Healthy competition promotes innovation and the best products for consumers; It is in the center of American economic leadership. Unfortunately, now That the Bipartisan Genius Law has been signed, the main inherited financial institutions seem to be having doubts about the innovations that Stablecoins can contribute to financial markets. Banking lobbying groups and public affairs teams have been turning off the Congress with complaints about the law, urging members to reopen the debate and introduce changes in the legislation that will guarantee that the stable market does not grow too fast, protecting the profits of the banks and suffocating the choice of consumer.
This reactionary response is exaggerated and unnecessary. What inherited financial companies should do is adopt the competition and offer new and exciting products and services that consumers want, not try to beat the emerging players through rules and anti-innovation regulations.
Genius law was carefully designed with a complete bipartisan process to strengthen consumers’ safeguards, guarantee regulatory supervision and preserve financial stability. The efforts to reverse their provisions are less about the protection of families and more on the protection of rooting bank interests of competition that helps ensure that the US banking system is the strongest and most innovative in the world.
Critics warn that allowing Stablecoins to provide rewards could lead to massive deposit outputs of community banks, with figures of up to $ 6.6 billion mentioned. But a more detailed exam shows that this fear is unfounded. An analysis of July 2025 of the consulting firm Charles River Associates did not find a statistically significant relationship between the adoption of Stablecoin and the departures of community banks. In fact, the overwhelming majority of Stablecoin reserves remain in the traditional financial system, either in commercial bank accounts or in the short -term treasure bonds, where they continue to support liquidity and credit in the broader US economy. Severe estimates are based on unrealistic assumptions that every dollar of the Stablecoin issues permanently leaves the banking system.
Stablecoins is not diverting resources away from loans. In any case, its growth can increase tickets to the monetary offer of the United States over time, according to a report from the Treasury Department. That means that Americans can benefit from modern and programmable digital dollars without threatening credit availability in their communities.
Others have urged the repeal of section 16(D) of the Genius Law, which allows the subsidiaries of the state institutions to carry out the Stablecoin business through the state lines without the need for additional licenses. If this important part of the genius is repealed, the result would be a fragmented, buccanized and ineffective regulatory regime that suffocates interstate trade.
Innovation has always been the soul of US capitalism: it is what separates the dynamic market economies from stagnant and protected. Instead of trying to eliminate new market participants, banks should be working to ensure that their current and future customers have access to avant -garde products and services, including healthier interest rates in deposit accounts.
While the objective rate of the Federal Reserve today is exceeding 4%, the average current account produces only 0.07%and savings accounts of 0.39%. That gap does not reflect consumer protection; It reflects the value captured by the banks. Stablecoin rewards programs, on the contrary, allow platforms to compete face to face for customers in a way that forces holders to offer better value. Consumers earn when competition exists.
Genius law positions the United States as the world leader in digital finances while maintaining stronger consumer protections. Congress already discussed and resolved these issues through careful bipartisan deliberation. The law requires individual reservations in cash or solid treasure, and transparency much farmer bonds, and far beyond what is expected of traditional deposits. Reitigaging these questions would now undermine that consensus and threaten to slow down the leadership of the United States in digital finances.
The stablecoins do not represent an escape, they represent an innovation that preserves the stability of the banking system while providing consumers with the benefit of competition. Policy formulators should see through this fear campaign and support the Bipartid Marco Bipartides, the Congress already promulgated.
Innovation and competition built US financial leadership. It is time to let it work again, and not allow the titular interests to suffocate their promising growth. American consumers deserve nothing less.
