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AllAfrica
25-07-2025
- Business
- AllAfrica
What India can teach the US about digital finance
The new US administration has made digital finance an early priority, championing three pieces of legislation governing digital assets—the GENIUS Act, the CLARITY Act, and the CBDC Anti-Surveillance State Act. The first bill was signed into law by President Donald Trump on July 18, while the latter two recently advanced to the Senate. The laws have given a boost to advocates of digital assets, but face harsh criticism from consumer advocacy groups and experts over safety and stability concerns. As US policymakers continue to consider the promise and perils of digital finance, they should look toward the experience of India, a global leader in digital payments and digital public infrastructure, for critical lessons on the centralization and adoption of consumer-facing digital finance. Although the bills collectively clarify the federal regulation of many digital assets for the first time, they broadly sideline the federal government from the developing ecosystem of digital finance. The clearest manifestation of this trend is the ban on Federal Reserve digital currencies in the CBDC Anti-Surveillance State Act, a policy that—if enacted—would make the United States an international outlier. For its part, the CLARITY Act would effectively reduce federal scrutiny of digital assets like cryptocurrencies. These aspects of the new legislation represent components of a broader agenda of deregulation, but they carry particular risks for the development of secure and successful digital finance in the United States. India offers a useful lesson in productive state-led digital finance, demonstrating a healthy balance between public-led initiatives and private sector partnerships that ultimately deliver quality options to consumers. India's central government has proactively developed 'digital public infrastructure' (DPI) under the India Stack framework and positioned the state as a provider of digital public goods. In India's digital payments ecosystem, for instance, the National Payments Corporation of India (NPCI) oversees the Unified Payments Interface (UPI) and serves as the central hub for real-time transactions between banks, payment service providers, and consumers. However, because of UPI's openness and interoperability, private sector platforms are among the biggest winners of India's digital finance revolution, including US firms—Google Pay and PhonePe (owned by Walmart) process nearly 90% of transactions. Moreover, government involvement through the centralized hub unlocks improved consumer data protection and record-keeping to combat fraud and financial crime. India's experience also demonstrates the key role of adoption in the transition to digital finance. Certainly, many of the initial applications of stablecoin technology will be for back-end transactions in financial markets, but US companies will eventually look to harness consumer-facing stablecoins to ease retail payment costs and enable new offers or discounts. As consumers adapt to novel technologies and navigate a potential proliferation of digital asset offerings, adoption will be a major roadblock—especially given the sluggish US shift to digital payments. India's digital finance adoption has been remarkable. With difficult initial conditions, the Asian country has emerged as the global leader in real-time digital payments, processing 18 billion transactions each month. The Indian government achieved this rapid adoption through forward-looking initiatives that laid the groundwork for the digital finance ecosystem, including the aggressive implementation of the 'JAM trinity' of banking, identification, and mobile access. Then, in designing the ecosystem, NPCI prioritized simplicity, convenience, and cross-platform integration—all boons for otherwise reluctant or unaccustomed consumers. Lastly, political initiatives played a major role in pitching digital finance to the wider population, exemplified by the public-facing Digital India program. Due to variations in economy and demography, the Indian experience does not map directly onto the United States, but policymakers should heed the universalizable lessons on the importance of complementary digital infrastructure, consumer-friendly principles, and awareness-building. How can US officials integrate these insights into the policy agenda for digital assets? First, the US government should embrace centralization, either through proactive public development or—more likely—through pointed regulation of private sector players. For back-end stablecoin applications, the development of a central hub akin to NPCI would lend stability to the emerging digital financial system, as well as improved documentation and cybersecurity. For consumer-facing applications, although the US government is unlikely to develop or require a unified digital assets platform, regulations aimed at ensuring openness and interoperability will help stem the growth of a complicated landscape of siloed proprietary stablecoins. Second, if the administration intends on making the United States the 'undisputed leader in digital assets,' it must take adoption seriously. To build up complementary infrastructure, India proliferated bank accounts and mobile phones—the US government could focus on augmenting connectivity or spreading access to new financial technologies like digital wallets. Moreover, adoption relies on trust. If regulators continue to underdeliver on consumer protection, the United States will struggle to maintain leadership on digital assets for retail applications. But if the US government follows the Indian example, companies and consumers alike will benefit from the new era of digital assets. Andrew Gordan is a Motwani Jadeja US-India fellow at the Pacific Forum, where he researches Indian tech diplomacy. He also serves as a junior fellow in the South Asia Program at The Stimson Center think tank. He received his BA in Government from Harvard and is a recipient of the Boren and Fulbright-Nehru scholarships. He has previously worked at The Council on Foreign Relations, Wilson Center and Harvard's Davis Center.
Business Insider
19-07-2025
- Business
- Business Insider
Circle Stock (CRCL) Falls after President Trump Signs Stablecoin Bill into Law
Shares of stablecoin issuer Circle (CRCL) fell today after President Trump signed into law a major new bill (GENIUS Act) that creates the first official federal rules for dollar-backed stablecoins. This is a major win for the crypto industry, which has long pushed for clearer regulations. Two additional crypto-friendly bills also passed the House this week: the CBDC Anti-Surveillance State Act, which blocks the creation of a central bank digital currency, and the Clarity Act, which gives oversight of digital assets (excluding stablecoins) to the SEC or CFTC. Both bills now head to the Senate, where their future remains uncertain. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week. The GENIUS Act gives U.S. companies a clear path to issue and manage dollar-backed stablecoins for payments. It includes strict rules, such as holding reserves in cash or Treasuries, regular audits, and full public disclosures, although it notably exempts Trump and his family from a ban on lawmakers profiting from stablecoins. That exemption caused delays earlier this year. Meanwhile, Trump is also backing a private stablecoin venture, World Liberty Financial, which launched its own coin with BitGo. As a result, Wall Street is quickly adapting to these changes. According to Yahoo Finance, JPMorgan (JPM) and Citigroup (C) both confirmed that they plan to enter the stablecoin space, with JPMorgan preparing to launch a deposit token (JPMD) for institutional clients. Interestingly, companies such as Amazon (AMZN) and Walmart (WMT) are also exploring stablecoin options. While backers highlight benefits like instant settlement and global access to the dollar, some skeptics still worry about risks, which include investor panic during market downturns. Is CRCL Stock a Good Buy? Turning to Wall Street, analysts have a Hold consensus rating on CRCL stock based on five Buys, five Holds, and two Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average CRCL price target of $185.73 per share implies 17% downside risk.
Yahoo
18-07-2025
- Business
- Yahoo
Trump signs stablecoin bill into law, capping string of 'Crypto Week' victories
President Trump on Friday signed into law a bill that establishes the first federal framework for dollar-backed stablecoins, one of the biggest victories yet for a crypto industry that has pushed for more favorable oversight in Washington, D.C. "I pledged that we would bring back American liberty and leadership and make the United States the crypto capital of the world, and that's what we've done," Trump said during a signing ceremony for the GENIUS Act at the White House. Two other crypto bills also passed through the House this week, the CBDC Anti-Surveillance State Act and the CLARITY Act, that served as additional wins for the crypto industry. They prohibit the creation of central bank digital currencies and assign oversight over all digital assets except stablecoins to either the Securities and Exchange Commission (SEC) or the Commodities Futures Trading Commission (CFTC). Both will now go to the Senate, where their ultimate fates are still unknown. The passage of all three bills came after a series of roadblocks and delays as GOP leaders struggled to bring some Republican holdouts in line during a week dubbed "Crypto Week' by backers of the legislation. Trump is also deepening his own financial involvement in cryptocurrencies with several separate ventures. They include World Liberty Financial, a new crypto startup backed by Trump and his sons that has already launched its own US-dollar-pegged stablecoin (USD1) in partnership with BitGo. Stocks with crypto ties have been surging recently as investors anticipated the moves in the nation's capital, notably Coinbase (COIN), Robinhood (HOOD), and newly public stablecoin issuer Circle (CRCL). Read more: Can you buy crypto with a credit card? See the pros and cons. The GENIUS Act signed into law by Trump Friday outlines how US companies can issue and manage dollar-backed stablecoins for payments, giving those digital assets a massive stamp of approval that is expected to encourage wider adoption. It bans members of Congress and their families from earning profits from stablecoins, but not Trump and his family, an omission that irked some Democrats and slowed progress on the legislation earlier this spring. Between Washington and Wall Street, the expectations are riding high for what this legislation ultimately brings. A senior Treasury official said growth in the $260 billion stablecoin market over the months and years ahead will have a significant impact on the dominance of the US dollar and demand for US debt. The legislation is also expected to unleash a wave of new stablecoin entrants as traditional companies ranging from banks to megaretailers consider whether to issue their own coins. "Banks and nonbanks have parity here, so I think the banks will be able to compete in this new payments regime," said Patrick McHenry, the former Republican congressman and House Financial Services chair who helped move forward an earlier iteration of the stablecoin bill in the last Congress. JPMorgan Chase (JPM) CEO Jamie Dimon and Citigroup (C) CEO Jane Fraser both said Tuesday they are planning to get involved in stablecoins, the latest evidence of how Wall Street is pivoting to embrace digital assets. Big banks have convened to explore prospects for launching a collaborative stablecoin network. Dimon, a longtime skeptic of cryptocurrencies, said the bank needs to embrace stablecoins as a way to keep pace with payment rivals. Last month, JPMorgan announced plans to launch a so-called deposit token called JPMD that is somewhat like a stablecoin but available only to JPMorgan's institutional clients. "We're going to be involved in both JPMorgan deposit coin and stablecoins to understand it, to be good at it," Dimon said. Other banks are also paying attention. "I think it's real. I think it's here to stay. I think it's a little overhyped at this point, but we'll figure out the best way that we can get involved," Bruce Van Saun, CEO of Citizens Financial Group (CFG), told Yahoo Finance. The Wall Street Journal has separately reported that Amazon (AMZN) and Walmart (WMT) are exploring stablecoin opportunities. The new wave of competition could upend the traditional payment system, especially if merchants seek to use stablecoins as a way to get around conventional card-based networks such as Visa (V) and Mastercard (MA). The legislation also would empower the Federal Reserve and the Office of the Comptroller of the Currency (OCC) to oversee stablecoin issuers that hold $10 billion or more in assets. Smaller issuers would be under the purview of state regulators. All issuers would be required to hold reserves in cash or US Treasurys, undergo regular audits, and publicly disclose their holdings and redemption processes. Like money market funds, the tokens must aim to be redeemable at face value. But unlike money market funds, stablecoins under this bill cannot pay interest. There's an ongoing debate about how widespread the usage of these digital assets will ultimately be. Stablecoin proponents tout these assets as a haven from crypto's wild volatility and a safer place for traders to store their gains because they can be pegged to non-crypto assets like the dollar. Their near-instant settlement and programmability also carry advantages proponents believe could enhance cross-border transactions and wider access to the US dollar. But there are still concerns among detractors that there could be risks with stablecoins, including the possibility of panic runs among investors. 登入存取你的投資組合
