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The GENIUS Act’s requirement for all approved stablecoin issuers to have robust AML, KYC and risk monitoring programs coupled with national trust bank charter that allows companies to offer crypto custodial services to open the stablecoin market to a wider range of users

July 23, 2025 //  by Finnovate

With the GENIUS Act now law, stablecoin issuers—including banks and fintechs—finally have regulatory clarity under federal oversight, allowing for broader adoption. Federally insured banks can issue stablecoins, while fintechs require Federal Reserve approval. The law aims to legitimize stablecoins with rules on consumer protections, reserves, AML, and KYC, drawing more users and revenue. Paxos CEO Charles Cascarilla said the law will help stablecoins go mainstream, while Mastercard’s Jorn Lambert emphasized regulation as key to adoption. Paxos, PayPal, Fiserv, and Mastercard are part of the Global Dollar Network pushing for scale. Though stablecoins won’t likely replace everyday payments in developed economies, they’re seen as transformative for cross-border transactions, gig economy pay, and digital wallets. Tether and Circle welcomed the law, with Circle seeking a national trust bank charter to expand its services. Critics, including the ABA and Consumer Reports, warn that stablecoins could disrupt traditional banking and lack adequate consumer safeguards. Still, large banks like Citi, JPMorgan, and BofA are exploring stablecoin strategies, with Citi appearing the most bullish, according to KeyBanc.

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