It becomes clearer, the more I research Meta's views, that it will issue a stablecoin once the legislation is complete. There will naturally be hurdles to overcome but I am convinced the chances of it not going down this path are almost zero.
This does not mean it will gain approval. There is likely to be strong opposition, as evidenced by the Senators to took Zuckerberg to the carpet in his hearing before them.
That said, we can expect the company to make moves that will enhance its ability to get into this arena. It is one of the components that will push stablecoin issuance into the trillions.
When that happens, $250 billion will seem like a small number.
Most major financial and technology companies will head down this path. We are going to see a stablecoin boom like we never expected. My prediction is that dozens of companies will enter within the first 6 months of passage by the United States government.
As an aside, the US Senate is set to vote on the GENIUS Act this week.
This is for European trading and will fall under MiCA. Thus, it is not affected by the legislation in the United States.
What is interesting is that a French bank is launching a dollar-pegged stablecoin. This exemplifies how USD stablecoins will continue to dominate.
My expectation is that most large banks will enter the market. They will, in many instances, issue stablecoins in the local currency. However, all will get involved with USD stablecoins also.
It instantly gets them on the global stage, allowing for interaction with most any institution via simple swaps.
Financial institutions gain automatic entry. Big Tech is not afforded the same option according to the bill the Senators are voting upon. Meta will require a waiver to become a stablecoin issuer.
The company went down this path once before. Although the situation changed, the question did not.
While the cryptoasset landscape and policy outlook for crypto projects has definitively shifted to a more permissive stance the very same issues that were raised during 2019 loom large as Meta returns to the stablecoin marketplace. Specifically, the letter from the Senators cited the track record of privacy violations, scams, and fake news that continue to occur on the platform as risks that a native stablecoin could amplify.
Can the company overcome this pushback? It does not have a great track record in this area, something most are well aware of.
Money is fuel for the economy. In an era where AI agents will become the norm, massive expansion is required.
Crypto is the only monetary component that can keep up with the rapid change. Stablecoins increase competition allowing newer entrants into the process of expanding the money supply. No longer will the economy be depended upon the commercial banking system.
Of course, freedom from banks is not part of the process. The legislation is guaranteeing these institutions are involved. Nevertheless, a great deal of the expansion can occur as debt is used as the backing agent. This increases the total dollar transactional value with each stablecoin issued adding 80 cents more.
The digitization of the world changes everything. When it comes to economic productivity, we are seeing the numbers skyrocket. The reason why much of this gets missed is the deflationary nature of technology. We end up getting more for less over time.
If we simply look at information, with the addition of chabots, think about the access people have for basically nothing. By considering the ability to have AI agents built on top, we can see how goods and services change completely.
Meta is a platform that can assist in this. It is dealing with billions of people on a monthly basis. It is easy to see the direct value the company generated, simply by looking at the market cap. However, if we progress to things such as the marketplace and other commercial services, we can see it serving as infrastructure.
With so much at stake, I find it difficult to believe that Meta is not going to enter this market, especially in light of its actions 5 years ago where it tried with Libra.
