Core Viewpoint - The enactment of the "U.S. Stablecoin Innovation Act" marks a significant shift in the regulatory landscape for stablecoins, establishing their legal status and integrating them into the federal financial regulatory framework, which is expected to reshape global capital flows and influence international monetary rules [3][4][6]. Summary by Sections U.S. Stablecoin Act Intent - The U.S. Stablecoin Act aims to assert control over global capital flows by providing legal backing for the issuance, settlement, and clearing of dollar-backed stablecoins by licensed entities and cross-border clearing networks [3][4]. Definition and Market Overview of Stablecoins - Stablecoins are digital assets pegged to fiat currencies, primarily the U.S. dollar, with over 95% of their market value tied to the dollar. As of July 2025, the total market value of stablecoins reached $263.6 billion, with USDT and USDC dominating the market [5][6]. Impact on International Capital Flows - The U.S. Stablecoin Act is expected to accelerate the restructuring of international capital flows by simplifying cross-border transactions through blockchain technology, reducing costs by over 60% and settlement times from days to minutes [9][10]. Changes in Capital Flow Types - The stablecoin network may lead to an increase in short-term speculative and arbitrage capital, while long-term investment capital may shift towards more liquid dollar assets. Additionally, shadow capital flows may increase, bypassing official statistics and capital controls [11]. Concentration of Global Capital - The dollar's dominance in stablecoin transactions is likely to enhance the U.S.'s ability to attract global capital, with stablecoin reserves typically held within the U.S. financial system, thereby increasing demand for U.S. assets [12]. Systemic Risks and Emerging Market Concerns - The concentration of stablecoin market share among a few players poses systemic risks, while the informal dollarization in emerging markets could lead to financial instability and challenges for local monetary policies [12][13]. Future Global Financial Dynamics - The implementation of the U.S. Stablecoin Act is anticipated to foster a dual-track global financial system, with a U.S.-led private stablecoin network and various central bank digital currencies (CBDCs) emerging as alternatives to maintain monetary sovereignty [14][15].