“David Sacks, Trump’s Crypto Authority, Predicts Success for Stablecoin Legislation”

David Sacks, the leading advisor on cryptocurrency and artificial intelligence to US President Donald Trump, mentioned that the administration anticipates the stablecoin legislation to pass the Senate with support from both parties.

“We are fully optimistic now that it’s going to succeed,” Sacks stated to CNBC on May 21, after a significant procedural vote that witnessed 15 Democrats aligning with Republicans to overcome the filibuster hurdle.

The Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act marks the most advanced federal initiative thus far to create a legal framework for digital assets tied to the dollar.

Sacks indicated that the legislation could generate “trillions of dollars” in demand for US Treasurys by facilitating stablecoin expansion under explicit regulations.

“We currently possess over $200 billion in stablecoins — it remains unregulated,” he remarked. “By granting legal clarity, we create immense demand for Treasurys almost instantly.”

Related: GENIUS Act ‘legitimizes’ stablecoins for global institutional adoption

Stablecoin legislation advances amid Trump controversies

The progression of the stablecoin bill occurs despite controversies associated with the Trump family’s cryptocurrency transactions. Critics have expressed concerns that the administration could benefit from this legislation due to its connections to World Liberty Financial, a cryptocurrency firm supported by members of the Trump family that recently introduced a stablecoin, USD1.

The token is supported by US Treasurys and dollar deposits and has secured a $2 billion investment pledge from Abu Dhabi’s MGX fund through Binance.

Sacks, who reported the sale of $200 million in cryptocurrency-related assets before joining the White House, refrained from commenting on whether the president or his family might see financial gains from the bill’s approval.

Despite the momentum, final approval is not assured. Senator Josh Hawley has introduced a contentious clause to the bill that would limit credit card late fees, a change that might jeopardize the legislation’s support from allies within the financial industry.

Related: Hong Kong passes stablecoin bill, poised to open licensing by year’s end

Banks anxious about yield-generating stablecoins

In a May 21 post titled “The Empire Strikes Back,” New York University professor Austin Campbell remarked that the US banking sector is “anxious” regarding the emergence of yield-generating stablecoins, which pose a threat to their profit structure.

Campbell criticized the banking lobby for urging lawmakers to protect their interests and hinder competition from interest-bearing stablecoins.

He asserted that banks depend on fractional reserve practices for profitability while providing minimal returns to depositors, and are concerned that stablecoins may expose and disrupt that framework.