The US's global leadership in digital finance is under threat due to domestic regulatory restrictions. Faryar Shirzad, director of policy at crypto exchange Coinbase, expressed serious concern that US lawmakers' hardline stance on stablecoins could lead to a geopolitical loss in China's favor.

The GENIUS Act vs. the Digital Yuan

The main stumbling block in the US is the GENIUS Act. Under its current provisions, issuers of US stablecoins are prohibited from charging interest or offering rewards to asset holders. Meanwhile, Beijing is taking the opposite approach.

The People's Bank of China officially announced that, starting January 1, 2026, commercial banks in the country will be permitted to pay interest on deposits in digital yuan (e-CNY). This decision effectively changes the status of e-CNY: from a simple means of payment, it becomes a fully-fledged investment and savings instrument. According to Shirzad, the accrual of returns on the CBDC makes the Chinese digital currency more attractive on the global market compared to the "frozen" returns of American assets.

Risks to Dollar Dominance

A Coinbase representative emphasized that the tokenization of assets is the inevitable future of the global economy. If the US continues to artificially limit the appeal of its stablecoins, investors and users will begin to switch to foreign CBDCs and stablecoins issued outside of US jurisdiction.

Shirzad believes that the Senate's current policy protects the interests of "entrenched players" in the financial sector, but at the same time undermines the dollar's position as the primary unit of account in the digital space. In his opinion, legislators should focus on maintaining the competitiveness of national instruments rather than creating barriers.

Crypto Industry Consolidation vs. Restrictions

Coinbase's position is widely supported in the industry. The Blockchain Association, which represents over 125 companies, is actively calling on Congress to reconsider the ban on yield payments on stablecoins.

The association's representatives argue that depriving stablecoins of the ability to generate income for users makes them uncompetitive in the long term. As the world's second-largest economy (China) integrates bank interest into its digital currency, American regulators risk leaving the US on the sidelines of technological progress. The debate over the GENIUS Act at the end of 2025 is becoming a defining moment for the future of the dollar in the era of tokenization.