Chainfeeds Preface:
Circle rises with regulatory advantages and an innovative business model, with its stock price soaring, becoming the core driver of digital dollars.
Article Source:
https://news.marsbit.co/20250619095330166640.html
Article Author:
Mars Finance
Perspective:
Mars Finance: In the early morning of June 19, 2025, the US capital market once again witnessed a feast that will be recorded in financial history: the stock price of stablecoin giant Circle (CRCL) surged 34% in a single day, reaching the $200 mark during trading, creating the largest increase since its listing on June 5. Behind this number is not only the capital's frenzied pursuit of emerging asset classes but also a game of reconstructing monetary sovereignty, financial power, and regulatory order. Just 48 hours ago, the US Senate passed the GENIUS Act (Guiding and Establishing National Innovation for US Stablecoins Act) with an overwhelming vote of 68:30, establishing a federal regulatory framework for US dollar stablecoins. The bill defines stablecoins as digital cash, requiring issuers to reserve 100% high-liquidity assets (such as short-term US Treasury bonds, cash deposits), and prohibiting interest payments to users to strengthen their payment tool attributes. This legislative breakthrough marks the first time crypto assets, which have been in a gray area since Bitcoin's birth, are formally incorporated into the traditional financial system. Compliance premium: The bill brings stablecoin issuers with a market value exceeding $10 billion under Federal Reserve supervision, forcing competitors like Tether to face more stringent audit and reserve requirements, while USDC, with its early compliance advantage (99.5% reserves in US Treasury bonds and cash), becomes the preferred safe haven for institutional funds; Scenario expansion: The bill clearly allows stablecoins for daily payments, cross-border settlements, and other scenarios, breaking the current status where over 80% of transaction volume is concentrated in crypto asset exchanges, paving the way for USDC to penetrate traditional payment networks like Visa and SWIFT; Geopolitical dividend: The bill prohibits non-US dollar stablecoins from entering the US market and mandates foreign issuers (like Tether) to accept equivalent supervision, essentially bringing the global stablecoin market into the US dollar hegemony system. In this context, USDC's circulating volume of $61 billion (29% of the global stablecoin market) becomes a strategic tool for the US to consolidate digital dollar hegemony. Circle's rise is essentially a revolution in the intermediary function of traditional finance. Its core business model can be summarized in three steps: First, mint stablecoins and absorb global US dollar liquidity. When a user buys 1 USDC through platforms like Coinbase, Circle receives 1 US dollar in cash. As of the first quarter of 2025, Circle manages reserve assets of $61.4 billion, with 80% invested in short-term US Treasury bonds and 20% deposited in systemically important institutions like the Bank of New York Mellon. This model generates huge profits during the Federal Reserve's high-interest rate cycle (current 10-year US Treasury bond yield 4.3%): In 2024, Circle's total revenue was $1.676 billion, with 99% coming from reserve interest, with a net profit of $156 million. The second step is to build a payment network, attempting to replace SWIFT's century-long hegemony. Circle's secretly advancing CPN (Circle Payments Network) plan aims to achieve cross-border payment settlement in seconds using blockchain technology, compressing fees to 0.01%. The bill also supports this strategy, requiring stablecoin issuers to connect with the Federal Reserve's real-time payment system FedNow, laying the technical foundation for USDC and digital dollar interoperability. The third step is to devour real-world assets, launching an RWA (Real World Assets tokenization) revolution. Circle collaborates with BlackRock to launch the tokenized Treasury bond fund USYC, converting traditional financial assets like bonds and real estate into on-chain tokens, making USDC a natural settlement medium.
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