U.S. stock futures opened higher on Monday, buoyed by the landmark signing of the GENIUS Act—a sweeping new law that for the first time provides a clear federal regulatory framework for U.S. dollar–backed stablecoins. This regulatory clarity reinvigorated investor sentiment across both equity and cryptocurrency markets, with Nasdaq futures rising 0.3% to extend their record‐setting streak. Meanwhile, the cryptocurrency sphere rallied, led by Bitcoin’s surge past the $118,500 mark, as market participants eagerly positioned ahead of major tech earnings from the likes of Tesla, Alphabet, Intel, and Coca‑Cola.
The GENIUS Act—short for “Guiding and Establishing National Innovation for U.S. Stablecoins”—passed the Senate in June, the House with bipartisan support (308–122), and was signed into law by President Trump on July 18. It institutes a federal licensing framework mandating that only approved Permitted Payment Stablecoin Issuers (PPSIs) can mint U.S.-pegged stablecoins. Issuers must fully back coins with liquid assets such as Treasury bills, maintain segregated reserves, subject themselves to monthly attestations, and comply with anti–money laundering statutes under the Bank Secrecy Act.
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President Trump officially signed the act in a White House ceremony alongside executives from Coinbase, Kraken, Gemini, and Robinhood. He celebrated the move as reinforcing U.S. digital asset leadership and supporting global dominance by propping up demand for short-term Treasury debt. Trump quipped that the legislation was aptly “named after me” before praising the bill’s co‑sponsor, Sen. Bill Hagerty.
Industry response was swift. Coinbase and other large crypto exchanges saw stock prices jump on the expectation that regulatory clarity would drive acceptance and usage, facilitate integration with traditional finance, and open new corridors for remittances and global commerce.
Nevertheless, critics cautioned against the downsides, including potential restrictions on smaller-based stablecoin issuers and concerns about centralizing power among Big Tech and fintech players. Regulatory analysts also flagged that lighter regulatory treatment—compared to banks—might carry systemic risks reminiscent of 19th-century “free banking.” Moreover, while the Office of the Comptroller of the Currency (OCC) shows signs of supporting innovation—evidenced by naming former crypto executive Jonathan Gould as its head—the Federal Reserve remains cautious. As of today, only one of 39 non-FDIC insured firms has been granted a master account, raising the question of how quickly these stablecoin issuers can access Fedwire.
Nasdaq 100 futures climbed 0.3% on Monday, extending the index’s record highs amid optimism around corporate earnings and the new stablecoin regime. Futures for the S&P 500 and Dow Jones also rallied, with gains of 0.2% and 117 points, respectively.
Bitcoin led the crypto charge, reclaiming levels above $118,500. Some data outlets attribute an intraday peak beyond $123,000 during Friday’s rally. Ethereum and other tokens saw boosts as well, with Ether up nearly 20% to around $3,500 and the total market capitalization cresting $4 trillion for the first time.
In bond markets, 10-year Treasury yields eased to approximately 4.37% as investors took flight into equities on the heels of the stablecoin optimism.
Despite the upbeat U.S. market tone, the European auto sector took a hit, spurred by reports that Stellantis—parent company of Jeep, Chrysler, Peugeot, Citroën, and Fiat—incurred about €300–350 million in costs during the first half of 2025 from U.S. tariffs levied on EU-manufactured vehicles. The reported loss dragged Stellantis into the red, with a net loss of roughly €2.3 billion ($2.7 billion) during the same period—down sharply from a profit exceeding €6 billion a year earlier.
According to Stellantis CEO Antonio Filosa, the turmoil was compounded by wider restructuring charges, program cancellations, and factory idling across North America. On July 29, Stellantis will release full audited financial results, which analysts anticipate will underscore trade policy’s growing impact on global automakers.
The tariffs—initially set at 25% and later threatened to escalate to 50%—were temporarily delayed in July following dialogue between Trump and European Commission President Ursula von der Leyen. Nonetheless, these duties remain slated to resume on August 1 pending ongoing trade negotiations.
The market is now positioning for Q2 earnings results from heavyweights Tesla, Alphabet, Intel, and Coca‑Cola. The newly enacted GENIUS Act casts a hopeful long-run narrative for fintech and blockchain-infused firms, though macro headwinds—including trade friction with Europe—present short-term challenges.
Analysts from Baird emphasize that elevated earnings expectations, sentiment around rate cuts, and retreating tariff risks are fueling equity valuations. “If the stock market tends to go higher, it’s just impossible to sit out,” said Michael Antonelli. Ongoing trade discussions with Europe—due ahead of an August 1 tariff deadline—will be key; any breakthrough may extend the recent rally, while failure risks dragging down cyclical segments like autos.
Monday’s market movements show a clear bifurcation: bullish momentum in U.S. tech and crypto underpinned by the GENIUS Act’s regulatory clarity, juxtaposed with caution in European industrial sectors, still grappling with tariff-induced losses. As investors digest a key week of earnings announcements and monitor U.S.–EU trade talks, the equilibrium between innovation-driven optimism and macro-policy fragility will likely define market direction well into August.
Source: Reuters
