Or… the switch to a popularist movement that will gain public support.
Circle (CRCL) will benefit from the GENIUS Act in the United States as the first Stablecoin set to take advantage of new regulatory parameters (U.S. Government) it has the behind the scenes backing of BlackRock (BLK) which for me was a key indicator in its likely upcoming success story.
Hong Kong’s Stablecoin Ordinance also support the rise of stablecoins.
Stablecoins are gaining more adoption and regulatory momentum than government-issued digital currencies. CBDCs have not gained support, Bitcoin and other digital currencies were initially designed to break free from Central Banking currencies in general.
So how do you get around the growing resistance that seemed to be building over CBDCs?
You move your money into a financial institution like BlackRock and then you have BlackRock become the primary shareholder of the world’s primary Stablecoins.
The U.S. Government during the pandemic moved trillions over to BlackRock, hence our massive debt, and now we have a Stablecoin that is pinned to the U.S. Dollar and Treasuries whose primary shareholder is BlackRock.
Governments are now crafting legal structures for stablecoin growth rather than pushing CBDC adoption. Hong Kong introduced its Stablecoin Ordinance, while the U.S. passed the GENIUS Act to guide issuance standards. These developments suggest that fiat-backed digital assets have become a more feasible alternative to CBDCs.
https://coincentral.com/cz-declares-cbd … bal-focus/
Stablecoins achieve their price stability through various mechanisms. As I understand it, they are:
Fiat-collateralized: Each token is backed by reserves of the fiat currency such as T-Bills. Examples include USDC (Circle) and USDT (Tether).
Algorithmic: Use of software to expand or contract supply in response to price deviations, without holding collateral. Over-collateralized crypto assets, managed by smart contracts. These I personally don’t see as Stablecoins and I am unsure that they meet the requirements laid out in the Genuis Act to gain government/regulatory support.
A CBDC, by contrast, has no additional collateral. Its value is based on the regulatory authority of the central bank. Users trust that the central bank will maintain the peg to the national currency, just as it does with physical cash.
Both the National governments and their Central Banks (fiat currencies) are losing the faith of their respective populations. As the debt Western nations are carrying balloon to unsustainable and irreversible amounts, as the Dollar has reached today, we are nearing a time when support for these currencies and the governments they back could fail.
If Central Banks and the Banking system as we know it, is about to ‘fail’ the world needs some form of alternative system to work off of, and in place, before it does.
Stablecoins currently drive much of the activity in decentralized finance (DeFi), enabling cross-border remittances and rapid trading on crypto exchanges without relying on traditional banking rails. Their permissionless nature allows innovation, but also exposes participants to smart-contract vulnerabilities and counterparty risk, a risk much minimalized when meeting the regulatory and oversight requirements set forth in the Genuis act.
Finding the sweet spot between government regulation and overwatch and freedom from Central Banking control the likes of which we have today could be the future of ‘currency’, if done properly.
If you are a person who believes in investing in the future, I suggest you do your research on the matter, and then look into the leading Stablecoins that have already met the criteria set out in the Genuis Act… you may be getting in at the bottom of what will become the next Amazon or Google at what is essentially pennies on the dollar… first movers always have the advantage.
