Stocks tied to cryptocurrency surge forward following Trump's approval of stablecoin legislation
The Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act), signed into law on July 18, 2025, is set to have a profound impact on the cryptocurrency market, particularly on stablecoins, Ether, and crypto-linked companies.
### Stablecoins
With the introduction of a comprehensive framework for payment stablecoins, the Act requires issuers to be "permitted payment stablecoin issuers" or comply with comparable foreign regulations. This regulatory clarity is expected to stabilize prices, as stablecoins will be backed 1:1 with cash, U.S. Treasuries, or other high-quality assets, thereby enhancing consumer confidence. The regulatory framework could lead to more stable and predictable prices for stablecoins, thereby reducing volatility and increasing trust in the stablecoin market.
### Ether and Other Cryptocurrencies
The GENIUS Act could potentially create a structural advantage for scalable, utility-driven altcoins like Ether, as it provides regulatory clarity that may attract institutional investors. This could drive up demand and prices for these assets. The shift towards scalable blockchain platforms and utility-driven tokens may favor assets like Ether, which have a strong ecosystem and real-world applications. However, Bitcoin, being less scalable compared to some altcoins, might face different market dynamics.
### Crypto-Linked Companies
Companies involved in crypto services, such as exchanges and custodians, will need to comply with the new regulations. This clarity can help these companies operate more securely and attract more institutional participation, potentially benefiting their stock prices. However, the regulatory requirements may also increase compliance costs for these companies, which could initially impact profitability. In the long term, a clearer framework can lead to more stable and secure operations, potentially enhancing investor confidence.
In summary, the GENIUS Act is expected to stabilize the stablecoin market through stricter regulations, potentially favoring scalable altcoins like Ether, and influencing the operational environment for crypto-linked companies.
Interestingly, the bill bans yields or interest payments on regulated stablecoins. This ban seems to be contributing to a rise in Ether prices, as suggested by Deutsche Bank. Ether prices scaled their highest this year following Trump's signature on the GENIUS Act.
Shares of crypto-holding companies such as BitMine, Bit Digital, BTCS, and SharpLink Gaming were on the rise on Monday, with BitMine's shares advancing 4.7 per cent. The chairman of BitMine is Tom Lee from Fundstrat.
Gautam Chhugani, senior analyst at global digital assets, Bernstein, stated that banks, payments players, and fintechs would continue buying operational ETH to pay transaction fees for deploying stablecoins and tokenized assets on the blockchain.
Stablecoins, digital currencies designed to maintain a constant value, usually a 1:1 U.S. dollar peg, have seen explosive growth, mainly due to crypto traders moving funds between tokens. Other cryptocurrencies, such as XRP, Solana, and the ProShares Ultra Solana ETF, have also seen significant gains following the passage of the GENIUS Act.
The GENIUS Act's ban on yields or interest payments on regulated stablecoins could lead to an increase in Ether prices, as suggested by Deutsche Bank. This rise in Ether prices was evident following Trump's signature on the Act this year. Additionally, the expected regulatory clarity for crypto-linked companies might boost the stock prices of companies like BitMine, particularly with Tom Lee, their chairman, at the helm.
