‘We have hit a wall’: Kevin O’Leary predicts a trillion-dollar crypto rush if Congress passes these 2 bills
Supporting stablecoins
O’Leary says he spends a lot of time in Washington these days, and he’s focused on two bills.
The first, the GENIUS (Guiding and Establishing National Innovation in U.S. Stablecoins) Act, establishes a regulatory framework for stablecoins — digital tokens that are pegged to fiat currencies, which makes them in theory more “stable” than ordinary digital currencies.
O’Leary has said he owns USDC, a stablecoin issued by a company called Circle, which he also owns shares in.
This bill, which analysts say could grow the market to $2.5 trillion, was recently advanced in the Senate after some hiccups and is headed to a final vote. Sen. Elizabeth Warren claims the bill would “accelerate Trump’s corruption” since a firm he backs has its own stablecoin.
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On stage in Toronto, O’Leary gave his best sales pitch on how stablecoins could revolutionize digital payment systems by making money transfers lightning fast and cheaper.
“Currency trading is a multitrillion-dollar market. And it’s old and ugly and inefficient,” said O’Leary, emphasizing that banks “suck fees on both ends” to move capital around the world.
“The biggest threat to that monopoly or oligopoly, if you want to call it that, is a stablecoin that’s regulated.”
He pointed out that stablecoins can also reduce costs for businesses that currently have to pay credit card companies fees on every transaction.
Big Tech is already eyeing it, with Meta reportedly looking for partners, according to Fortune.
Commodity or security?
O'Leary said as soon as the GENIUS Act is passed there will be momentum to pass the second key piece of legislation, which is being called the market structure bill.
Earlier in May, the House Committees on Financial Services and Agriculture released a discussion draft for it. This would create a comprehensive framework for all digital assets, but most importantly, it would define each as a commodity or security.
O’Leary predicted that once this bill passes, “Katie bar the doors, a trillion dollars will come in and index [Bitcoin].”
Whether this is an exaggeration no one can say, but according to an EY and Coinbase survey conducted in January of mainly U.S. institutional investors, an uncertain regulatory environment was the top concern for investing in digital assets, and more clarity was seen as a top catalyst of growth.
The main issues that investors sought clarity on were crypto custody rules (50%), treatment of digital assets as a commodity vs. security (49%) and tax treatment (46%). Twenty-six percent said the treatment of stablecoins and tokenized fiat was the most important area.
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