Key Highlights
- Stablecoin issuers are seeking a clear federal path as the GENIUS Act rulebook moves toward implementation.
- Banks and crypto firms are clashing over rewards, deposit competition and access to the federal banking perimeter.
- Exchanges, compliance firms and payment companies are preparing for rules that could reshape listings, wallet controls and stablecoin payment infrastructure.
Last summer, as the afternoon sun cut across the Rose Garden, President Donald J. Trump sat at a heavy mahogany desk surrounded by a crowded circle of payment network CEOs, cryptographic software founders, and bipartisan lawmakers. Stamped with the signature of the 119th Congress, S. 1582—the Guiding and Establishing National Innovation for U.S. Stablecoins Act, or the “GENIUS Act”—was signed into law. It was a moment of typical political theater, complete with the President joking that the bill had been named after him. But beneath the celebratory surface, a high-stakes corporate scramble was already underway.
The GENIUS Act, in its unassuming, highly technical way, was a blinking red light for the global financial order. By replacing a fragmented patchwork of state guidance with a unified, enforceable federal regulatory regime, the law effectively legalized private digital currency in the United States. But it also started a clock. Within three years, a strict “DASP Mandate” would make it unlawful for any digital asset exchange or service provider to offer stablecoins to Americans unless they were issued by a federally approved Permitted Payment Stablecoin Issuer (PPSI).
The first part of this series examined the July 18 deadline and the unfinished state of the rulebook. The second traced how Washington divided the work across Treasury, OCC, FDIC, FinCEN, OFAC, NCUA and the Federal Reserve.
This third part turns to the companies around the rulebook: The transition has unleashed a quiet war across Wall Street, Silicon Valley, and Capitol Hill. Behind closed doors, legacy banks, fintech titans, and offshore crypto giants are racing to secure their share of a market, which is projected to reach up to $3.7 trillion by the end of the decade.
Tether Builds a U.S. Product Around USAT
Tether moved before the final rulebook was finished.
The issuer of USDT announced USAT, a separate dollar stablecoin aimed at the U.S. market. The company did not present the token as a replacement for USDT, which remains the dominant stablecoin across global crypto trading.
USAT was designed as a domestic product for American users. Anchorage Digital Bank was expected to issue the token, while Cantor Fitzgerald was expected to manage reserves. Bo Hines, a former White House digital assets adviser, was brought in to lead Tether’s U.S. effort.
The plan separated Tether’s global stablecoin business from its U.S. regulatory strategy. USDT would remain the offshore liquidity product. USAT would give Tether a token built around the American framework.
Foreign issuers face one of the most sensitive questions under the GENIUS Act: how they can continue serving U.S. users once final rules define registration, reserve and reporting standards.
Tether chose to build a U.S.-specific structure before those rules were complete. If USAT becomes its compliant American product, the company could challenge USDC inside the regulated market while keeping USDT’s role across offshore trading venues.
Circle’s Regulated-Dollar Strategy Gets a Federal Test
Circle entered the final stretch of GENIUS Act rulemaking with USDC already positioned as a regulated dollar stablecoin.
The company’s business is built around the same areas the rulebook is expected to govern: reserve quality, redemption, custody, disclosures and institutional access. Its latest financials showed the commercial scale behind that model. USDC circulation rose 72% year over year to $75.3 billion in the fourth quarter. Reserve income rose to $733 million, helping lift total revenue to $770 million.
Jeremy Allaire, Circle’s co-founder and chief executive, has framed stablecoins as part of global payment and currency infrastructure. In public comments, he described stablecoins as tools that could help currencies move across global payment networks, including possible yuan- and Hong Kong dollar-backed tokens as digital money moves further into trade and settlement.
Circle has also moved closer to the federal banking perimeter. The company received conditional approval tied to a national trust bank charter, a route that would place it under federal supervision without turning it into a traditional deposit-taking bank.
That route could strengthen Circle’s position if final GENIUS Act rules favor large issuers with strong reserve systems, compliance teams and institutional distribution. It could also raise the threshold for smaller issuers that do not have the same scale or reserve income.
Ripple Mboves Toward the Banking Perimeter
Ripple has taken a more direct path toward banking access.
The company applied for a U.S. national bank charter and pursued a Federal Reserve master account through its custody subsidiary. The effort placed Ripple’s RLUSD stablecoin strategy closer to traditional financial infrastructure.
A national charter would bring Ripple under the Office of the Comptroller of the Currency. A Fed master account would give its subsidiary access to Federal Reserve payment infrastructure and allow it to hold stablecoin reserves directly with the central bank.
RLUSD remains far smaller than USDT and USDC, but Ripple has positioned the token around payments and settlement rather than only exchange liquidity. CryptoTimes has separately covered Ripple’s push to place RLUSD stablecoin into cross-border payments.
The banking application followed that strategy. Stablecoins built for payments need banking relationships, reserve access, compliance systems and reliable redemption.
The OCC later conditionally approved national trust bank charters for several crypto-related firms, including Circle and Ripple. Traditional banks opposed the approvals, arguing that crypto firms were entering the banking perimeter through a lighter route.
Ripple CEO Brad Garlinghouse publicly criticized the banking lobby after the approvals, calling the move a major step forward and accusing banks of anti-competitive tactics.
Coinbase Draws Banks Into the Rewards Fight
Coinbase’s fight is over rewards.
The GENIUS Act restricts payment stablecoin issuers from paying interest or yield solely for holding stablecoins. The next dispute moved to exchanges, wallets and intermediaries that may offer rewards, rebates or incentives tied to stablecoin balances or platform activity.
Coinbase wants room for those programs. Banks want tighter limits.
The issue has already surfaced in the wider CLARITY Act debate over stablecoin reward rules and agency oversight. A Senate compromise reportedly sought to restrict yield-like payments while preserving rewards tied to specific platform activity.
Coinbase policy chief Faryar Shirzad publicly described the compromise as preserving rewards based on real use of crypto platforms and networks. Brian Armstrong backed movement on the bill.
Banks have treated the same structure as a deposit threat. JPMorgan CEO Jamie Dimon publicly criticized Coinbase’s position and said banks would oppose legislation they believed allowed crypto firms to offer deposit-like products without equivalent bank regulation.
Banking groups have warned that stablecoin rewards could draw deposits away from lenders, especially community banks. Crypto firms have argued that platform rewards tied to activity are not the same as interest on bank deposits.
The dispute has already moved markets. Reports about possible restrictions on stablecoin interest or rewards pressured Circle and Coinbase shares earlier this year, reflecting how closely investor expectations are tied to stablecoin distribution and user incentives.
The rewards fight now sits beside broader banking industry concerns over stablecoins, where traditional lenders are trying to limit how far crypto firms can move into bank-like products.
Exchanges Wait for the Foreign Issuer Rules
Exchanges are waiting for the rulebook to settle another issue: which stablecoins can safely remain in front of U.S. users.
Stablecoins sit beneath much of crypto trading. They are used in spot pairs, collateral, settlement, treasury balances and transfers between platforms. A change in the regulatory status of USDT, USDC, RLUSD or other dollar tokens could force platforms to adjust listings, disclosures and custody procedures.
Foreign issuer rules will be watched closely. A U.S. exchange may treat a domestic GENIUS-compliant stablecoin differently from a foreign-issued token that has not registered or does not meet equivalent standards.
Tether’s USDT-USAT split sharpens that problem. If USAT becomes Tether’s compliant U.S. product, platforms may have to decide how much exposure they can continue to offer U.S. customers through USDT.
Identity rules add another layer. Regulators have already moved on customer-identification requirements for permitted payment stablecoin issuers.
Exchanges already run KYC programs, but stablecoins can move far beyond exchange accounts after issuance. Tokens can pass through wallets, custodians, DeFi protocols and cross-chain bridges. The final rules will shape how much responsibility lands on issuers, platforms, wallet providers and intermediaries.
Compliance Firms Move Into the Stablecoin Stack
Compliance firms are moving deeper into the stablecoin market.
FinCEN and OFAC have pushed the framework toward anti-money laundering controls, sanctions screening and customer-identification programs. Those obligations sit away from the public fight over rewards, but they could shape how stablecoins move once issued.
Traditional AML systems were built around financial institutions that directly know their customers. Stablecoins move through a wider network. A token can be issued by one company, traded on an exchange, transferred to a self-custody wallet, bridged to another chain and used inside a protocol.
That path has created demand for blockchain intelligence firms, custody providers, wallet infrastructure companies and transaction-monitoring tools.
Sanctions cases have already shown how stablecoins can become part of enforcement disputes. CryptoTimes has covered stablecoin sanctions enforcement in cases involving illicit finance networks and digital asset flows.
Under the final GENIUS Act framework, compliance will move further into issuance, custody, distribution and platform access.
Payment Firms Look Past Trading
Stablecoins are moving beyond exchange balances.
Payment firms, fintechs and settlement providers are watching the GENIUS Act because regulated stablecoins could become part of cross-border transfers, merchant payments, treasury management and tokenized finance.
Reuters has framed the larger stablecoin opportunity as the infrastructure around the tokens: wallets, payment processors, custody systems, on- and off-ramps and compliance tools.
The same shift is visible across the market. Circle is pushing USDC as payment infrastructure. Ripple is building RLUSD into cross-border settlement. Tether is preparing a U.S. token for a regulated market. Exchanges are trying to preserve user incentives around stablecoin balances.
Stablecoins built for payments require more than a token contract. They need banking relationships, reserve access, redemption systems, fraud controls, liquidity and compliance tools.
The GENIUS Act could bring those systems closer to institutions. It could also narrow the field to firms able to build and maintain regulated financial infrastructure at scale.
State-Regulated Issuers Try to Hold Their Ground
State-regulated issuers are still fighting for a place in the new framework.
The GENIUS Act preserves a state path for smaller issuers if state regimes are considered “substantially similar” to the federal framework. Treasury’s interpretation of that phrase will determine how much room state-supervised firms keep once federal rules are complete.
State trust companies and smaller issuers have different incentives from large national players. A federal path offers national credibility and scale. A state path offers speed, familiarity and regulators that already understand parts of the digital asset market.
New York and other state regimes had already shaped the first phase of U.S. stablecoin oversight before Congress passed a federal law. The final Treasury rule will decide whether that history continues as a serious alternative or becomes secondary to federal supervision.
A narrow reading of “substantially similar” would push more firms toward federal approval. A more flexible reading would preserve state supervision as a viable path for smaller issuers.
A Rulebook Already Reshaping Business Plans
Major industry players have already chosen positions before the final rulebook is complete.
Tether has built a U.S. route around USAT. Circle has leaned further into the regulated-dollar model. Ripple has moved toward a national bank charter and Federal Reserve access. Coinbase has fought over rewards. Banks have pushed back against stablecoin balances that could behave like deposits. Compliance firms are preparing for a market in which monitoring and identity controls sit inside the stablecoin stack.
The final version will decide more than which companies can issue stablecoins. It will shape the business models around them: offshore liquidity, regulated dollar infrastructure, bank-linked settlement, exchange rewards, payment plumbing, state-regulated issuance and compliance rails.
The GENIUS Act gave Washington the job of writing America’s stablecoin rules.
The largest companies in the market are already preparing for the version most likely to favor their model.
Also Read: Bankers Press Senate on Stablecoin Yield Ahead of CLARITY Act Vote
