Six crypto firms vie for U.S. bank charter under 2025 GENIUS Act

Ripple, Circle, and Fidelity Digital Assets are among six cryptocurrency firms competing to obtain a U.S. bank charter, signaling a strategic pivot toward regulatory alignment and institutional adoption. This development coincides with the implementation of the Guiding and Establishing National Innovation for U.S. Stablecoins Act of 2025 (GENIUS Act), which establishes a federal framework for stablecoin regulation. The legislation mandates 1:1 reserve backing for payment stablecoins, imposes compliance requirements, and restricts non-financial entities from issuing stablecoins without approval, creating a regulatory environment that incentivizes crypto firms to seek traditional banking infrastructure. The act also repeals SAB 121, a prior accounting rule that barred banks from custodizing crypto assets, further integrating digital assets into mainstream finance [1].

The race for a bank charter reflects a broader industry trend toward legitimization. Companies like JPMorgan, despite CEO Jamie Dimon’s public skepticism, have been advancing blockchain solutions since 2019, including its JPM Coin. The GENIUS Act’s emphasis on transparency and consumer protection has prompted firms to hire compliance officers and collaborate with regulated institutions. Guillaume Poncin of Alchemy described the regulatory climate as a “perfect storm” for innovation, predicting widespread adoption of stablecoins by major banks. This shift is amplified by the act’s focus on use cases such as cross-border payments and tokenized real-world assets (RWAs), with JPMorgan recently enabling clients to use Bitcoin as collateral for loans [1].

Stablecoins are emerging as critical infrastructure for real-time transactions and treasury optimization. Circle’s $20 billion initial public offering and the launch of World Liberty stablecoin USD1—a project backed by the Trump family—highlight growing institutional and political support. The Biden administration’s pro-stablecoin stance, articulated by Vice President JD Vance, positions these assets as tools to enhance U.S. economic influence. However, the act’s prohibition on stablecoin yield—barring direct interest payments to holders—could drive demand for decentralized finance (DeFi) platforms, where users can earn returns on their stablecoin holdings. Analysts note this regulatory clarity may accelerate adoption but also create friction with existing DeFi models [1].

While the GENIUS Act has bipartisan support, critics warn of political risks. Anti-crypto factions within Congress could challenge its provisions if they regain power. Yet, industry leaders argue that blockchain’s utility—such as faster settlements and lower operational costs—has already embedded itself in financial systems. The act’s focus on use cases over political conflicts suggests a long-term trajectory toward integration. For example, 1inch Labs highlights the potential of tokenization to improve liquidity in global markets, while Moon Pursuit Capital founder Utkarsh Ahuja emphasizes stablecoins’ role in expanding financial inclusion in developing economies [1].

The competition for a bank charter underscores crypto’s transition from speculative assets to foundational financial infrastructure. By addressing past ambiguities, the GENIUS Act paves the way for stablecoins to function as core components of a digital financial ecosystem. The success of firms like Ripple, Circle, and Fidelity in securing regulatory approval could determine the pace and scale of this transition. As institutions like JPMorgan and Wall Street firms deepen their blockchain integration, the lines between traditional finance and crypto continue to blur, reinforcing the U.S. dollar’s dominance in global trade and setting the stage for a broader adoption of tokenized assets.

Source: [1] [title1Year of the stablecoin: The GENIUS Act, Wall Street, and ...] [url1https://cryptoslate.com/year-of-the-stablecoin-the-genius-act-wall-street-and-the-dollars-digital-leap/]