The recent American adoption of the act of engineering has marked a significant turning point for stablecoins, establishing a regulatory precedent which can shape digital finance worldwide.
Fabian Dori, director of investments at Sygnum Bank, joined the last episode of the Podcast Insight The size of the bytes of Cointeltelegraph, detailing how the law will influence the adoption of stablecoin, institutional engagement and international regulatory alignment.
Innovation and stability
The Engineering Act, which introduces a clear federal regulatory framework for the stables -supported by Fiat, requires total transparency of transmitters, including the support of assets one by one, compulsory federal licenses and independent reserve audits.
According to Dori, these provisions are essential to stimulate responsible innovation and financial stability.
“I really think that the impact of the genius law will be significant, both short and long -term,” said Dori.
“By demanding that stable issuers get a federal license, support their stabbed 1 to 1 with high -quality liquid assets and disclose reserve composition … Institutional investors can really have legal confidence to use regulated staboins.”
However, a controversial aspect of the law, the prohibition of stable -to -yield stablecoins can considerably retaliate the way in which stablecoins are integrated into decentralized finance (DEFI).
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Dori underlines that this decision can create a clearer distinction of the market between the stablescoins focused on payment and products on the monetary market generating yields.
“It is true that it is no longer possible to win the yield directly by holding stablecoins supported by Fiat,” he said.
“This will create a clear segregation between stablescoins without yield and money market funds.”
Europe on the United States
Another key subject discussed is the gap between regulations in Europe and the United States.
Europe, which has been cautious in its regulatory position, in particular with the Euro digital initiative, could now face pressure to accelerate innovation due to the American position passed by the law on engineering.
“It seems a bit that the United States is concentrating much more on a framework that allows and stimulates innovation, while Europe is mainly focused on risk management,” said Dori.
“The genius law will really attract both new issuers, but also new cases of use in the United States, which could then lead to Europe which needs or to be obliged to open up.”
Listen to the complete episode of Insight the size of an byte for the full interview on the page of Cintelelegraph podcasts, Apple or Spotify podcasts. And don’t forget to consult the full range of Cointelegraph of other shows!
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