Circle shares fall nearly 20% after CLARITY Act is signed in the U.S.
Shares of Circle Internet Group Inc, the operator of the USDC stablecoin, fell by 19.06% to $102.50 on March 24 following the signing of the CLARITY Act in the United States, which provides for no yield for stablecoin holders. This decision is expected to complicate the creation of savings-oriented financial instruments based on USDC and other stablecoins.
The new CLARITY Act has become a serious challenge for the stablecoin market, as it prohibits earning profits directly from holding these digital assets. This is likely to restrain the development of innovative financial products based on stable cryptocurrencies such as USDC.
At the same time, Circle’s competitor, Tether — the largest stablecoin by market capitalization — has stepped up its efforts. The company has signed a contract with one of the “Big Four” accounting firms to conduct its first international audit, which could strengthen trust in its platform.
Circle Internet Group Inc, founded in 2013, is known as one of the key players in the stablecoin sector, particularly as the issuer of USDC, a popular digital dollar. The company aims to make cryptocurrencies safer and more convenient for widespread use in financial transactions.
Overall, legislative changes in the United States are creating new regulatory barriers for the stablecoin market, forcing participants to adapt to new conditions or seek alternative paths for development. This may delay the rollout of innovative services focused on capital preservation.
In the long term, the situation will push companies to find a balance between regulatory requirements and user needs, which will shape the future development of the cryptocurrency segment of the financial market.
It was also previously reported that Turkey is considering using its foreign exchange and gold reserves to support the lira.
