New data from Galaxy Digital’s Head of Research, Alex Thorn, dismantles the banking industry’s primary argument against the GENIUS Act stablecoin framework. Thorn’s model projects that 60–70% of stablecoin growth under the legislation will originate offshore, meaning the majority of new capital will not come from domestic depositors. Imported deposits from offshore will exceed domestic deposit migration roughly 2:1, contradicting claims that stablecoins will drain U.S. bank deposits.
Each newly minted GENIUS-compliant stablecoin is expected to generate approximately $0.32 in net U.S. credit expansion. Galaxy’s base case forecasts $400 billion in stablecoin-related credit expansion by 2030, with a bull case reaching $1.2 trillion. The model also shows structural support for U.S. Treasury yields: mandated high-quality reserve holdings will compress short-term yields by 3–5 basis points, potentially reducing government borrowing costs by up to $3 billion annually. Tether, already holding over $120 billion in T-bills, exemplifies the scale of demand this regulation formalizes.
Separately, at Consensus Miami 2026, executives from MoonPay, Ripple, and Paxos emphasized that while the GENIUS Act has accelerated institutional adoption, significant infrastructure and privacy gaps persist. MoonPay VP Richard Harrison described the law as a “regulatory permission slip” that brought traditional finance into stablecoins but cautioned that everyday utility—like paying rent or buying coffee—still depends on missing infrastructure. Ripple SVP Jack McDonald noted institutional clients are focused on compliance and custody, with cross-border settlement as the primary use case. Paxos engineer Brent Perrault warned that unresolved privacy issues on public blockchains remain a major barrier to enterprise-scale stablecoin payments. The stablecoin market now sits at approximately $317 billion, with Western Union’s recent entry via a Solana-issued stablecoin underscoring the trend of traditional players capitalizing on regulatory clarity.
