Navigating the Genius Act: Circle’s Vision for Stablecoin Legislation

Stablecoin issuer circle has been the hot trade on Wall Street this past month.

The company's New York Stock Exchange IPO priced at $31 a share.

But eager traders have pushed the USDC issue well over $200 in a matter of weeks.

Now crypto advocates believe Circle's success points to pent up demand for digital assets exposure from trad 5 giants.

Well, joining me this morning is Dante.

Parte, chief strategy officer and head of global policy and operations at Circle.

Dante, good morning.

Thank you so much for joining me.

So Circle seeing a triple digit percentage surge since day one, including a 168% pop on day one, the biggest first day gain ever for a company that raised at least a billion dollars.

So tell us about the reaction from inside the company walls, not to mention some of the stakeholders.

Well, thank you, Remy.

It's always good to be back on with you.

Um, I think one thing we're tracking very closely right now, um, is, is, of course, the legislative progress here in Washington DC.

As you know, the Genius Act has passed the Senate with more than 1818 Democrats in total have voted in favor of it, so it's a very strong bipartisan signal here in DC, and the President has recently issued a call to action to leaders in Congress to effectively advance the Genius Act without any delays or any further amendments.

So that's something that we're watching very closely and effectively advocating on behalf of passing stablecoin legislation in the United States.

It's one of the things that's missing.

Um, as you look at the broader developments in crypto markets right now, the lack of US federal regulatory standards is a really important piece of the puzzle right now.

Yeah, and Dante, as you mentioned, we're keeping a close eye on the progress of the Genius Act, but what does the Genius Act actually mean for Circle's business model?

Well, it's, it's actually in our view, it's bigger than Circle, frankly.

In some ways, the Genius Act would enshrine the way we have done business as the, the, the legal standard so that gone are the days where anyone anywhere can counterfeit the US dollar and upload it onto the internet.

We have seen over the last many years in the sector quite a lot of.

Examples of unchecked financial alchemy when it comes to the US dollar.

And so if you think of the Genius Act, it's really a bill that not only advances optionality in the US payment system domestically, it's also a bill that would set a standard and a floor, making regulated payment stablecoins an export product from the United States as opposed to an import product.

So that's one piece of the puzzle.

The second piece of the puzzle is the Genius Act would preserve a really important feature in how FinTech evolves in the US, which is state oversight, subject to a federal floor when it comes to stable coins.

And then it would also create very clear competitive swim lanes for banks, nonbanks, and credit unions.

And then I think the last two very important pieces of the Genius Act puzzle are the consumer protection.

Gains that we would make for digital assets very broadly, but for stablecoin specifically.

And then lastly, the national security imperatives.

All stablecoin issuers in the United States and those purporting to offer these products from overseas into the US would be subject to the Bank Secrecy Act, to financial crimes compliance norms, and of course to sanctions obligations, among others.

So it's a very, very strong package and we think that would create an environment that advances competitiveness in the payment system and of course competitiveness for the US dollar.

And Dante, when it comes to timeline here, we have been talking about regulation for digital assets in the US for many months now, but when it comes to timeline, what are you looking at here and what are your expectations as we head into the second half?

Sure, well, one, I would, I would just send a message to colleagues on the in the Congress, of course, which is that while the Genius Act has come out of the Senate with bipartisan support, including the 18 Democrats that voted in favor of it, its legislative proposal was really born in the House Financial Services Committee probably 7 years ago.

I've been in most of the public hearings.

In the US on advancing staple Poin legislation and so I think there's an opportunity now to look at advancing the Genius Act on a standalone basis before the summer recess that would create legislative momentum.

It would be a bipartisan political win and frankly it would be a product that is in the national interest as opposed to the narrow interests of.

Industries or single single sectors, fundamentally it is about the US dollar.

Fundamentally it's about optionality in the payment system, consumer protection, and a lot of issues that we have been legislating, debating, and advocating for for many years, and the fact that it enjoys bipartisan support, I think would really be a win of bipartisanship here in DC and for the country.

And Dante, while I have you here, I do want to expand on some of Circle's recent company developments from launching on the XRP ledger to continuing to work with Mastercard.

Tell us how Circle has grown on the business side since we last spoke here at the New York Stock Exchange.

Well, sure, as you know very well, the, um, of course, the moment we've achieved recently in taking the company public was a long standing milestone.

Um, a lot of the ongoing work that we have as a company as well is for us in some respects business as usual.

We've always felt that our business model was about promoting optionality in the payment system, promoting this broader notion of an internet financial system, and so this idea of integration with the banking system, with partners, of course growing regulatory clarity in the US and around the world has been for us a feature. of the way we do business and so that's, that's effectively the way we continue to operate.

The piece that that of course I'm here to discuss the most today is, is advancing US stable claim legislation, which is not only interesting for us, interesting for the country, and interesting for the the bank nonbank boundaries and where FinTech can can continue to compete and promote a level playing field in this market.

So we're excited about all of those developments, and as always, Remi, it's great to be on with you, uh, you know, on the program.

Yeah, and Dante, building on what you just said, as the stablecoin market expands, what infrastructure or policy shifts are needed to actually support broader consumer use?

Well, I think the main thing, the main thing, frankly, you know, as much as I've mentioned the Genius Act a number of times, is the other piece of this is, of course, regulatory harmonization overseas.

As you know, the European Union has a very broad digital assets framework that creates a level playing field, not just for stablecoins, but the broader set of crypto market structure.

So we think it's important that as a fast follow on to the Genius Act. that the Senate and the House, of course, contemplate crypto market structure legislation as well.

We understand that there's a series of proposals emanating on the Senate side, which would be a great companion to the Clarity Act that recently passed on the House side.

And so we have an opportunity to get this grand bargain, if you will, where stablecoin legislation can get passed into law before the summer recess, and then the United States can follow up very quickly thereafter with market structure legislation as well.

The last piece is, I think a major country to watch, of course, is the United Kingdom.

The UK has in many respects a second mover advantage in being able to establish a set of principled rules for stablecoins and broader digital asset markets.

And so we're keenly watching the UK developments as well because that would create in major global financial centers.

Legal clarity, regulatory clarity, and greater degrees of harmonization and interoperability of this internet scale financial infrastructure cannot do it without rules, even if all other things are equal.

There's no, there's no shortcut effectively for regulatory clarity and legal clarity.

OK, Dante, well, we will have to leave it there as we're fast approaching the opening bell here at the New York Stock Exchange, but hopefully we can have you back on the show live in our studio at the New York Stock Exchange.

Thank you so much, Remy.