What if I told you that a single piece of legislation just opened the floodgates for big banks and major retailers to create their own cryptocurrency?
That’s exactly what happened when President Trump signed the GENIUS Act on July 18th, 2025: the first-ever stablecoin framework passed by Congress. Banks like JPMorgan and Citigroup have announced plans to jump in, while retailers like Amazon and Walmart are exploring opportunities.
This could create investment possibilities like banks issuing stablecoins with FDIC-like backing, which is way less risky than crypto-native issuers.
But some experts are comparing this to the Free Banking Era of the 1800s, and that didn’t end well for a lot of people.
Before we get into whether this is amazing or terrifying, let’s talk about what actually changed.
What Just Changed by The GENIUS Act?
You know how Bitcoin goes up and down like a roller coaster? Stablecoins are supposed to be the boring cousin that stays put: think digital dollars that don’t make your heart race every time you check the price.
The GENIUS Act creates new rules for a game millions of people are playing with their money.
Before this law, creating stablecoins was like building in the Wild West – no clear rules, no sheriff, just hope for the best. But this bill got massive bipartisan support.
What is a Stablecoin?
So what exactly is a stablecoin? Picture a boat tied to a dock – no matter how rough the waves get, that rope keeps it from drifting away.
Stablecoins work the same way with the dollar. Each coin is supposed to be worth exactly one dollar, always.
Here’s the tricky part. The law creates a dual system we’ve never tried before. Stablecoin issuers with $10 billion or more fall under the Federal Reserve and the Office of the Comptroller of the Currency. Smaller ones get state regulators.
It’s like having two different speed limits on the same highway.
The law forces these companies to keep real money in the vault – actual dollars sitting in actual banks. Plus they need regular audits to prove they’re not printing fake digital money.
They can’t lend out your money or invest it in risky stuff. It’s basically like putting your cash in a safety deposit box instead of letting the bank gamble with it.
Every stablecoin company has to publish monthly reports showing exactly how much real money backs their coins. No more hiding behind fancy accounting tricks.
But now something interesting is happening with who wants to play this game.
The New Players Rushing In
JPMorgan and Citigroup aren’t just thinking about stablecoins anymore, they’re actively planning launches.
Jamie Dimon used to hate crypto, but now he’s saying JPMorgan needs stablecoins to stay competitive. They’re launching something called JPMD for their big business clients.
Jane Fraser at Citigroup is moving in the same direction.
Here’s why this matters to you. These aren’t random startups anymore. These are the same banks that already handle your mortgage and credit cards.
Think about who else is jumping in. Amazon and Walmart are exploring stablecoin opportunities according to reports from the Wall Street Journal and Reuters.
Your grocery store chain might start offering digital dollars soon. Gas stations, coffee shops, maybe even your local pharmacy.
This creates a huge competitive advantage. Established companies with deep pockets can now play in crypto legally. They don’t have to worry about unclear rules anymore. They can hire lawyers, build proper systems, and actually compete.
You might soon buy stablecoins from companies you already trust. Instead of some random crypto exchange, you could get them from your regular bank. Or maybe from Amazon when you’re buying groceries online.
JPMorgan already has experience with blockchain technology. They built their own system called JPM Coin for moving money between big institutions. Now they can expand that to regular customers.
These companies can offer things crypto startups can’t. Like FDIC-like protections on the cash reserves backing their stablecoins – though the digital coins themselves won’t be insured, and they can’t pay interest under the Act. Plus customer service that actually answers the phone.
The OCC is already preparing to move fast on implementation. They’re not waiting around to get this started.
Big banks have something else going for them. They already know how to handle massive amounts of money safely. They have the infrastructure, the security systems, and the regulatory experience.
But with big names rushing in, some experts are looking at history and getting nervous about what could go wrong.
The Risks Nobody Wants to Talk About
Experts are warning that this could recreate the chaos of the Free Banking Era from the 1800s.
Back then, states let almost anyone open a bank and print their own dollars. Different bank notes had different values, shopkeepers couldn’t tell real money from fake, and the whole system fell apart.
Here’s the nightmare scenario nobody wants to talk about: a stablecoin run. Imagine everyone trying to cash out their stablecoins at once. It’s like a bank run but faster. Way faster.
Your phone buzzes with news that one stablecoin company might be lying about their reserves. Within minutes, millions of people are hitting the sell button.
Panic spreads in minutes via social media, just like we saw with Silicon Valley Bank in 2023. When one stablecoin fails, it triggers fear about all the others.
The confusion factor makes everything worse. Too many different stablecoins could make payments messy and unreliable.
Your coffee shop takes JPMorgan’s stablecoin but not Citigroup’s. Amazon accepts one type but your grocery store wants another. It’s like having fifty different kinds of dollars that shops may or may not accept.
Government intervention might be needed to prevent total collapse. That means taxpayers could end up bailing out failed stablecoin companies. We’ve seen this before with Silicon Valley Bank. Regulators stepped in with taxpayer money to prevent a bigger crisis.
How Does This Impact You and Your Investments
This connects directly to your portfolio.
Market volatility from stablecoin instability could affect all your crypto investments. When people lose confidence in digital dollars, they usually lose confidence in Bitcoin and everything else too.
One stablecoin collapses, fear spreads to others, people start selling all their crypto, and prices crash across the board.
If regulators can’t catch every weak balance sheet, the whole system could wobble.
The GENIUS Act: What Should You Do?
So what does this all mean for you?
The GENIUS Act means trusted names like JPMorgan and Citigroup can issue digital dollars, promising convenience and oversight. But history shows us that multiple money issuers create confusion, and market fragility demands serious caution.
Here’s your move:
- Watch for announcements from major banks and keep an eye on how the Fed and OCC actually implement this in the coming weeks. Execution, not just the law itself, will determine whether this works.
- Keep some savings in places you know are rock solid until we see how this regulatory experiment plays out.
- Spread your investments across different types and issuers.
Think about it. We’re witnessing the birth of a new financial system. You get to decide how much you want to be part of this experiment while it’s still unfolding!