The U.S. Senate passed the GENIUS Act on June 17, paving the way for a federal regulatory framework governing the issuance and use of stablecoins in payments. The bill now moves to the House of Representatives for further review, and if approved, will be signed into law by President Trump. This landmark development has triggered a surge in related stocks and intensified market interest in stablecoins — digital assets designed to maintain price stability through fiat currency pegs.
With regulatory clarity on the horizon, stablecoins are poised to play a transformative role in the future of finance. According to Cathay Asset Management, the stablecoin ecosystem is still in its early stages but holds revolutionary potential for fintech innovation. In Taiwan, only one ETF directly targets this emerging trend: Cathay Digital Payment Services ETF (00909-TW). This fund offers investors exposure to blockchain infrastructure, digital payments, and crypto-related enterprises — positioning them to benefit from the growing on-chain economy.
What Are Stablecoins? Three Key Themes: Risk Mitigation, Payments, and Asset Tokenization
Since their inception in 2014, stablecoins have aimed to solve one of cryptocurrency’s biggest challenges: extreme volatility. Early digital assets like Bitcoin often experienced daily price swings exceeding 90%, making them impractical for everyday transactions or value storage.
Stablecoins address this by maintaining a 1:1 peg with fiat currencies, most commonly the U.S. dollar. Backed by cash reserves or short-term government securities, they offer price stability, near-instant transfers, and low transaction fees. As a result, they’ve become the preferred tool for storing value on blockchain networks and moving funds across borders efficiently.
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Beyond serving as a safe haven during market turbulence, stablecoins are unlocking new frontiers in cross-border payments and real-world asset (RWA) tokenization. Traditional systems like SWIFT can take days to settle international transfers and involve high intermediary costs. In contrast, stablecoin transactions settle in seconds at a fraction of the cost — enabling seamless transfers, such as sending money from Taiwan to Brazil almost instantly.
Looking ahead, stablecoins could democratize access to global investments. Imagine purchasing shares of U.S. equities or fractional ownership in European real estate using digital wallets — without needing local bank accounts or complex compliance procedures. Industry analysts project that the tokenized asset market could grow tenfold within five years, with stablecoins acting as the foundational rails of this new financial infrastructure.
Regulatory Clarity: The GENIUS Act Sets New Standards
The passage of the GENIUS Act marks a pivotal moment in crypto regulation. It establishes strict requirements for stablecoin issuers operating in the United States:
- Full backing by cash and short-term U.S. Treasury securities
- Monthly public disclosure of reserve holdings
- Annual audits for issuers with market capitalizations exceeding $50 billion
- Compliance with KYC (Know Your Customer) and anti-money laundering (AML) regulations
- Authorization limited to approved financial institutions
These safeguards aim to protect consumers and ensure systemic stability while fostering innovation. By setting clear rules, the legislation boosts investor confidence and creates a level playing field for compliant firms.
One company already reaping the benefits is Circle, the issuer of USD Coin (USDC), one of the world’s largest regulated stablecoins. Shortly after its IPO on June 5 at $31 per share, Circle’s stock skyrocketed 675% to $240.28 by June 20 — earning it the nickname “meme stock” due to its explosive price movement.
Circle’s success stems not only from regulatory alignment but also from strategic partnerships. It collaborates closely with Coinbase, the largest U.S.-based cryptocurrency exchange, which serves as a primary distribution and trading platform for USDC. Coinbase earns up to 50% of revenue generated from USDC-related services, including interest-bearing accounts and payment processing.
Additionally, Circle has expanded internationally through a joint venture with SBI Holdings, a major Japanese financial group, bringing USDC to Asia’s institutional markets. Partnerships with traditional finance giants like Visa and Mastercard further integrate stablecoins into mainstream payment networks — allowing merchants to accept crypto payments settled in fiat currency.
Why Cathay Digital Payment Services ETF (00909-TW) Stands Out
For investors seeking diversified exposure to this evolving ecosystem, 00909-TW offers a compelling solution. Managed by Cathay Asset Management, it is Taiwan’s only ETF focused specifically on digital payment technologies, blockchain innovation, and crypto-adjacent financial services.
Key holdings include:
- Coinbase – Leading crypto exchange and USDC ecosystem partner
- Visa & Mastercard – Global payment networks integrating stablecoin rails
- SBI Holdings – Japanese fintech leader driving blockchain adoption in Asia
These companies are central nodes in the expanding stablecoin economy — benefiting from increased transaction volume, regulatory tailwinds, and rising institutional demand.
Fund manager Yang Ting-Jie emphasizes that 00909 is strategically positioned to capture growth across multiple layers of the value chain: from infrastructure and custody solutions to payment gateways and asset management platforms.
As real-world applications expand — including payroll systems using stablecoins, remittance corridors bypassing legacy banks, and tokenized bond markets — the underlying businesses in 00909’s portfolio are likely to see sustained revenue growth.
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The Road Ahead: From Niche Innovation to Global Infrastructure
While still in its infancy, the stablecoin market is rapidly maturing. Total circulating supply has grown from under $5 billion in 2020 to over $160 billion in 2025, reflecting growing trust and utility across retail and institutional users.
Use cases now extend far beyond speculation:
- Multinational corporations use stablecoins for treasury management
- NGOs leverage them for transparent disaster relief funding
- Decentralized finance (DeFi) protocols rely on them for lending and borrowing
- Central banks study them as blueprints for CBDCs (Central Bank Digital Currencies)
With supportive legislation like the GENIUS Act providing legitimacy, and technological adoption accelerating worldwide, stablecoins are transitioning from fringe tools to core components of modern finance.
Frequently Asked Questions (FAQ)
Q: What is a stablecoin?
A: A stablecoin is a type of cryptocurrency designed to maintain a stable value by being pegged to a reserve asset, typically the U.S. dollar. It combines the speed and accessibility of blockchain with price predictability.
Q: How does the GENIUS Act impact stablecoin investors?
A: The act introduces clear rules for issuance and oversight, reducing regulatory uncertainty. This enhances investor protection and encourages institutional participation in the ecosystem.
Q: Is investing in 00909-TW risky?
A: Like all ETFs tied to emerging technologies, it carries volatility. However, its diversified basket of established players in payments and fintech helps mitigate single-company risk.
Q: Can stablecoins replace traditional banking?
A: Not entirely, but they’re becoming complementary systems — especially for cross-border transactions, financial inclusion, and programmable money in digital economies.
Q: Are stablecoins safe?
A: Regulated stablecoins like USDC publish regular audits and hold liquid reserves. However, investors should always verify transparency practices and avoid unregulated alternatives.
Q: How can I invest in stablecoin-related assets outside direct crypto ownership?
A: ETFs like 00909-TW provide indirect exposure through stocks of companies involved in stablecoin ecosystems — offering a regulated, accessible entry point.
The convergence of regulation, technology, and global demand is fueling a new era of digital finance. With stablecoins at its core, this transformation offers long-term investors a chance to participate in the evolution of money itself.