NEW YORK – The global financial system is on the brink of a transformation. As a recent Bretton Woods Committee paper points out, stablecoins – digital assets usually backed by a fiat currency, commodity, or another cryptocurrency to minimize volatility – have the potential to make payments and money transfers faster, cheaper, and more transparent, while also expanding financial inclusion. That is why many jurisdictions, including the European Union and Japan, have already sought to seize the opportunity by providing regulatory clarity for the industry. But it is the United States that is ultimately best positioned to lead, given that the $200 billion in stablecoins circulating today are predominantly denominated in dollars.
We have already seen early signs of what the US approach might look like. In late January 2025, President Donald Trump issued an executive order directing federal agencies to “promote the development and growth of lawful and legitimate dollar-backed stablecoins worldwide.” His AI and crypto czar, David Sacks, then gave a press conference to showcase a bipartisan roadmap for digital-asset legislation.
Recent bipartisan legislative activity does indeed show that Congress understands the stakes. The Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, introduced by Senators Bill Hagerty, Tim Scott, Kirsten Gillibrand, and Cynthia Lummis, would establish a federal framework for larger stablecoin issuers, while preserving state-level regulatory authority for smaller ones.
Meanwhile, the House Financial Services Committee is considering the Stablecoin Transparency and Accountability for a Better Ledger Economy (STABLE) Act, which similarly aims to bring oversight and greater transparency to the market. The committee has also released a discussion draft that was previously negotiated between its Republican former chair, Patrick McHenry, and the ranking Democratic member, Maxine Waters.
Congressional action could not be more urgent. Promoting more economic activity on digital ledgers (blockchains) could have profound implications for the efficiency and inclusiveness of the financial system, ultimately bolstering people’s standard of living. For decades, the global financial system has struggled with outdated infrastructure that makes payments slow, expensive, and inefficient. Traditional remittances, for example, take days to settle and still cost an average of 6.62% of the amount sent.
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