Coinbase and Circle Shares Surge 16.32% and 33.82% After Senate Approves GENIUS Act

On Wednesday, shares of Coinbase and Circle surged following the U.S. Senate's approval of the GENIUS Act, a bill aimed at establishing a regulatory framework for stablecoins. The bill, introduced by Tennessee Senator Bill Hagerty just six weeks prior, passed with a vote of 68-30. This development is seen as a significant step toward creating clear guidelines for stablecoins, marking a bullish signal for the entire crypto industry.

Coinbase, listed on the Nasdaq, closed the trading day with a 16.32% increase, reaching $295.29 per share. Circle, listed on the NYSE, saw an even more substantial rise of 33.82%, closing at $199.59. The rally was driven by the Senate's approval of the GENIUS Act, which many in the crypto market view as a positive development for the industry.

The GENIUS Act is expected to benefit Circle, the issuer of USDC, the second-largest stablecoin by market capitalization. Circle's revenue primarily comes from the interest earned on the reserves backing USDC, which it co-founded with Coinbase in October 2018. The passage of the bill is anticipated to further boost Circle's financial performance, as it provides a clearer regulatory environment for stablecoins.

The market's reaction to the bill's passage was swift and positive. Crypto trader Genco noted that the market is beginning to recognize the significant revenue streams that Coinbase derives from USDC, including a 50% share of CRCL revenue generated from USDC and 100% of revenue from USDC on the Coinbase platform, as well as an equity stake. Genco described the current situation as a "Stablecoin Summer," suggesting that the passage of the GENIUS Act will be a key driver of growth in the stablecoin market.

Crypto analyst TylerD echoed this sentiment, stating that Circle's stock surge is the "talk of the town." Meanwhile, crypto entrepreneur Anthony Pompliano pointed to Coinbase's stock surge as an indication that Wall Street is increasingly interested in Bitcoin and other crypto assets. The passage of the GENIUS Act is seen as a significant step toward creating a more favorable regulatory environment for the crypto industry, which could attract more institutional investors and drive further growth in the market.

The passage of the GENIUS Act is also expected to have broader implications for the crypto industry. Some market participants believe that this could be the start of more stablecoin companies going public, although there are differing opinions on whether this will be successful. BitMEX founder Arthur Hayes warned that most new public stablecoin companies will be overvalued and fail, and claimed that Circle's stock price is "insanely overvalued." However, the overall sentiment in the market remains positive, with many investors and analysts optimistic about the future of stablecoins and the broader crypto industry.