https://cointelegraph.com/news/genius-act-clause-limits-big-tech-stablecoin-power

Circle’s Dante Disparte says the GENIUS Act ensures tech giants and banks can’t dominate the stablecoin market without facing strict structural and regulatory hurdles.

The GENIUS Act contains a little-noticed clause that prevents technology giants and Wall Street behemoths from dominating the stablecoin market, according to Circle Chief Strategy Officer Dante Disparte.

“The GENIUS Act has what I’d like to call — just for my own legacy sake — a Libra clause,” Disparte told the Unchained podcast on Saturday. Any non-bank that wants to mint a dollar-pegged token must spin up “a standalone entity that looks more like Circle and less like a bank,” clear antitrust hurdles and face a Treasury Department committee with veto power over the launch.

Banks don’t get a free pass either. Lenders that issue a stablecoin must house it in a legally separate subsidiary and keep the coins on a balance sheet that carries “no risk-taking, no leverage, no lending,” Disparte noted.

That structure is even “more conservative” than the deposit-token models JPMorgan and others have floated. “It creates clear rules that I think in the end the biggest winners are the US consumers and market participants and frankly the dollar itself,” he added.

GENIUS Act passes with bipartisan backing

Passed last week with more than 300 House votes, including support from 102 Democrats, the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act gives the dollar “rules-based” firepower in the global digital-currency race, Disparte argued.

“Crypto is finally getting what it wanted: legitimization, a path for legal and regulatory clarity in the United States and an opportunity to compete,” he said.

The bill preserves the patchwork of state money-transmitter laws for issuers under a $10 billion threshold but demands a national trust-bank charter once assets breach that level.

Notably, the law bans interest-bearing stablecoins, pushes rigorous disclosure standards and introduces criminal penalties for unbacked “stable” tokens. Terra-style experiments are “gone,” Disparte said.

However, critics argue the ban on yield could stunt consumer adoption and hand an advantage to overseas issuers. Disparte claimed that yield “is a secondary-market innovation” better delivered by decentralized finance protocols once the base layer is rock-solid.