The landmark US GENIUS Act may function a significant catalyst for stablecoin adoption each domestically and overseas. But fairly than merely boosting demand for dollar-backed digital currencies, it could unintentionally push capital into the tokenization market as traders search yield on their holdings.
That was one of many key takeaways from a latest interview with Will Beeson, a former Standard Chartered govt and now founder and CEO of Uniform Labs, a developer of institutional liquidity options for tokenized monetary markets.
A central provision of the GENIUS Act is its blanket ban on yield-bearing stablecoins, which prevents holders from incomes curiosity on their digital greenback balances. According to Beeson, this restriction will speed up the circulate of capital into tokenized real-world property (RWAs).
“With yield-bearing stablecoins off the desk, establishments want a compliant method to earn yield whereas staying liquid,” Beeson advised Cointelegraph. “Capital is already shifting.”
He famous that trillions of {dollars} in non-interest-bearing stablecoins are poised to enter digital finance. “Institutional holders aren’t going to take a seat on idle, depreciating property. They’ll demand yield — and infrastructure that makes accessing it […] compliant,” he mentioned, including:
“The subsequent part isn’t about holding idle stablecoins. It’s about programmatic entry to risk-free yield, and the power to maneuver between money and high-quality property at will.”
Beeson’s view is shared by Aptos Labs’ Solomon Tesfaye, who advised Cointelegraph that the GENIUS Act will profit tokenization as a lot because it does stablecoins.
To meet this want, Beeson’s Uniform Labs is constructing Multiliquid, an institutional liquidity layer for tokenized markets that permits programmable, real-time conversion between tokenized property, corresponding to US Treasurys and cash market funds, and stablecoins.
Multiliquid’s open-architecture design permits compliant issuers to combine with out industrial agreements.
While declining to call companions, Beeson confirmed that Uniform Labs is “working with quite a lot of main establishments, fintechs, and stablecoin issuers” forward of its manufacturing launch later this 12 months.
Before launching Uniform Labs, Beeson served as chief product officer at Libeara, a tokenization platform incubated by Standard Chartered’s SC Ventures.
Related: Tokenized cash market funds emerge as Wall Street’s reply to stablecoins
Tokenization surge to broaden past non-public credit score, authorities bonds
Although the GENIUS Act provides newfound legitimacy to stablecoins — and to digital currencies extra broadly — “the subsequent part of digital property is targeted on asset tokenization,” wrote Sandra Waliczek, a member of the World Economic Forum’s blockchain and digital asset division.
Waliczek highlighted tokenization’s potential to stage the investing taking part in subject for asset lessons like actual property and personal fairness, which have traditionally been restricted to wealthier traders.
“Tokenization modifications this by enabling asset fractionalization, breaking property into smaller, extra inexpensive models,” she wrote.
So far, the practically $26 billion tokenization market has largely centered on non-public credit score and authorities bonds. But as Beeson famous, the disruption will prolong far past these segments, encompassing “company bonds, credit score and credit score funds, commodities, equities, actual property funds, non-public fairness funds, and finally non-public fairness and actual property property themselves.”
Related: GENIUS Act scrutinized for stablecoin yield ban as TradFi tokenization positive factors steam
