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Jeremy Allaire, the CEO of Circle, has been making the same argument for years now: the Securities and Exchange Commission has no business being the primary regulator for stablecoins. His preferred alternative is the same set of banking regulators that already oversee the institutions stablecoins are designed to complement.
The case against SEC oversight
Allaire has been vocal about this mismatch since at least February 2023, arguing that banking regulators are better equipped to handle oversight of products designed to move money, not speculate on value. His logic is straightforward: if stablecoins act like digital dollars in payment systems, regulate them like digital dollars in payment systems.
Circle backs this argument with its own operational posture. USDC maintains full reserves backed by cash and short-term US Treasuries, with independent attestations verifying those holdings. With USDC circulation hovering near $80 billion, Circle isn’t some scrappy startup making idealistic arguments about regulatory philosophy. It’s one of the largest stablecoin issuers on the planet, and its compliance framework already mirrors what banking oversight would demand.
The GENIUS Act changes the game
The most significant validation of Allaire’s position came in July 2025 when the GENIUS Act was signed into law, creating the first US federal regulatory framework specifically tailored for payment stablecoins. The legislation mandates 100% reserve requirements for stablecoin issuers and establishes a supervisory structure that leans heavily on banking-style oversight rather than securities regulation.
Allaire has testified in support of national licensing and federal supervision for compliant stablecoin issuers, essentially advocating for a system where companies like Circle are treated like banks or payment institutions rather than issuers of unregistered securities. The GENIUS Act delivers much of what he asked for.
Circle completed its IPO on the NYSE under the ticker CRCL in June 2025, becoming the first major US stablecoin issuer to go public. One month later, the regulatory framework it had been lobbying for became law.
What this means for investors and the broader market
When the SEC was the de facto arbiter of stablecoin legitimacy, institutional players had good reason to be cautious. Securities regulation comes with disclosure requirements, registration processes, and enforcement risks that don’t map cleanly onto a product designed to maintain a stable one-dollar peg. Banking regulation, by contrast, is built around concepts like reserve requirements, capital adequacy, and consumer protection, all of which actually apply to how stablecoins work.
For Circle specifically, the combination of a public listing and a favorable regulatory framework creates a competitive position that competitors who haven’t invested in the same level of compliance infrastructure must now contend with. Competitors face a choice: spend heavily to catch up or risk being left out of the regulated stablecoin market entirely.
The GENIUS Act’s implementation details will matter enormously. How federal regulators interpret the 100% reserve requirement, how they handle cross-border stablecoin activity, and how they coordinate with state-level regulators could all introduce friction.
Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.
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