Core Viewpoint - The legalization of stablecoins in the U.S. through the "Genius Act" is seen as a strategic move to enhance the liquidity of the dollar and potentially increase its dominance in the global market [1][2][3]. Group 1: Stablecoin Legitimization - The "Genius Act" passed by the U.S. House of Representatives signifies the formal acceptance of stablecoins, moving them from a gray area to a regulated status [1][3]. - The act is interpreted as a tool for the U.S. to solidify the dollar's supremacy and ensure its share in global payments [5][6]. Group 2: Liquidity Implications - The relationship between the dollar and stablecoins suggests that one dollar can generate multiple dollars in purchasing power through the issuance of stablecoins [24][28]. - The mechanism of stablecoins allows for a dollar to be used for transactions while simultaneously being used to purchase U.S. Treasury bonds, effectively doubling its utility [25][26]. Group 3: Impact on Monetary Policy - The introduction of stablecoins could lead to a scenario where the U.S. Treasury can issue debt without direct reliance on the Federal Reserve, potentially altering the dynamics of monetary policy [39][40]. - The expected growth of the stablecoin market from $200 billion to $2 trillion in three years could result in at least $4 trillion in liquidity, significantly impacting asset prices [42]. Group 4: Market Consequences - The influx of liquidity from stablecoins may create new wealth opportunities in certain assets but also risks inflating asset bubbles, particularly in dollar-denominated assets [48][49]. - The potential for the U.S. to shift towards stablecoins as a primary currency raises questions about the future necessity of the dollar [39][40].