Original Title: "Stablecoin Bill GENIUS Act Passes Vote, Which Cryptocurrencies Will Benefit?"

Original Source: DeepTech TechFlow

Once again, the mood in the crypto market is focused on regulatory action.

On May 19, the U.S. Senate passed a procedural vote on the GENIUS Act (the "2025 Guiding and Establishing National Innovation for U.S. Stablecoins Act") by a vote of 66-32, marking a milestone in the imminent establishment of the U.S. stablecoin regulatory framework.

As the first comprehensive federal stablecoin regulatory bill in the U.S., the rapid advancement of the GENIUS Act has sparked enthusiastic responses in the crypto market, with the DeFi and RWA sectors related to stablecoins leading today's market.

Will the GENIUS Act become a catalyst for a new bull market?

According to Citibank's forecast, the global stablecoin market is expected to reach $1.6 to $3.7 trillion by 2030. The passage of the bill provides more compliance and development space for stablecoins, giving traditional companies a more reasonable entry point.

The market is also anticipating that the influx of incremental funds will bring a "flood effect," injecting new liquidity into related crypto assets.

But before that, you should at least understand what the contents of this bill are and the legislative intent behind it in order to provide more compelling reasons for selecting relevant crypto assets.

From "Wild Growth" to Standardization

The GENIUS Act, translated literally as the "Genius Act," is actually an abbreviation for the "2025 Guiding and Establishing National Innovation for U.S. Stablecoins Act of 2025."

In simpler terms, it's the blockbuster legislation of the United States.

The reason the market is paying attention is that it is the first comprehensive federal regulatory bill for stablecoins in U.S. history. Before this, stablecoins and cryptocurrencies have always been in a delicate gray area:

The law prohibits what can be done, but it doesn't provide clear rules on "how to do it."

The goal of the GENIUS Act is to provide legitimacy and safety to the stablecoin market through a clear regulatory framework, while also consolidating the US dollar's dominant position in digital finance.

In summary, the key contents of the bill include:

· Reserve Requirements: Stablecoin issuers must have 100% reserve backing, with reserve assets in US dollars, short-term US Treasury securities, and other highly liquid assets, and must publicly disclose the reserve composition monthly.

· Regulatory Tiers: Large issuers with a market cap exceeding $100 billion (such as Tether and Circle) must be directly regulated by the Federal Reserve System or the Office of the Comptroller of the Currency (OCC), while small issuers can be regulated by state authorities.

· Transparency and Compliance: Prohibition of misleading marketing (such as claiming the stablecoin is backed by the US government) and requirements for issuers to comply with Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations. Issuers with a market cap over $500 billion must undergo annual audits of financial statements to ensure transparency.

This also means that the US's stance on stablecoins is actually friendly, but the prerequisite is that stablecoins must be pegged to the US dollar and meet transparency requirements.

Looking back at history, the inception of the GENIUS Act was not an overnight success but a culmination of the US's exploration of stablecoin regulations over many years. We have also quickly outlined the full timeline of this bill to help you quickly understand the background and motivation of the legislation:

The stablecoin market has rapidly expanded, but the risks arising from regulatory gaps have become increasingly prominent, as seen in events like the 2022 collapse of the algorithmic stablecoin UST, highlighting the need for clear regulation.

As early as 2023, the House Financial Services Committee proposed the STABLE Act in an attempt to establish a regulatory framework for stablecoins, but due to bipartisan disagreements, it did not pass in the Senate;

On February 4, 2025, Senator Bill Hagerty, together with bipartisan lawmakers such as Kirsten Gillibrand and Cynthia Lummis, formally introduced the GENIUS Act, aiming to balance innovation and regulation. On March 13, the bill was passed by an 18-6 vote in the Senate Banking Committee, showing strong bipartisan support.

However, the initial full Senate vote on May 8 failed to reach the 60-vote threshold (48-49), with some Democratic senators (such as Elizabeth Warren) expressing concerns that the bill might benefit crypto projects associated with the Trump family (such as the USD1 stablecoin), citing potential conflicts of interest.

After revisions, the bill included additional restrictions on big tech companies, alleviating some lawmakers' concerns about conflicts of interest. The bill ultimately passed on May 19 with a 66-32 vote in a procedural vote and is expected to soon proceed to a simple majority full Senate vote.

So, what is the significance of the legislation reaching this stage?

Firstly, the market craves certainty. The bill's passage essentially signals the U.S. stablecoin market's shift from a period of "wild growth" towards normalization, filling a longstanding regulatory gap and providing certainty to the market.

Secondly, it is a clear signal to solidify the dollar's position through stablecoins, especially amidst competition from the Chinese digital yuan and the EU's MiCA regulation.

Lastly, the advancement of the GENIUS Act may pave the way for broader cryptocurrency market legislation (such as market structure bills), driving the convergence of the crypto industry with traditional finance, laying the legal groundwork for the mainstreaming you've all been waiting for.

Interest-Involved Cryptocurrencies

The core provisions of the GENIUS Act directly impact the stablecoin ecosystem and, through a ripple effect, affect the entire crypto market. This regulatory framework will not only reshape the stablecoin industry but will also influence various crypto tracks such as DeFi, Layer 1 blockchains, and RWAs through the widespread use of stablecoins.

However, some projects in these tracks may not fully meet the regulatory requirements of the bill. To perceive the bill as a positive development, adjustments will need to be made in product design and operations.

We have compiled some significant projects and outlined their benefits and adjustment points as follows.

Centralized Stablecoin Issuers:

The bill's reserve requirements (100% liquid assets, holding U.S. treasuries) and transparency mandates (such as monthly disclosures) are most favorable to centralized stablecoins. These stablecoins are already in line with the requirements, and the clear regulations are expected to attract more institutional funds, expanding their utility in the trading and payments space.

$USDT (Tether): USDT is the largest stablecoin by market capitalization (approximately $130 billion in 2025), with its reserves consisting of around 60% U.S. short-term treasuries (approximately $78 billion) and 40% cash and cash equivalents (data source: Tether's Q1 2025 transparency report).

The GENIUS Act requires reserve assets to be mainly held in US Treasuries, a requirement that Tether has fully complied with, and its transparency measures (such as quarterly audits) also meet the bill's requirements. However, the key point is that USDT's usage has always had a gray market aspect (such as telecom fraud), so how to adjust the business to comply with regulations is the next issue to consider.

$USDC (Circle): The USDC has a market capitalization of around $600 billion, with 80% of its reserves composed of short-term US Treasuries (about $480 billion) and 20% in cash (source: Circle May 2025 monthly report). Circle is already registered in the US and actively cooperates with regulations (like applying for an IPO in 2024), and its reserves fully comply with the bill's requirements. The bill's passage may make USDC the preferred stablecoin for institutions, especially in the DeFi sector (by 2025, USDC's share in DeFi has reached 30%), with further market share growth expected.

Decentralized Stablecoins:

$MKR (MakerDAO, issuer of DAI): DAI is the largest decentralized stablecoin (with a market cap of about $90 billion), issued through overcollateralized crypto assets (such as ETH), with approximately 10% of its reserves in US Treasuries (about $9 billion), primarily collateralized by crypto assets (source: MakerDAO May 2025 report).

The stringent reserve asset requirements of the GENIUS Act may pose a challenge to DAI, but if MakerDAO increases the proportion of US Treasury reserves, it could benefit from overall market growth. $MKR holders may profit from the increased use of DAI (MakerDAO's annual protocol revenue in 2025 is approximately $200 million).

$FXS (Frax Finance, issuer of FRAX): FRAX has a market capitalization of around $20 billion, adopts a partially algorithmic mechanism (50% collateralized, 50% algorithmic), with about 15% of its collateral assets in US Treasuries (about $3 billion). If Frax adjusts to a fully collateralized model and increases the proportion of US Treasuries, it could benefit from market expansion, but its algorithmic mechanism may face regulatory pressure since the bill does not protect algorithmic stablecoins.

$ENA (Ethena Labs, issuer of USDe): USDe has a market capitalization of around $1.4 billion, issued through ETH hedging and yield strategies, with only 5% of its reserves in US Treasuries (about $70 million).

Their strategy may need significant adjustment to comply with the bill requirements, and if successful, they could benefit from market growth, but there are risks involved.

DeFi Trading/Lending

$CRV (Curve Finance): Curve focuses on stablecoin trading (2025 TVL around $20 billion), with 70% of its liquidity pool consisting of stablecoin pairs (such as USDT/USDC).

The increased stablecoin usage driven by the GENIUS Act will directly boost Curve's trading volume (current daily average volume around $3 billion). $CRV holders can benefit from transaction fees (approximately 5% annualized return) and governance rights. If the stablecoin market grows as Citigroup predicts, Curve's TVL could also increase by another 20%.

$UNI (Uniswap): Uniswap is a general DEX (2025 TVL around $50 billion), with stablecoin pairs (such as USDC/ETH) representing 30% of its liquidity. The increased stablecoin trading activity due to the bill will indirectly benefit Uniswap, but to a lesser extent than Curve (due to more diversified business). $UNI holders can benefit from trading fees (approximately 3% annualized).

$AAVE (Aave): Aave is the largest lending protocol (2025 TVL around $100 billion), with stablecoins (such as USDC, DAI) accounting for about 40% of its lending pool.

The bill is expected to attract more users to borrow using stablecoins (e.g., collateralizing USDC to borrow ETH), potentially further increasing Aave's deposits and borrowing volume (based on current trends). $AAVE holders benefit from protocol revenues (estimated annual revenue of around $1.5 billion in 2025) and token appreciation.

$COMP (Compound): Compound has a TVL of around $30 billion, with stablecoin borrowing accounting for about 35%. Similar to Aave, the increase in stablecoin lending will benefit Compound. However, its market share and innovation speed are lower than Aave, so the potential upside for $COMP may be relatively smaller.

Yield Protocol

$PENDLE (Pendle): Pendle focuses on yield tokenization (2025 TVL around $5 billion), with stablecoins commonly used in its yield strategies (such as the USDC yield pool, currently offering an annualized return of around 3%). The bill-driven growth in the stablecoin market will increase Pendle's yield opportunities (e.g., yield rates may rise to 5%), and $PENDLE holders might benefit from protocol revenue growth (estimated annual revenue of around $30 million in 2025).

Layer1

$ETH (Ethereum): Ethereum hosts 90% of stablecoin and DeFi activities (DeFi TVL exceeding $100 billion by 2025). An increase in stablecoin usage driven by regulations will boost Ethereum's on-chain transaction volume (current annual Gas fee revenue is approximately $2 billion), and the value of $ETH may rise due to increased demand.

$TRX (Tron): Tron is a significant network for stablecoin circulation, with public data indicating a circulating supply of USDT on Tron's chain of around $60 billion by 2025, constituting 46% of the total USDT supply; an increase in stablecoin usage driven by regulations may enhance on-chain activities on Tron.

$SOL (Solana): Solana has become a key platform for stablecoins and DeFi due to its high throughput and low cost (TVL around $8 billion by 2025, with a circulating supply of USDC on-chain of around $5 billion). An increase in stablecoin usage will drive Solana's DeFi activities (current daily transaction volume is around $1 billion), and $SOL may benefit from increased on-chain activity.

$SUI (Sui): Sui is an emerging Layer 1 solution (TVL around $1 billion by 2025) that supports stablecoin-related applications (such as Thala's stablecoins and DEX). Growth in the stablecoin ecosystem due to regulations will attract more projects to deploy on Sui, and $SUI may benefit from the increased ecosystem activity (current daily active users are around 500,000).

$APT (Aptos): Aptos is also an emerging Layer 1 solution (TVL around $800 million by 2025) with an ecosystem supporting stablecoin payments. An increase in stablecoin circulation will drive Aptos' payment and DeFi applications, and $APT may benefit from user growth.

Payments Track

$XRP (Ripple): XRP focuses on cross-border payments (with a daily transaction volume of around $2 billion by 2025), and its low cost and high efficiency can complement stablecoins. An increase in stablecoin cross-border payment demand driven by regulations (such as the use of USDC for international settlements) will indirectly enhance XRP's use cases (e.g., as a bridge currency), and $XRP may benefit from the growth in payment demand.

$XLM (Stellar): Stellar also focuses on cross-border payments (with a daily average transaction volume of about $500 million in 2025) and has collaborated with IBM to launch the World Wire project, using stablecoins as bridge assets.

Oracle

$LINK + $PYTH: Oracles provide price data for stablecoins and DeFi. The expansion of the stablecoin market driven by legislation will increase DeFi's demand for real-time price data, potentially leading to increased on-chain data queries.

However, this is more like an extension of sector-specific positive logic rather than a direct strong correlation.

RWA

$ONDO (Ondo Finance): Focuses on tokenizing fixed-income assets such as US Treasuries. Its flagship product USDY (a stable income token backed by US Treasuries) has been issued on chains like Solana and Ethereum (with a circulation of about $500 million USDY in 2025). The GENIUS Act requires stablecoins to hold US Treasuries as reserves, directly benefiting Ondo's US Treasury tokenization business. USDY may become one of the preferred reserve assets for stablecoin issuers. In addition, the circulation increase of stablecoins will drive retail and institutional investors to purchase USDY through USDC. The demand for Ondo's asset tokenization may grow, benefiting $ONDO holders.

The Dollar, a Grander Scheme

The US pushing stablecoin legislation can also be seen as a "scheme."

On one hand, the US aims for a weaker dollar policy to increase exports; on the other hand, it does not want to relinquish the dollar's global currency status.

By supporting stablecoin development, the US has, in a digital form, extended the global influence of the dollar without increasing the Fed's liabilities – currently, 99% of stablecoins are pegged to the dollar.

Simultaneously, regulatory requirements mandating stablecoins to hold US short-term Treasury bonds as reserves have cleverly found new buyers for US Treasuries, as evidenced by Tether's holdings of US Treasuries surpassing those of many developed countries.

This policy maintains the dollar's global dominance while finding reliable buyers for the substantial US debt, hitting two birds with one stone.

The passage of the GENIUS Act is undoubtedly a milestone for the crypto market. By tethering stablecoins to US Treasuries, it has paved a new path for the continued dominance of the dollar and has driven comprehensive prosperity in the crypto ecosystem.

However, this "master plan" is also a double-edged sword—while bringing opportunities, its high dependence on U.S. Treasury bonds, potential suppression of DeFi innovation, and the uncertainty of global competition could all become future hidden risks.

Nevertheless, uncertainty is always the stepping stone for the crypto market to advance.

Risks may be uncertain, but all participants are waiting for the certainty of a bull market.

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