Legacy Banks Resist Stablecoin Innovation Despite GENIUS Act Passage

The bipartisan GENIUS Act has become law, yet major financial institutions are pushing back against the competitive pressures it introduces. Stablecoins—digital assets pegged to stable reserves like the dollar—promise to revolutionize payments and financial services. Banks, however, are lobbying Congress to amend the legislation, fearing rapid market growth could erode their dominance.

This resistance undermines the Act's intent: fostering innovation while ensuring consumer protection and financial stability. The law emerged from rigorous bipartisan negotiations, balancing regulatory oversight with market freedom. Critics argue that stablecoin rewards could trigger deposit outflows from traditional banks, but such concerns appear exaggerated. Healthy competition has long driven U.S. economic leadership; stifling it to protect legacy profits risks stagnation.