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The GENIUS Act Leads the Stablecoin Revolution, Digital Assets Enter a New Era
Stablecoin Revolution: The "GENIUS Act" Opens a New Era for Digital Assets
The year 2025 is regarded as the "Year of Stablecoins," with dollar-backed digital assets becoming the focus, even receiving recognition from the highest levels. In March of this year, a DeFi platform launched the world's free stablecoin USD1. In May, the Vice President spoke at a Bitcoin conference, clarifying the government's positive stance on stablecoins, believing they could become a "force multiplier for the strength of the American economy."
Subsequently, a stablecoin issuer completed a $20 billion IPO, triggering the "Summer of Stablecoins". Last week, the "GENIUS Act" was officially signed into law, becoming the first legislation in the U.S. to directly regulate digital assets, marking a turning point for global finance.
Even a well-known banker who personally harbors skepticism towards cryptocurrency has joined this initiative. Although he has publicly stated that he does not understand the appeal of cryptocurrency, there is already a gap between his words and actions: this largest American bank has long been a pioneer in blockchain technology and has been developing its own stablecoin since 2019.
Analysis of the GENIUS Act
The full name of the "GENIUS Act" is "2025 U.S. Stablecoin Innovation and Establishment Act". This is the first federal law in the United States to comprehensively regulate "payment stablecoins". The Act establishes a long-awaited licensing and regulatory framework for stablecoin issuers, requiring stablecoins to be backed by 1:1 full reserves, implementing strict consumer protection measures, and laying a clear legal foundation for the integration of stablecoins into the mainstream financial system.
The law also prohibits non-financial enterprises from issuing stablecoins without special approval, imposing severe penalties for violations. Offenders may face daily fines of up to $200,000, with criminal penalties including up to 5 years imprisonment.
A founder of a crypto investment fund stated: "The 'GENIUS Act' is not only a significant advancement in the field of cryptocurrency but also an important step for the United States' leadership in the global financial arena. For the first time, we have established clear rules for stablecoins, which are at the core of open, programmable currency infrastructure."
The Perfect Storm of Digital Assets
The introduction of the "GENIUS Act" is not an isolated event. The current government's support for digital assets is surging, with a comprehensive upgrade in full swing. The gradual lifting of the suppression on cryptocurrencies during Biden's administration, along with the repeal of restrictive legislation such as the prohibition of U.S. banks providing custody services for digital assets, has collectively created a perfect storm.
The chief technology officer of a certain developer platform stated: "We have seen large banks that previously held a cautious attitude immediately show interest. Now, with the implementation of the GENIUS Act, we believe that all large banks will issue or support stablecoins in some form. This will usher in a new era of programmable currency, which is trustworthy, regulated, and designed for the speed of the internet scale."
The bill will also strengthen the dominance of the dollar, promote dollar-based innovation, and consolidate the dollar's status as the global reserve currency for decades to come.
Stablecoin "killer applications" emerge
The uses of stablecoins have far exceeded the initial "wealth storage tool to avoid the volatility of digital assets such as Bitcoin and Ethereum" and are now recognized as key financial infrastructure by milestone legislation. In the coming years, we can expect true innovations, including instant remittances, AI-native payments, and intermediary-free global trade.
A major bank made headlines this week for allowing customers to use Bitcoin as collateral for loans. Thanks to the GENIUS Act, the bank is developing a new program that allows customers to pledge Bitcoin or Ethereum to obtain cash loans, similar to the model of using stocks or real estate as collateral.
Tokenization technology has become a core focus for traditional financial giants, as it significantly optimizes the current financial standard system while greatly enhancing liquidity accessibility. With the help of blockchain technology, tokenization breaks geographic limitations, allowing limited and fragmented markets to be integrated, providing real-time access to multi-source liquidity around the clock globally.
The Possibility of "Super DeFi Summer"
One interesting provision in the "GENIUS Act" is the prohibition on paying interest or returns to stablecoin holders, which could trigger a surge in demand for DeFi yield opportunities. If the Treasury's predictions are correct, trillions of dollars in stablecoins will enter the market, and as users maximize returns through various yield strategies, we will witness a "Super DeFi Summer."
The stablecoin market is entering a new phase, where only institutions that can efficiently utilize capital will survive. However, there is a bottleneck: stablecoins can operate 24/7, while government bonds cannot. Bridging this gap in liquidity infrastructure has now become a core priority.
Political Impact Analysis
Despite the increasing prominence of digital assets as a partisan issue, and with some core Democrats still leading the anti-crypto camp, the momentum for cryptocurrency adoption seems to have transcended political divides. Large banks, asset management firms, and payment companies are all positioning themselves in the blockchain space, as it offers superior technology for settlement and programmable currency.
The key is that institutions are building real utility on the blockchain, and these application scenarios solve real problems such as settlement speed, operational costs, and 24/7 availability, which is the driving force for sustained adoption.
In the face of global debt expansion, liquidity expansion, geopolitical uncertainty, and declining interest rates, the United States' friendly regulation of digital assets may mean "this train is unstoppable." We are entering a rare window period where fundamentals, liquidity, and macro dynamics are all improving, and this is precisely the moment to unlock the maximum upside potential.