With the stablecoin bill aka GENIUS Act set to pass through the US Senate, Wall Street banking giants have started exploring a joint stablecoin venture, which could pose a major threat to dominant market players like Circle (USDC), and Tether (USDT), believes crypto market veteran Arthur Hayes. Citing this development, Hayes wrote: “Bye bye Circle. Thanks for playing”.
Arthur Hayes Bids Bye to Circle, USDC Dollar-Peg Fumbles
The latest WSJ report notes that top Wall Street banking giants like Wells Fargo, Bank of America, JPMorgan Chase, and Citigroup, as evaluating a joint collaboration for a stablecoin project. As the GENIUS Act proceeds to the US Senate vote, commercial banks are already preparing for the next big opportunity in the stablecoin market. These developments have sent jitters, especially to Circle’s USDC, which saw its dollar-peg fumble a bit, while slipping to $0.9987 earlier today.
Crypto veterans like Arthur Hayes believe that the big banks could threaten USDC’s existence with the stablecoin project. Interestingly, this development comes just at a time when Circle is reportedly in discussions with Ripple and Coinbase for a potential sale.
Market analysts believe that big fish are focusing on this acquisition Circle’s user base, on-chain application integrations, and extensive liquidity. The true value of USDC lies entirely in its on-chain presence in the decentralized finance (DeFi) sector.
How Big Banks Could Change the Stablecoin Game?
It’s now or never for Wall Street banking institutions to adapt to stablecoin market demand, as big tech firms and retailers enter the space. Not pivoting to digital assets could mean risking their payments and deposit base. France’s Société Générale plans to introduce a USD-backed stablecoin on the Ethereum blockchain.
Although big banks seek to address the rising competition from the crypto sector, this initiative is still in the conceptual phase, as a large of the progress hinges on upcoming legislation , including the GENIUS Act, which recently advanced in the Senate.
The GENIUS Act outlines a framework for both banks and nonbanks to issue stablecoins, while restricting public companies outside the financial sector. Banks see an opportunity to harness stablecoins for quicker and more cost-efficient payments, particularly for cross-border transactions.
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Bhushan Akolkar
Bhushan is a FinTech enthusiast with a keen understanding of financial markets. His interest in economics and finance has led him to focus on emerging Blockchain technology and cryptocurrency markets. He is committed to continuous learning and stays motivated by sharing the knowledge he acquires. In his free time, Bhushan enjoys reading thriller fiction novels and occasionally explores his culinary skills.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
