual obligation rather than a hard asset, but if you keep digging down the layers you always get to something real. It's always possible, of course, that the layers of repackaging make the actual value hard enough to see that its price becomes divorced from that value (and stock pricing also gets divorced from underlying value to various degrees), but at bottom there must be something of actual substance. Further, if markets were perfectly efficient, it would not be possible for the price to move away from the value.
None of this is true with cryptoassets. Their true value is zero (arguably, negative, since proof of work is a pure sink that generates no utility), so any price above zero represents market inefficiency/insanity.
[*] It used to be that the bank created most of the money under the fractional reserve system, but for quite a while now most of the developed world has abandoned the reserve lending requirements, enabling banks to effectively create all of the money they lend. This might seem like a crazy system, but it's actually pure genius because it allows the money supply to expand and contract with the economy, which along with Keynsian fiscal policy massively reduces the boom and bust cycles we regularly experienced before we switched from metallic to fiat currency.
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There is unbreakable cryptography behind it. Science and math. That is 'harder' currency than any fiat that will ever exist. A truly secure and sound form of money, along with the transparency to shine light on all the corporate corruption in the world.
Now. Tell me again it has no value.
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there is nothing behind it
There is unbreakable cryptography behind it. Science and math. That is 'harder' currency than any fiat that will ever exist. A truly secure and sound form of money, along with the transparency to shine light on all the corporate corruption in the world. Now. Tell me again it has no value.
Happy to: It has NO VALUE.
The problem here is that your definition of "value" is invalid. Your claim is equivalent to saying that shares of Apple stock have value because we have built systems to ensure that ownership of them is unique and non-duplicable, and that the supply is finite. But that is not what makes shares of Apple stock valuable. What makes them valuable is that they represent partial ownership of a company that produces and sells hundreds of millions of useful devices every year, among othe
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Is it going to be marketed like Banks (Score:5, Insightful)
We have basically all the elements now needed for a great depression.
Climate change means we are going to have increased food prices and shortages. Bird flu isn't going to help either.
The trade wars being used to counterbalance the incoming tax cuts for billionaires are here too just like in the 20s and 30s
And the Senate is ramming through 5 to 7 trillion in tax cuts for the 1%, so we have out of control trickle down economics.
And of course we're gearing up for war, in this case with Iran maybe even China at some point.
Everything we need for a great depression. Good job guys good job.. we never fucking learn.
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Yes, but like 90% live in cities today while a huge portion did not a century ago. Population is almost 8 times as many people largely due to oil...& tech making that possible; one can't just labor at farming to earn or produce some food like used to be possible (plus seeds are IP owned.) Also, local produce is often industrial crops (corn or animal feed) while actual food is imported. People seem less capable of socializing; generally, less capable period (yeah knowing phone apps is so useful...) Clim
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And people are going to find out the hard way that they are not banks. When that happens it will take the entire economy down. If you are smart enough to see past this they will drag you down with them Great depression style.
If these stablecoin issuers are required to maintain 1:1 reserves in cash/treasuries as the summary indicates, it seems like they'd be less of a systemic risk than real banks. Not more.
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Stable coins are not always stable... (Score:2)
So just obtain and keep dollars.
Stable coins have repeatedly not really been stable, as the entities that say they have dollars in reserve equal to the stable coins never do. Crypto has value for money laundrying and most of it is held and manipulating by a small pool of holders.
Grifters do make money, sometimes tons of it, on the naivety of the rubes... eh "investors." Grifters gonna grift.
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I'm not really arguing for the utility of stablecoins. I don't hold any and don't see any compelling reason why I need to - a government-insured checking account covers all of my needs.
But:
If these stablecoin issuers are required to maintain 1:1 reserves in cash/treasuries as the summary indicates
I don't really see how they can be a systemic risk to the financial system.
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Read: The Number Go Up! [goodreads.com]
Basically, "stable coins" of the near past do not hold the dollars necessary to be "stable."
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And people are going to find out the hard way that they are not banks. When that happens it will take the entire economy down. If you are smart enough to see past this they will drag you down with them Great depression style.
We have basically all the elements now needed for a great depression.
Climate change means we are going to have increased food prices and shortages. Bird flu isn't going to help either.
The trade wars being used to counterbalance the incoming tax cuts for billionaires are here too just like in the 20s and 30s
And the Senate is ramming through 5 to 7 trillion in tax cuts for the 1%, so we have out of control trickle down economics.
And of course we're gearing up for war, in this case with Iran maybe even China at some point.
Everything we need for a great depression. Good job guys good job.. we never fucking learn.
Lets face it, most people don't even have a clue what banks actually do, what laws they're supposed to abide by, which regulations apply and how those regulations are meant to protect them. Banks like it this way because they get to say "Regulation baaad, money go burrrr" and have people parrot it like sheep.
Modern economies need banks to function... but as organisations should never be trusted. I've heard few more foolish things than "but the bank is my friend"... especially when they think the bank is
YAFS (Yet Another Financial System) (Score:5, Insightful)
Like I've said before, [slashdot.org] this is just yet another financial system being created to have a minority of people manage the majority of the wealth, to their own advantage. This is just a new competing system created by the crypto bros to wrestle the current system away from the Wall St. bros.
And that "huge surge of Democrats joining their Republican counterparts"? Well whaddaya think that big money in the crypto world is buying up right now, besides new yachts? Money talks, baby, and remember, elections coming up again soon (it never fucking ends!).
You know I wish they were just corrupt (Score:2)
It's because they believe way way too much in the system. They think they can work with the Republicans on stuff like this. And they think they can get regulators out there to protect people if they have a law in place. Never mind Donald Trump basically firing anyone who could d
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This bill might be a good thing. The devil is in the details and that is where the loopholes are. I would guess with wide support at this time it means it's not blatantly bad. The staffing cuts the GOP pushed long ago continue so there is a lack of internal review; relying upon 3rd parties (which means dependence on untrustworthy lobbyists.)
The general purpose seems clear enough and if the bill is vague enough a few good judges could make it work in the end. Future refinements might help with holes in the
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this is just yet another financial system being created to have a minority of people manage the majority of the wealth, to their own advantage. This is just a new competing system created by the crypto bros to wrestle the current system away from the Wall St. bros.
With very critical difference that the stuff sold by the Wall St. bros is repackaged ownership of real stuff. Real enterprises that make real products for real people, real commodities that people need, real debts that people have made legal commitments to repay, etc. The Wall Street bros.' stuff has actual value behind it, even if that value is obscured through many layers of packaging.
What the crypto bros have to sell is nothing. Nothing at all. The early promise of cryptocurrencies was that they wo
Trump corruption (Score:5, Interesting)
The Guardian says ‘I have never seen such open corruption’: Trump’s crypto deals and loosening of rules shock observers [theguardian.com]. The article is worth reading and highly concerning.
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Speaking of which, there's an interesting article in BI this morning with Mark Cuban opining on the true reason for the new cellphone endeavor: https://www.businessinsider.com/mark-cuban-trump-phone-crypto-wallet-transaction-fees-world-liberty-2025-6
A Coin By Any Other Name... (Score:3)
What edgy cryptocurrency name are they going to give it? I just can't wait for my salary to be paid in xXxDogeMcStableface2.0xXx.
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What edgy cryptocurrency name are they going to give it? I just can't wait for my salary to be paid in xXxDogeMcStableface2.0xXx.
it's in the act
The U.S. Senate has approved the GENIUS Act
Trump TotallyStableGeniusCoins, get yours today.
Quite the opposite (Score:1)
The crapto scam "industry" lost. Full reserves, regulation and audits is what these assholes want to avoid. Now they are getting that and that means they are not really different from a regular bank anymore. As a result, most (all?) will simply have to close up shop, because there is no way they can fulfill these requirements.
sounds promising.. (Score:1)
I have not read the actual bill, but from the description it seems like good things in general.
The 1:1 requirement is the safe option, though with other regulations in place a high fractional part with a pooled resource insurance would likely be better in the long run.
The stable coin thing of today is just a black box with "trust me bro"
Sigh (Score:5, Insightful)
"stringent reserve demands, transparency requirements, money-laundering compliance and regulatory supervision"
Whoops... well, there goes your independent cryptocurrency and lack of accountability.
You're now basically using a coin linked to the dollar that has the same reporting requirements as the dollar. So why not just use the dollar?
Let's be honest - the reason cryptocurrencies took off is LACK of regulation (and this is not a good thing). As soon as you regulate them, they become largely useless compared to just having a number in your bank account.
E.g. money laundering compliance means knowing the source and destination of every transaction. It's now "worse than just using cash" for many, many users.
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Let's be honest - the reason cryptocurrencies took off is LACK of regulation (and this is not a good thing). As soon as you regulate them, they become largely useless compared to just having a number in your bank account.
Very well put.
Crypto bros think what they'll get from regulation is respect and trust, and they're right. But that respect and trust will arise from transparency, and that transparency will also show that the emperor has no clothes. Proper regulation of cryptocurrencies will spell the eventual end of cryptocurrencies, at least as they exist today. It'll take a while, but it will happen.
Perhaps along the way someone will come up with a cryptocurrency design that actually works as a currency, providing
Because nobody expects laws to be enforced (Score:3)
It's going to collapse and when it does you're going to have tons of people who thought they were using a bank and found out they had no protection whatsoever.
We have already seen that scam with various companies acting like Banks and holding money for people and people losing all their money when they find out it's not FDIC insured.