Opinion: The U.S. GENIUS Act on stablecoins could lead to the privatization of the dollar and face the risk of de-dollarization

According to Cointelegraph, the U.S. Senate Banking Committee has voted to pass the GENIUS Act, a bill that regulates issuers of stablecoins. This clears the way for stablecoins to be adopted as a means of payment outside of cryptocurrency trading. However, this bill could potentially lead to the privatization of the dollar and increase risks of de-dollarization because it allows issuers of stablecoins not to be bound by federal consumer financial protection measures similar to those for credit cards and peer-to-peer payment platforms. They can also invest in money market funds, repurchase agreements, and uninsured bank deposits - assets that were bailed out during past financial crises - which indirectly affects the dollar. Data shows that the proportion of dollars in global foreign exchange reserves has dropped from over 70% at the beginning of this century to less than 60%.