Stablecoin Boom: $4B Surge in Supply Follows US Regulatory Shake-Up

Stablecoins just got a $4 billion adrenaline shot—and Washington’s fingerprints are all over the syringe.

The catalyst? Fresh US legislation that’s either ‘innovation-friendly’ or ‘desperately playing catch-up,’ depending on which crypto lobbyist you ask.

Market makers are voting with their minting keys: Tether’s printing press is running hot, Circle’s reserves are swelling, and even the algorithmic upstarts are getting a second look.

Meanwhile, traditional finance quietly updates its ‘blockchain is a fad’ PowerPoint for the 47th time.

One thing’s clear: When regulators move, money moves faster. Whether that money stays put? That’s the trillion-dollar question.

In brief

• Stablecoin supply surged by $4 billion in one week following the GENIUS Act’s passage.
• New entrants like Anchorage, WisdomTree, and Wall Street banks are launching regulated fiat-backed stablecoins.
• The GENIUS Act provides legal clarity and sets strict rules for reserve backing, audits, and licensing.

GENIUS Act

For years, U.S. stablecoin issuers operated in a legal grey zone. The SEC issued warnings. The CFTC disagreed. Congressional action stalled. But with the GENIUS Act signed into law on July 18, the rules have changed, and the market is reacting fast.

The law creates specific guardrails for fiat-backed stablecoins: issuers must hold full 1:1 reserves, undergo independent audits, and secure proper licensing. These requirements aim to protect consumers while legitimizing the asset class for institutional use. And institutions are responding.

Anchorage, WisdomTree, and Wall Street step in

On Tuesday, Anchorage Digital, the only federally chartered crypto bank in the U.S., announced a new stablecoin issuance platform built in partnership with Ethena Labs. Their first product, USDtb, will launch under the GENIUS Act framework.

That same day, Wall Street asset manager WisdomTree launched USDW, a fully dollar-backed stablecoin designed to support dividend-paying tokenized assets. The fund meets all compliance standards laid out in the legislation. Meanwhile, Bank of America, JPMorgan, and Citi have confirmed they’re exploring their own stablecoin initiatives. 

Fiat-backed dominance solidifies

The stablecoin space is still overwhelmingly dominated by fiat-backed tokens, which now account for about 85% of the market. Leading are USDT and USDC, which together command over $227 billion in market cap.

Unlike algorithmic stablecoins, whose reputation took a major hit with the collapse of Terra’s UST, fiat-backed coins are collateralized by real-world assets like dollars and short-term Treasurys. The GENIUS Act specifically focuses on this model.

Crypto-backed tokens like DAI, which use overcollateralized ETH and other assets, continue to play a role, though at $4.3 billion, their footprint is modest in comparison. 

A new era for stablecoins

The $4 billion supply jump is a clear sign of momentum. Stablecoins are moving from crypto-native tools to institutional-grade instruments. They’re starting to power dividend payments, cross-border settlements, and even potential central bank integrations.

Perhaps most importantly, they now have bipartisan legislative support in the U.S. With regulation in place and Wall Street engaged, the stablecoin wars are entering a new phase.

Maximize your Cointribune experience with our "Read to Earn" program! For every article you read, earn points and access exclusive rewards. Sign up now and start earning benefits.