The decline in gold surprised many, prompting analysts to offer a range of explanations—especially since a correction was widely expected after its unprecedented historical rise. Some commentary even pointed to a potential monetary shift being prepared in Washington, described as the most significant since 1972. This view, bordering on a financial conspiracy theory, draws on the so-called “Genius Act,” which legalizes stablecoins and is seen by its proponents as a mechanism to distribute U.S. debt globally while undermining gold, long regarded as the final line of defense in the global economic system.

This is a statement that is technically true yet potentially misleading: the stablecoins approved under this law do not conflict with the existing banking system; rather, they are designed to serve a specific role and exert a tangible impact on the economy.

However, the legal framework governing these cryptocurrencies requires them to be backed by cash, bank deposits, or short-term U.S. Treasury bonds with maturities not exceeding three months. As a result, purchasing these currencies effectively constitutes indirect financing of the U.S. government, since a portion of their reserves is invested in these bonds.

The structure of this sector is highly concentrated: two companies control 92% of the total stablecoin market, while ten companies account for 98%, enabling more precise and stringent oversight. The sector’s total value is projected to reach between two and four trillion dollars by 2028.

This scale remains far from posing direct competition to the traditional banking system. Moreover, the “Genius Act” prohibits stablecoin issuers from paying interest to holders, which further limits their ability to compete with conventional banking products.

The role of stablecoins is largely confined to payments, whereas banking institutions are capable of executing thousands of different types of transactions. Nevertheless, technological advances have transformed stablecoins into a new instrument that allows individuals to diversify the forms of cash they hold.

This banking model may appear convincing, particularly since one of its most important pillars of stability lies in backing these currencies with cash and Treasury bonds, as we have repeatedly noted in previous articles.