President Donald Trump signed the establishment of guiding and national innovation for the American Stabecrims (Genius) Act on 18 July, implementing one of the first major pieces of the Cryptocurrency Act in the US.
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While the law only relates to stablecoins (a cryptocurrency with stable assessment associated with reliable assets such as gold or US dollars), it is a major step for the government regulation of cryptocurrency in the United States.
Crypto Regulations: America vs Europe
It was also an important step for the US to catch with other world governments, which have more dedicated regulatory structures to crypto markets. For example, the European Union (EU) implemented markets on December 30, 2024 in Crypto-asset (MICA) regulation, which units the crypto guidelines between all member states of the European Union. The asbestos aims to protect crypto investors, create a crypto guidelines and maintain the strength of the European Union markets.
In addition, according to the Chautham House, the asbestos “digital asset determines large -scale rules for issuers and service providers, which should facilitate innovation without threatening financial stability.” And it can be a catalyst for other crypto innovations, per eye per eye.
One of them is a central bank Digital Currency (CBDC) through an official “digital euro”. The CBDC is the official digital legal tender. On the other hand, many stabechoin are released privately and thus often contain comparatively regulation and incompatible levels of overseas.
While the Genius Act aims to provide a regulatory framework for stablecoins, some have concerns. For example, European Central Bank President Christine Lagard expressed concern about the Genius Act. According to the World Economic Forum, he stated that US dollar -backed stabechoin pose a threat to monetary policy and European autonomy. She has pushed to develop a digital euro, and in a recent speech, she explained that this is a “strategy priority” that can protect the monetary system in Europe.
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Post-Genius Stabecrim Strategy for America
Meanwhile, the American Crypto law is still almost widespread as the European Union, and the US can be on a overall different path by placing a premium on a privately supported stabelin.
Currently, according to MCKINSEY & Company, StableCoin circulation is less than 1% of all global money transactions (about $ 30 billion). Growing rapidly in popularity, they are still a small part of the overall crypto market. For those Americans who use stabelcoins domesticly, the Genius Act offers far more oversight in the US marketplace, with less possibilities for scams and a system of consumer safety now to protect your digital wallets.
Despite the guidance, there are still a lot of questions about stabechoin and how they are seen by governments. According to BFRR, the US and the European Union frames Stabechoin’s strategic role differently. The US sees him as a geopolitical tool, while the European Union is more suspicious. Therefore, unless there is no regulatory confluence between the US and the European Union, the investors can consider playing it safely, focusing on the investment domestic and adjusting the crypto strategies, as it remains to be seen how the Stabelcoin market can be affected by different assets of property.
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This article originally appeared on Gobankingrates.com: Crypto Rules vs. America in Europe: Do you need to change your stabechoin strategy?
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