Recently, the recent passage of the U.S. Genius Act was widely celebrated, an important step in adopting Stablecoin, but a key provision could curb the attractiveness of the digital dollar compared to money market funds, raising questions about whether the bill’s authors have been cited by pressure to limit debts that are load-bearing.
Genius Law Issuers are explicitly prohibited By providing a stabilizer to take on yield, retail and institutional investors have effectively blocked interest in digital dollar holdings.
So Temujin Louie, CEO of Wanchain’s cross-chain interoperability protocol, warned against viewing legislation as an unlimited victory for the industry.
“In a vacuum, this may be true,” Louis told Cointelegraph. “However, by explicitly prohibiting stable issuers from offering yields, the Genius Act actually protects the main advantages of money market funds.”
As Auxiliary instrument reportmoney market funds or MMFS are becoming Wall Street’s answer to Stablecoins, especially when issued in tokenized form. JPMorgan strategist Teresa Ho points out that tokenized MMFs can unlock new use cases, such as used as margin collateral.
Louis agreed, claiming that “tokenization enables money market funds to adopt the speed and flexibility that previously made Stablecoins unique without sacrificing security and regulatory oversight.”
Paul Brody, EY’s global blockchain leader, told Cointelegraph that tokenized MMFs and token deposits “could find a significant new opportunity onchain,” especially in the absence of yields from Stablecoin Holdings.
“Money market funds can operate and look a lot like end-user stablecoins, but they do provide a difference in output,” Brody said.
According to EY’s Brody, the availability of output may be a decisive factor between tokenized MMF and Stablecoins. Still, he noted that stablecoins retain certain advantages:
“Allowing the use of stable people as a bearer asset means it can be easily placed into DEFI services and other OnChain financial services without the need for complex access and transfer control management. If tokenized money market funds have many restrictions to prevent such use, the attractiveness that may attract yields may not be enough to offset the additional operational complexity.”
Related: When Trump signs Stablecoin Act as law
Banking industry’s grasp of Stablecoin debate
The Genius Act prohibits the Stabalecoins who bear submission, and this is unshakable, COINTELEGRAPH Previous Report The bank hall appears to have had a significant impact on the ongoing policy debate around Stablecoins.
Back in May, Austin Campbell, a professor and blockchain consultant at New York University, cited sources in the banking industry, indicating that financial institutions are actively lobbying to prevent stable and stable people who own interest to protect their long-standing business models.
Campbell said that after decades of reserves were provided to depositors, banks were worried that their competitiveness would be threatened if stable issuers were allowed to provide yield directly to holders.
Nevertheless, within the obvious scope of U.S. securities regulations, there are indeed load-bearing digital assets in the United States. In February, the U.S. Securities and Exchange Commission approved the country First of all, bear stable stability and securityissued by the Character Market. The token called YLDS provides a 3.85% yield at release.
Related: Genius has set new Stablecoin rules, but remains vague to foreign issuers
