In Latin America, a region marked by remittances, the stablcoins would gain greater legitimacy.
The blocking of foreign stablcoins could generate friction between the US and other countries.
The United States Senate took a historic step by approving the National Innovation Orientation and Establishment Law for Stablecoins, known as Genius. This bipartisan initiative, promoted by Senator Bill Hagerty, seeks to strengthen the global hegemony of the dollar and modernize the payment system, which would involve an impact globally.
The Genius Law, approved by the United States Senate, now await the review of the House of Representatives, where it will be sought to reconcile with similar initiatives such as the Stable Law.
The regulations propose a rigorous regulatory framework for stablecoins linked to the dollar (USD), such as USDT and USDC. It includes backup requirements 1: 1 of the assets, periodic audits and supervision by authorized entities.
If the House of Representatives rejects the genius law, the project would not advance directly and would have to be reviewed to address the objections of legislators. This would imply negotiations to resolve differences and achieve a consensus that allows the initiative to submit to a new vote in both cameras.
As Cryptonoticias reported, the Genius Law establishes a strict framework for the issuance of Stablecoins in the United States, restricting this activity to regulated and financially solid institutions. It also contemplates severe sanctions for those who issue this type of assets without authorization.
Besides, It gives the Department of Treasury the power to block foreign stablcoins that do not comply with the country’s legal standards. The project also promotes bilateral agreements to facilitate cross -border transactions and promote interoperability between regulated stable currencies.
In the event that the text promoted by Bill Hagerty becomes law, What would be its implications for Latin America and the rest of the world? Next, we analyze its possible impact from a regional and global perspective.
The impact in Latin America
In Latin America, a region with high adoption of cryptocurrencies due to economic instability, inflation and low banking, this law could have positive impacts, contributing to access to the dollarthe largest global reserve currency.
In countries such as Argentina and Venezuela, where cryptoactive ones function as a refuge in the face of the devaluation of local currencies and monetary restrictions, the new regulatory framework would contribute greater legitimacy and confidence to the stablecoins.
Anyway, it is worth mentioning that, although the dollar is famous for better maintaining the value than other Fíat currencies, it is also subject to devaluation for its growing emission controlled by the Central Bank. And the same applies to the stablecoins, since they continue their price.
In turn, the measure, by promoting Stablecoins’s investment, would mean greater liquidity for Bitcoin (BTC) and cryptocurrencies in general globally. That is why this regulation is seen as an upward sign for this market.
In addition to retail use, Greater legal certainty and operational transparency could promote the institutional and business adoption of the stablecoins in the region.
The mandatory reserve support, together with the supervision of entities such as the FIC (Federal Corporation for Deposit Insurance), would contribute to reducing the risks of fraud or collapses, such as the one that occurred with Terrausd in 2022.
On the other hand, remittances – an economic pillar in countries such as Mexico, El Salvador and Guatemala – could also benefit. The interoperability promoted by bilateral agreements would facilitate rapid and low -cost transactions with Stablcoins, strengthening its use in cross -border payments.
So also, in different economies, Regulated stablecoins could serve as a complementary alternative for international tradewith adoption potential in other countries in the region.
However, it is important to note that local issuers in the region could face significant challenges. The Faculty of the Treasury Department to block foreign stablecoins that do not comply with US regulations could make project development difficult in some countries, thus limiting innovation.
The case of the European Union and possible tensions
When strictly regulating the stablecoins linked to the dollar, the United States seeks to strengthen the hegemony of its monetary sign in the world economy, which could limit the growth of stable currencies anchored to other currencies.
Although, This legislation feels a precedent that other jurisdictions could followadopting similar regulations to maintain its competitiveness and ensure interoperability with the US market.
In fact, the European Union, through its MICA regulations – if I decided – could seek reciprocity agreements to promote new global standards. However, the Faculty of the Department of Treasury to block foreign stablcoins that do not comply with US regulations could generate tensions with countries that do not align their regulations.
The Genius law represents a significant advance towards the integration of the stablecoins into the global financial system, seeking a balance between consumer protection and the promotion of innovation.
For Latin America, these regulations offer opportunities to give greater legitimacy to the use of projects such as USDT and facilitate cross -border transactions, although it also presents challenges related to financial inclusion and technological autonomy.
At the global level, the law strengthens United States leadership in digital finances, although its rigorous approach could generate tensions with other jurisdictions. The final approval, still pending in the House of Representatives, will be key to determining its definitive impact on the region and the rest of the world.
