The post Federal Reserve Limits Stablecoin Interest in GENIUS Act Enforcement appeared on BitcoinEthereumNews.com.

Key Points: Federal Reserve restricts interest payments for stablecoins under GENIUS Act. Stablecoins must focus on payments, not savings. Impact on fiat-collateralized stablecoins USDC, USDT, FDUSD. Federal Reserve official Austan D. Musalem announced that the GENIUS Act requires stablecoins to remain primarily as payment tools by imposing restrictions on interest payments, according to ChainCatcher and Jinshi reports. This underscores regulatory emphasis on maintaining stablecoins’ primary function as payment instruments, impacting stablecoin issuers like Tether and Circle, with implications for DeFi platforms and overall financial stability. Federal Reserve Imposes Interest Limits on Stablecoins Federal Reserve official Austan D. Musalem stated that the GENIUS Act requires stablecoins to remain payment tools and prohibits their use as savings vehicles with interest payments. This affects fiat-collateralized stablecoins like USDC, USDT, and FDUSD. Immediate changes include the end of yield-earning programs for stablecoins. Restrictions aim to prevent digital assets from acting as unregulated deposit instruments, pushing them solely towards use as payment utilities. Market reactions have been muted as stablecoins maintain their payment role. Major platforms and exchanges have not issued statements. Vitalik Buterin supports regulatory clarity but has not commented on these specific constraints. GENIUS Act’s Wider Impact on Crypto Regulation Did you know? Historical actions, such as the SEC’s 2022 ruling against BlockFi, set precedents that stress the importance of regulation to prevent stablecoins from becoming unregulated financial products. According to CoinMarketCap, USDC currently trades at $1.00 with a market dominance of 1.91% as of September 22, 2025. Its fully diluted market cap stands at approximately $73.92 billion with a 24-hour trading volume of about $22.39 billion. Recent price changes have seen a 7-day increase of 4.18%. USDC(USDC), daily chart, screenshot on CoinMarketCap at 18:05 UTC on September 22, 2025. Source: CoinMarketCap Coincu research predicts the GENIUS Act’s restrictions could direct crypto development…

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Filed under: News - @ September 22, 2025 10:29 pm