The Genius of the GENIUS Act

When the US Senate Banking Committee approved the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act on March 13, it overwhelmingly voted to move forward with issuing and regulating stablecoins. With the bill poised to pass a full Senate vote and be signed into law by President Trump, payment stablecoin is likely to become a reality in the United States sooner rather than later.

The GENIUS Act is a multi-pronged piece of legislation that seeks to regulate and set terms for how the Federal government oversees stablecoin issuances. It defines who can issue payment stablecoins and what the requirements are for becoming a permitted payment stablecoin issuer. The GENIUS Act will incentivize payment stablecoin issuers to seek the appropriate permits but also define the terms under which non-US and unlicensed issuers must operate, creating a standardized market for stablecoins in the United States.

It is important to examine what this could mean for the economy in practical terms, as well as what a lack of common-sense legislation has meant for the cryptocurrency market in the United States to date.

See, Change!

Mainstream regulatory opinion is shifting when it comes to crypto and stablecoin, and the GENIUS Act is just one example of this change. This is a good sign, because the crypto space faced ongoing uncertainty over whether the entire market was legal or not. This ongoing lack of clarity created troubling uncertainty about how to build a client base — and it also creates a knock-on effect that slows business. Until the appropriate securities laws are in place, lingering gray areas make it difficult to build digital assets and for attorneys to ensure everything is aboveboard. For many, risk mitigation meant holding off entirely on potentially lucrative investments.

Disincentivizing Innovation

If innovators are worried about the regulatory climate, progress will naturally slow as it becomes harder to build new solutions. As a result, we’ve seen fewer exciting financial products, and those that do emerge usually take longer to come to market. That's why many of the leading lights in the global crypto space skip the United States entirely and build their companies elsewhere.

At Manifest, we favor a hybrid approach where we obey US securities laws but continue to issue offerings in South Korea, Dubai, Brazil, and other markets. Ideally, businesses in our industry could avoid this inconvenient structure and do everything either offshore or in the United States, but the lack of clarity to date has made that impossible. To be blunt, it made trying to succeed in the US a doomed proposition until a clear and reasonable legal structure was in place. The GENIUS ACT could be the door to reverse this trend.

Regulation and policy

More than anything, the GENIUS Act is a sign that the tide is changing toward more favorable policies. Which means it is time to examine the impact of a friendly regulatory regime for tokenized assets.

For example, inflation remains a major concern for anyone in business today. Many thought leaders are suggesting a combination of gold, bitcoin, and real estate to balance a portfolio and hedge against market drops as inflation is still not fully under control and tariffs threaten increasing volatility. If regulations allow for stablecoin-based tokenized real estate trading, a blockchain-driven asset like $USH offers the best of multiple categories for shoring up one’s holdings.

A GENIUS Move

The GENIUS Act putting guardrails around the industry is a 100% positive move that will end ongoing uncertainty and open US markets to incredible earning potential. Because the US is now on Team Crypto, we’re seeing common-sense rules that are keeping the bad actors out. More importantly, knowing the rules makes it possible to build useful and lucrative assets. Right now, the side that likes crypto hasn’t gone too far in creating permissive legislation, and it’s important to take advantage of what should be a healthy market.

Leading financial organizations like Goldman Sachs, Bayview, and JP Morgan-Chase all have exploratory Web3 teams, though some are more serious than others. Many operators are creating proof-of-concepts of potential offerings on public blockchains. But so far, we have not seen proper capital flows moving on-chain from traditional financial institutions, because until the GENIUS Act is on the books, there is no regulatory framework in which to safely operate.

Assuming the legislation passes, we can all look forward to unlocking major flows of institutional capital in the US. Companies will enjoy all the benefits of blockchain from the past decade, including increased efficiency, lower borrowing costs, and fewer errors having a strong positive impact on the market. The average person won’t know the difference, but a lot of the benefit will work its way down to consumers. Ultimately, the more the government works to enact common-sense legislation, the safer, more stable, and more lucrative for everyone the crypto market will be.

Nathaniel is co-founder and CEO of Manifest, a blockchain protocol that makes American assets crypto-compatible, starting with real estate. Previously, he co-founded the Series C mortgage fintech Roostify, which powered $600B / year in mortgages for major financial institutions like Chase and HSBC.