US Treasury Secretary Bessent: Stablecoin legislation backed by US Treasuries will expand USD usage.

US Treasury Secretary Bessent: Stablecoin legislation backed by US Treasuries will expand USD usage.

US Treasury Secretary Bessent has expressed support for stablecoin legislation that could significantly expand the usage of the US dollar (USD) globally. The proposed legislation, currently moving through the US Congress, aims to establish a regulatory framework for stablecoins, which are digital assets pegged 1:1 to fiat currency, such as the USD.

The Senate’s GENIUS Act of 2025 is at the forefront of this legislative effort. The bill outlines requirements for permitted issuers, redemption practices, and federal-state regulatory coordination. If enacted, the law would impact all sectors of the global payment system navigating stablecoin issuance in the US market [1].

Stablecoins have gained traction as a means of facilitating cross-border transactions and providing a stable alternative to traditional cryptocurrencies. The legislation aims to bring stablecoins into the mainstream by creating a regulatory framework that ensures their safe and effective use. This includes defining what constitutes a "payment stablecoin," establishing requirements for permitted issuers, and setting out comprehensive legal regimes governing their usage [1].

One of the key aspects of the GENIUS Bill is the establishment of "permitted payment stablecoin issuers" (PPSIs). These issuers would be authorized to act as approved digital assets under federal oversight. The bill also includes provisions for monthly reporting by PPSIs, anti-money laundering measures, consumer protections, and insolvency rules [1].

The legislation is part of a broader trend of global jurisdictions implementing regulatory frameworks for stablecoins. Countries such as the United Kingdom, the European Union, the United Arab Emirates, and Hong Kong have either implemented or are in the process of implementing similar frameworks [1].

US-based payment companies are evaluating broader-scale adoption of payment stablecoins to facilitate cross-border transactions. Retailers and other segments of the economy are also exploring possible use cases for payment stablecoins. A wider adoption of these digital assets is likely to galvanize policy makers and legislators in the US [1].

The implementation of stablecoin legislation backed by US Treasuries has the potential to significantly expand the usage of the USD globally. As the legislation moves forward, it will be crucial to monitor the ongoing negotiations and the final form of the bill. Financial institutions and other stakeholders should stay informed about the developments and be prepared to adapt to the new regulatory environment.

References:
[1] https://www.morganlewis.com/pubs/2025/06/the-future-of-payments-us-stablecoin-legislation-takes-shape