Original Article Title: With the GENIUS Act Passed, Can Crypto Compete With Banks?

Original Source: Unchained

Original Translation: TechFlow DeepTide

· Host: Laura Shin

· Guest: Dante Disparte, Chief Strategy Officer and Global Head of Policy and Communications at Circle

· Air Date: July 19, 2025

Key Points Summary

After years of hostility, the United States has finally passed its first federal law regarding the crypto industry.

The bipartisan stablecoin legislation known as the "GENIUS Act" became law after a last-minute standoff in Congress, signed by President Trump. While the bill was considered a "done deal," this week saw a tumultuous process as the Democratic Party objected to Trump's ties to cryptocurrency, and the Freedom Caucus suddenly rebelled against the Central Bank Digital Currency (CBDC) provision.

Now that the bill has passed, what impact will it have? Who will benefit or be harmed by it?

In this episode, Dante Disparte, Chief Strategy Officer of Circle—one of the key figures behind this legislation, explained the following:

· How the bill garnered bipartisan support in a politically charged environment

· Why banks may think twice before issuing stablecoins

· Why Circle is applying for a national trust bank charter

Additionally, the show discussed the controversy surrounding interest-bearing stablecoins, how this bill fits into a broader financial regulatory framework, and whether American consumers and the dollar will benefit from it.

Highlights Summary

· The right to currency use should be as free as possible.

· The key is that the crypto industry has finally received the legalization it has long sought, a clear path in U.S. law and regulation, and an opportunity for competition.

· The significance of the "GENIUS Act" goes far beyond cryptocurrency itself. It may be the first financial regulatory act in U.S. history aimed at promoting growth, competition, and consumer protection, with its core focus on setting clear rules for the market, building a rule-based competitive environment.

· The "GENIUS Act" has set clear rules for the market, with the ultimate biggest winners being American consumers and market participants, while further solidifying the role of the dollar in the global economy.

· The most important aspect of the "GENIUS Act" is the concept of international reciprocity, which empowers the U.S. Treasury to promote the U.S. regulatory framework globally. This is crucial as it ensures that the U.S. can take a leading role in setting international rules rather than passively accepting rules from other countries. This applies not only to cryptocurrency but also to the global use of stablecoins.

· Throughout my career, I have often represented U.S. interests at international institutions and governmental banking meetings. Despite being a representative of the private sector, this time the U.S. finally has formal speaking rights in the development of these rules.

· There remains a significant gap in global financial access, with both the U.S. and other countries in urgent need of alternative payment systems. In the future, many companies may compete around data, seeing data as an asset. In this era where data is called the "new oil," can blockchain become the "new tool" to carry this data? This is a question worth pondering.

· The fully reserved stablecoin model addresses a core issue of early cryptocurrency—consumers' regret over price fluctuations. This asset is not only a pricing mechanism for crypto transactions but also a significant medium of exchange in the digital economy.

· The "GENIUS Act" and the forthcoming U.S. Market Structure Regulation Act will gradually shift cryptocurrency and blockchain technology from visible applications to more fundamental infrastructure, with their impact becoming more apparent over time.

· I hope that in the next five years, we will not only be able to solidify the US dollar as the core currency of the internet economy and leverage it as a strategic advantage for the United States in global competition, but also enable more people to access secure and reliable smart device-based financial services.

“Crypto Week” Better Than Expected

Laura: For the crypto industry, this is a very significant moment. This week marks the end of what Congress calls “Crypto Week.” The legislation we are discussing, the GENIUS Act, which is the United States' first major crypto legislation, will soon be signed into law by President Trump. This bill, the result of years of collaborative effort by multiple members of Congress, aims to regulate the development of stablecoins. Before we started recording, you mentioned that you have been fighting for this for seven years. While many people initially believed this bill would smoothly pass at the beginning of this administration, the actual process of advancement turned out to be more convoluted.

So, what caused this suspense, and how did it eventually pass?

Dante: Yes, if “Crypto Week” didn’t have some political maneuvering and dramatic elements, it would seem incomplete. One of the biggest dramatic events this week was the action against Central Bank Digital Currency (CBDC), which indeed took many by surprise.

However, the key is in the final results, and these results actually exceeded everyone's expectations. Firstly, the GENIUS Act passed with over 300 votes, with 102 Democratic and Republican members of Congress jointly supporting it. The passage of this bill in the current highly polarized political environment in the United States is clearly a significant bipartisan achievement, reflecting national interests and the crucial role of the dollar in the global economy. This is undoubtedly a great accomplishment.

In addition, two other bills also made significant progress. The Clarity Act is the House’s response to legislation on the crypto market structure, which also received broad bipartisan support and is expected to undergo thorough discussions in the Senate. Another provision against CBDC further indicates that the US will actively engage in global digital currency competition through regulating the dollar's stablecoin.

How the GENIUS Act Garnered Bipartisan Support Amidst Major Political Friction

Laura: As you mentioned, indeed, this bill ultimately received widespread support. However, during the advancement process, we also saw much opposition from Democrats towards the Trump administration's commercial activities related to cryptocurrency, especially the World Free Financial Company's launch of its stablecoin.

I am curious, how was the Democratic Party persuaded to vote in greater proportion for this bill? After all, in the early stages, this seemed rather unlikely.

Dante: First and foremost, crypto legislation has become a bipartisan issue of shared concern in the United States. This led me to joke that I have twice brought Washington together in my career. The first time was with the launch of the Libra project, where both Republicans and Democrats found common ground in their opposition to the project, sparking numerous hearings and controversies. Nevertheless, this opposition led to an unexpected unity between the two parties.

Fast forward to today, this bill underwent numerous hearings, inter-agency meetings, and public consultations. The Biden administration issued an executive order on digital assets, while the Trump administration took a sincere and growth-oriented whole-of-government approach to driving the development of relevant technologies, especially in the realm of artificial intelligence. However, without addressing these key interests properly, including potential political divides, the "GENIUS Act" would have struggled to garner support from 18 Democratic senators in the Senate, let alone achieve such a significant success in the House. Therefore, this is undoubtedly a major victory.

For us, the key is that the crypto industry has finally obtained the legalization it has long sought, a clear path in U.S. law and regulation, and an opportunity for competition.

Why Dante Believes This Bill's Significance Goes Beyond Cryptocurrency Itself

Laura: Currently, Circle is widely seen as one of the biggest winners of this bill. So, what specific provisions does this bill have regarding the regulation of which types of companies? Which companies are included, and which are excluded? Clearly, some companies are able to conduct stablecoin-related business legally in the United States, while others need to meet higher standards to enter this field. Could you briefly explain the impact of this bill on different types of participants and how it changes their business models?

Dante: First and foremost, I believe that the "GENIUS Act" goes far beyond just cryptocurrency. This may be the first financial regulatory legislation in U.S. history aimed at promoting growth, competition, and consumer protection, with its core focus on establishing clear rules for the market and building a rule-based competitive environment. I am delighted to share some of the unique aspects of this bill.

First and foremost, it retained each state's regulatory authority over banking and payments, which has been a significant barrier in the past when attempting to legislate stablecoins. The U.S. financial system exhibits a form of "Fintech Federalism," where each state independently regulates banking and payments. The "GENIUS Act" respects and continues this tradition. Furthermore, as per the Act, banks, non-bank entities, and credit unions can issue dollar-denominated payment stablecoins at a scale of $1 billion or more. These entities need to fall under the federal regulatory framework primarily overseen by the Office of the Comptroller of the Currency (OCC), while also fostering the potential for international competitiveness.

The Act also contains many subtle provisions, such as those regarding the portability of international products, ensuring that products compliant with similar regulatory structures in other countries can freely move between the U.S. and abroad. Of note is the so-called "Libra Clause." Under this provision, if a non-bank or commercial entity wishes to issue a stablecoin, or those products that may be classified as Vanity Stablecoins (TechFlow note: Vanity Stablecoin is an emerging stablecoin concept primarily tailored to individual or brand customization needs. It allows users to create a stablecoin with a unique identifier based on their preferences or identity, typically leveraging blockchain technology.), they not only need to establish a separate entity (similar to Circle, rather than a bank) but also must address a series of antitrust issues and ultimately obtain approval from a special committee of the Treasury Department. This sets up an essential safeguard for the market while also raising the entry barrier. For banks, if they plan to issue stablecoins under the "GENIUS Act," they must establish a separate entity, separate from their core banking operations, and manage the issuance and redemption of stablecoins in a wholly different manner, rather than operating as they would with traditional bank lending and credit creation. This regulatory approach is even more conservative than the so-called era of deposit tokens.

This also raises an important question: Are banks willing to adopt a conservative asset-liability management strategy, avoid risks, leverage, and lending, and solely focus on stablecoin issuance? Or are they more inclined to engage in this niche market competition by providing core banking services? Overall, this Act establishes clear rules for the market, and I believe the ultimate biggest winners are U.S. consumers and market participants, while also further solidifying the U.S. dollar's position in the global economy.

How Circle Plans to Compete with Banking Giants

Laura: Let's delve into the moves of the major banks once again. This week, Bank of America, JPMorgan Chase, and Citibank are all striving to roll out stablecoins or at least considering the matter. While this Act does not entirely cover the actions of these banks, they do operate in the same field as Circle. JPMorgan Chase is also planning to launch a deposit token. Currently, Circle's USDC is primarily used for transactions and decentralized finance (DeFi), becoming its largest commercial partner through its collaboration with Coinbase. Furthermore, USDC will also be used by millions of Shopify merchants on Coinbase's Base network.

Therefore, currently Circle is more like a crypto-native project, while these banks have a larger presence among non-crypto users, which is obviously a larger market. So, how does Circle compete with these major banks?

Dante: This is an interesting question. I believe that in the ongoing discussion of digital currency competition between banks, non-banks, and even central banks, our operating model and long-term belief have been that once very clear guardrails are established, a tokenized form of money is not the breakthrough; in fact, the breakthrough in banking and payments is on the infrastructure level.

Our long-term vision is to build an internet-based financial system that enables global fund and financial services interoperability through blockchain technology. As you are aware, USDC is a multi-chain innovation designed to drive interoperability between different blockchains. It aims to build trusted financial infrastructure that can bring funds and financial services to areas beyond the reach of traditional banking and payment systems.

This is not a strategy of opposition to banks. In fact, our strategy heavily relies on cooperation with banks, leveraging the trust and security frameworks they have built in the real economy. The passage of the "GENIUS Act" will undoubtedly trigger competition on multiple levels, a competition that is a positive driving force for the U.S. economy and the entire market category. It is also a pathway to ensuring the scaled adoption of digital assets and cryptocurrencies, as all of this requires full interoperability with the traditional financial system.

Another key point is that prior to the passage of the "GENIUS Act," the U.S. lacked a clear framework for regulating cryptocurrency and non-bank payment systems. Taking the Libra project as an example, due to the lack of relevant laws in the U.S., Libra eventually chose to establish itself in Switzerland, as Switzerland was able to regulate it as financial infrastructure. The implementation of the "GENIUS Act" provides the U.S. with a "U.S.-first" institutional framework while avoiding the limitations of a "U.S.-goes-it-alone" approach. This allows companies like Circle and other U.S. enterprises, including traditional banks, to compete in the global market without concerns about their business models or internet-based digital dollar being restricted by rules from other countries. This is particularly important as the competition between stablecoins and central bank digital currencies (CBDCs) is increasingly becoming the focus of the global financial sector. Discussions over the past week have shown that many countries and financial institutions are trying to reduce their reliance on the U.S. dollar while seeking alternative payment systems.

Laura: Okay, I'd like to confirm one of your points. I initially thought this act was mainly aimed at domestic U.S. business activities, but from your description just now, it seems it may also have an impact on the use of stablecoins in other countries?

Dante:Exactly. This is actually a key provision in the "GENIUS Act," which was originally introduced in the House of Representatives. You may recall that there were differing proposals regarding stablecoin regulation between the House and the Senate. The House's proposal was known as the "Stable Act," while the Senate's proposal was the "GENIUS Act."

In the end, the "GENIUS Act" incorporated many of the House version's enhancements and thus garnered support from 102 Democratic lawmakers. One of the most critical points is the concept of international reciprocity, which empowers the U.S. Treasury to promote the U.S. regulatory framework globally. This is crucial because it ensures that the U.S. can take a leading role in shaping international rules, rather than passively accepting rules from other countries. This applies not only to cryptocurrencies but also to the global use of stablecoins. Personally, this is also a significant milestone for me. Throughout my career, I have often represented U.S. interests in international institution and central bank meetings, albeit as a private sector representative. However, this time, the U.S. finally has a formal voice in shaping these rules.

What Does Circle Hope to Achieve by Applying for a National Trust Bank Charter

Laura: At the end of June this year, Circle submitted an application to establish a national trust bank in the U.S. This will allow Circle to directly manage its reserves and provide cryptocurrency custody services to institutional clients. Could you please detail Circle's plans for this national trust bank?

Dante:Yes, custody and safeguarding services are part of our plans. Furthermore, with the implementation of the "GENIUS Act," U.S. non-bank stablecoin issuers must obtain a special purpose charter and a trust charter from the Office of the Comptroller of the Currency (OCC). Therefore, our move is clearly a strategic one to prepare for future regulatory requirements. This strategy is not surprising as it aligns with how we operate in the European market and under the Markets in Crypto-Assets (MiCA) framework.

Our business goal has always been to strive for excellence. When Europe spent years developing the MiCA framework, we realized that we needed to establish a presence in Europe. For this, we chose France and obtained an e-money license, ensuring that Circle's USDC and Euro stablecoins were among the first products to comply with MiCA regulations. Thus, as U.S. regulations evolve, adopting a similar approach is a logical step.

Laura: I also wanted to ask a question about competing with big banks. Fortune recently reported that JPMorgan Chase plans to charge fintech companies for using their data. Imagine a fintech company, such as Plaid, that is responsible for connecting Coinbase (your largest partner) to customers' banks. If that bank is JPMorgan Chase, the once free data interface may start to incur charges. Do you think this kind of change would hinder Circle's development? How would Circle respond to a similar banking fee situation?

Dante: This is indeed a complex issue, and it is currently difficult to predict the specific impact. However, one thing is clear, the legitimacy of currency use has been a contentious issue for many years, and this is also one of the reasons I have been involved in this industry. I have always believed that the right to use currency should be as free as possible.

Furthermore, the payment methods of the traditional banking system are similar to the landline telephone era, where the longer the call, the higher the cost. Therefore, many companies in the future may compete around data, viewing data as an asset. In this era where data is called the "new oil," can blockchain become the "new tool" to carry this data? This is a question worth pondering.

Why Financial Privacy Is So Important in the U.S. System

Dante: The U.S. society has a deep-rooted need for financial privacy, which is also a major reason for opposing Central Bank Digital Currency (CBDC). However, truly safeguarding financial privacy is not easy, and only by establishing clear rules and a fair competitive system can users be securely and privately provided with complete financial services. Cryptocurrency wallets play a crucial role in this process, providing users with secure tools to store and manage cryptocurrency while protecting personal privacy.

Currently, stablecoins are achieving this goal through the U.S. dollar, and mobile digital wallets, open-source wallets, and blockchain infrastructure collectively support this competitive system, enabling comprehensive coverage for every user. In a post-GENIUS Act world, consumers will have more choices and will be able to enjoy financial services while safeguarding their privacy. If some large institutions try to compete by monetizing data, the implementation of the GENIUS Act will provide consumers with alternative solutions, allowing them to preserve their privacy without compromise.

How are Deposit Tokens Different from Stablecoins

Laura: Recently, the topic of Deposit Token has started to receive attention, and I didn't understand this concept before. Each unit of a Deposit Token represents a part of a bank deposit. So, how does it differ from the use case of a Stablecoin? Does the Deposit Token have the potential for widespread application? In which scenarios might it be used? Is there a competitive relationship between it and Stablecoin, or are they simply different in usage? How should consumers view these two?

Dante: This question is indeed somewhat complex. As a supporter of the Central Bank Digital Currency (CBDC) opposition movement, I have conducted in-depth research on this and have used some academic papers to support my viewpoint. There is indeed some similarity between Deposit Tokens and Stablecoins. The "GENIUS Act" allows banks to issue payment stablecoins but stipulates that stablecoins issued by banks are the only legal products. The Act proposes some key requirements for the legislation of payment stablecoins.

If I were a board member of a large bank, I would pay attention to the following issues: First, the issuer cannot directly pay interest, which means this digital currency will not compete with traditional deposit-taking but is a fully-reserved form of digital currency. This also raises a question—If a failed bank (e.g., Credit Suisse) issues Deposit Tokens, would you accept them? Because if Deposit Tokens fail to comply with the requirements of the "GENIUS Act," they may become a digitized representation of a bank's balance sheet risk. This means that your right to redeem at face value for US dollars may be affected by factors such as loans, credit risk, maturity risk, etc., in a bank's balance sheet. Therefore, the "GENIUS Act" requires banks to issue stablecoins through a separate entity and a separate balance sheet to ensure their security.

Furthermore, the "GENIUS Act" has completely ended the era of those unreliable stablecoins of the past. For example, cases like Terra Luna are no longer tradable in the US market. If stablecoin issuers fail to prove the authenticity of their assets (i.e., through the "Jerry Maguire Test." Deep Tide TechFlow Note: This is a common metaphor used in the startup, investment, or product development field, originating from the classic movie "Jerry Maguire." The protagonist lost most of his clients because he stuck to his principles but eventually gained a loyal client. Here, the "Jerry Maguire Test" can be understood as a crucial step to validate market demand and early ecosystem support, which is an important indicator of whether a stablecoin can survive in a competitive blockchain ecosystem.), they may even face criminal penalties. The "GENIUS Act" imposes strict requirements on trust, transparency, and auditability and holds responsible individuals criminally liable. This ensures that the Crypto Dollar counterfeit will no longer appear under the guise of a Stablecoin and ultimately collapse.

Circle's Potential Actions When Interest-Bearing Stablecoins Are Eventually Approved

Laura: I understand that stablecoins themselves have a certain centralization aspect, but their situation is completely different from Terra Luna. However, I would like to discuss interest-bearing stablecoins. Obviously, current regulations do not allow the existence of such stablecoins, and this regulation does not fully serve consumers' interests. In some ways, this even seems somewhat contradictory, as this regulation was actually pushed by the Democratic Party. However, this is a positive development for Circle and similar companies. I understand that the law will not change in the short term, but in the future, when consumers realize that this regulation is not beneficial to them, it may drive policy adjustments. If the law allows for the emergence of interest-bearing stablecoins, Circle may need to compete to attract more customers, for example, by offering returns to consumers. Although this may not be your current focus, I think this situation may arise in the future.

Dante: We have indeed considered this issue. Let me share our perspective. The fully reserved stablecoin model addresses a core issue of early cryptocurrency—consumers' regret over price volatility. Bitcoin, due to its price volatility and appreciation, gradually lost its function as an exchange medium on the Internet and was defined as digital gold instead of an asset for daily consumption. For example, the "Bitcoin Pizza Day" event is a typical case that gave rise to the demand for fully reserved stable assets. This asset is not only the pricing mechanism for crypto transactions but also a crucial exchange medium for the Internet economy.

Currently, MiCA and the "GENIUS Act" both prohibit stablecoin issuers from directly paying returns to token holders, but we believe returns are a key feature of cryptocurrency. Through the secondary market, DeFi, and lending functionalities associated with programmable money, returns can be achieved. The "GENIUS Act" prohibits regulated issuers from directly paying returns, but returns, as an innovation of the secondary market, are a core feature of this field. Just like physical dollars create loans and credit on a bank's balance sheet, fully reserved stablecoins have also become a critical foundational layer of the Internet economy. Unlike traditional funds, consumers can enjoy other benefits of the funds, such as liquidity unaffected by bank holidays, programmability, composability, and DeFi flexibility. If the funds themselves are not fully reserved or carry risks, these advantages cannot be achieved. This is also why we support the "GENIUS Act" and MiCA, which have become the legal basis for stablecoins in Europe and America.

In addition, the United States also needs further regulatory oversight of the cryptocurrency market structure to address other issues in the market, such as how to define commodities, securities, and digital collectibles, as well as how to handle integrated economic activities spanning banking, payment regulation, and capital markets. I believe that innovation in the secondary market and the utility of stablecoins will usher in new development opportunities in this field.

Laura: I have a few more questions about Circle's recent IPO. The stock was trading at around $234 per share as of an hour ago, far above the IPO price of $31.

I am curious about the atmosphere within the company since the IPO because I think, at least in the cryptocurrency space, there may be a gap between pre-IPO expectations and actual results. Is this also your feeling, or has it been surprising for you?

Dante: Unfortunately, I cannot speak on behalf of the entire Circle regarding this question. I cannot say much about the stock price or the IPO itself, but becoming a public company has always been Circle's long-term goal. As a public company, we remain focused on the core principle of driving the company's development, which is long-term oriented. This is probably the most I can share.

However, I believe the current real news focus is on the "GENIUS Act." In fact, I am currently on my way to the White House to participate in a ceremonial signing of a law that I personally put a lot of effort into. This moment is not only beneficial to the company but also of great significance to the entire nation and market because we have finally obtained legal clarity in the United States.

How Might This New Law Impact Ordinary Americans and Their Finances

Laura: One last question. As we look ahead five years, how do you think this law will affect the lives of ordinary Americans, consumer rights, and the United States' global position?

Dante: I once wrote an article titled "When Blockchain is No Longer a Topic, How We Use It to Change the World." The publication of this article is also thanks to you, Laura Shin, then an editor at Forbes, who gave me this opportunity. I believe that the "GENIUS Act" and the forthcoming U.S. market structure regulatory law will gradually shift cryptocurrency and blockchain technology from visible applications to deeper infrastructure, and their impact will also become increasingly evident.

I hope that in the next five years, we will not only consolidate the US dollar's position as the core currency of the Internet economy and use it as a strategic advantage for the United States in global competition, but also enable more people to enjoy secure and reliable smart device-based financial services. These services not only include simple payment functions but also cover more complex financial activities such as savings, loans, credit, and provide consumers with greater convenience and benefits. Therefore, the United States has officially entered this field.

Just yesterday, I attended a global conference and had discussions with about forty to fifty representatives from international regulatory agencies and central banks. This is the first time in my seven years of working in this field that I can confidently say that the United States is developing a legal framework for the cryptocurrency and blockchain industry, no longer relying solely on the performance of the private sector to represent the country.

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