David Sacks, the White House’s top crypto and AI advisor, is optimistic about the potential of the stablecoin bill currently moving through the Senate. Speaking at CNBC’s Closing Bell Overtime, Sacks emphasized the bill’s ability to create massive demand for U.S. Treasurys, which could boost the economy significantly.
We already have over $200 billion in stablecoins – but it’s all unregulated, Sacks explained.
By providing legal clarity and a regulatory framework, we could potentially unlock trillions of dollars in demand for U.S. Treasuries almost overnight.
This push for stablecoin regulations centers around the GENIUS Act, which is now gaining momentum after a crucial procedural vote in the Senate. With 15 Democratic senators backing the bill, proponents believe the legislation is well-positioned to pass without facing a filibuster.
Sacks is confident the bill will pass and sees it as a breakthrough not just for the cryptocurrency world but as a broader national economic strategy. He framed the legislation as key to modernizing the U.S. payment system.Â
Stablecoin offers a more efficient, cost-effective, and smoother payment system, he said. This is a whole new set of payment rails for the U.S. economy, and it strengthens the dollar’s dominance in the digital age.
However, not everyone is sold on the GENIUS Act. There are concerns, particularly among Democrats, about potential conflicts of interest given President Trump’s personal cryptocurrency ventures. Some fear the legislation could benefit Trump and his family’s crypto businesses, including their involvement in meme coins and a new stablecoin linked to their financial firm.
Unlike cryptos like Bitcoin, stablecoins link to real objects, for example, the U.S. dollar, which makes them more predictable. Tether heads the stablecoin industry, making up roughly 60% of the market, while Deutsche Bank says stablecoin transactions were over $28 trillion in 2022, surpassing both Visa and Mastercard.
Though he sold his crypto assets as part of the White House requirements, the Trump family is furthering its grip on cryptocurrency. World Liberty Financial, which they fund, just released USD1, a stablecoin backed by both U.S. Treasuries and dollars held in deposits.
Abu Dhabi’s MGX investment which recently invested $2 billion into Binance, marking the biggest crypto funding the exchange has seen.
The bill may or may not make it through, despite the support it has received. Senator Hawley (R-Mo..) added a troubling rider that could make the issue more challenging. Some see the late fee cap that US Senator Tammy Baldwin is asking for as a measure that could drive away important banking supporters and cause the bill to be delayed.
Though there is a positive outlook, there are still many problems ahead because the crypto sector and the American government are divided over how to regulate stablecoins.
Also Read: US Senate Passes Stablecoin Bill ‘GENIUS Act’ for Amendment
