To do just this, the U.S. Senate recently passed the GENIUS Act which would help ensure crypto—particularly stablecoins—are effectively regulated. What does this all mean for the amazing, exciting, developing creative class in SEA? A major step towards legitimacy, or a Western-imposed stranglehold on innovation. The response, like a great batik print, is complicated and full-bodied.
Standardized Crypto: Boon Or Burden?
The GENIUS Act, at its core, is an effort to restore order to the wild west of crypto. Proponents tout consumer protection and industry standards. Fine. But Southeast Asia isn't the Wild West. It’s a region full of artists, artisans & entrepreneurs who have already begun harnessing the power of crypto to work outside unjust financial gatekeepers. Will this standardization give them the power to thrive, or pigeonhole them into categories where they can’t succeed?
Or, consider a traditional weaver in rural Thailand, using NFTs to sell their complex textiles directly to customers in Europe. Or a Nigerian bill poster getting his next collage by fractionalizing ownership of his NFT. These are not just aspirational stories, but rather real stories, made possible by the decentralized, inclusive nature of crypto. Will the GENIUS Act bring them closer to their goal of reaching a wider audience, or will it bury them beneath an avalanche of compliance paperwork?
The fear is real: a one-size-fits-all regulatory approach could stifle the very creativity it intends to protect.
Trump's Shadow: Conflicts Undermine Trust?
The support on both sides of the aisle for the GENIUS Act is a great sign. This is why the prospect of Trump coming into the crypto space is problematic. It’s understandable that critics would be concerned about these potential conflicts of interest. In particular, they point to his ties to World Liberty Financial and its stablecoin, USD1.
Let's be blunt: trust is everything in the crypto world. If Americans perceive the GENIUS Act as a vehicle for the powerful to become even more powerful, it will irreparably destroy trust in it. This is particularly the case in a region sensitive to increased Western influence.
At the same time, Sen. Warren’s criticism that the bill is “even worse than no bill at all” strikes a chord with us. Are we really still protecting consumers, or just deeper making it easier for the well-connected to game the system?
SEA Artists' Voices: Heard or Ignored?
The real litmus test of the GENIUS Act is its effect on the ground in Southeast Asia. Most importantly, have the voices of local artists, developers, and community leaders been heard in the drafting of this legislation? Is this just another case of Western powers using their might to subvert the will of the people? This resulting dynamic could be blind to the region’s special cultural and economic landscapes.
I encourage you to listen to these voices. Discover how artists in Yogyakarta feel about the controversial new regulations. Speak to the entrepreneurs in HCMC who are designing and deploying to the world the next generation of decentralized applications. Hear from the communities of crypto Manila and Bangkok.
Their perspectives are essential. How they choose to implement it will determine whether the new GENIUS Act brings innovation or whether it proves to be a deadening limitation.
How these questions are answered will determine the future of the GENIUS Act. Will it help to empower advocates or make the state the poster child for regulatory overreach.
- Access: Will the GENIUS Act make it easier or harder for artists in Southeast Asia to access global markets through crypto?
- Compliance: Can small-scale creators afford the costs of compliance with these new regulations?
- Innovation: Will the Act encourage or discourage the development of new and innovative crypto applications tailored to the needs of Southeast Asian communities?
Southeast Asian countries are already facing the burdens of figuring out how to regulate crypto. While some—like Singapore—have embraced a relatively progressive approach, others, such as Indonesia, are treading more carefully. How would the GENIUS Act fit in with these existing, detailed regulatory frameworks? Will it create harmony or discord?
Local Regulations: Harmony or Discord?
Or consider the opposite situation in which a Thai artist meets the requirements of the GENIUS Act, but runs afoul of regulations in their own country. This possibility is no longer far-fetched. ASP greatly appreciates the fourth recommendation, which points to the need for thoughtful deliberation and alignment between international and domestic law.
So I support the GENIUS Act with cautious optimism. On one hand, I understand the necessity for consumer protection and industry standards. I fear that prohibitive and counterproductive rules will limit the potential to innovate. This might actually endanger the underserved communities they are intended to save.
The key is balance. What we require instead are regulations that are deliberate, flexible and willing to pivot with the evolving priorities and peculiar circumstances of Southeast Asia. On the federal side, we mustn’t forget to uplift local voices and make sure everybody is able to partake of the benefits that crypto has to offer.
| Country | Existing/Planned Crypto Regulations | Potential Conflict with GENIUS Act |
|---|---|---|
| Indonesia | Restrictions on crypto payments; focus on commodity trading. | The GENIUS Act's focus on stablecoin payments could clash with Indonesia's restrictions, creating uncertainty for businesses operating in both jurisdictions. |
| Philippines | Regulatory sandbox approach; focus on remittances. | The GENIUS Act's prescriptive approach could stifle innovation within the Philippines' regulatory sandbox. |
| Singapore | Comprehensive licensing regime; emphasis on anti-money laundering. | While Singapore's regime is already robust, the GENIUS Act could introduce overlapping requirements, increasing compliance costs for businesses. |
| Thailand | Regulatory framework still developing; focus on consumer protection. | The GENIUS Act could preempt Thailand's own regulatory efforts, potentially imposing a Western framework that doesn't fully address local needs and concerns. |
Cautious Optimism: A Call for Balance
We must not let the GENIUS Act turn into a nightmare for artists from Southeast Asia. Instead, join us to help create a future where crypto promotes expression, drives entrepreneurial success, and expands access to opportunity and inclusion. The time to act is now.
The key is balance. We need regulations that are thoughtful, adaptable, and responsive to the unique needs of Southeast Asia. We need to ensure that local voices are heard and that the benefits of crypto are accessible to all.
Let's not allow the GENIUS Act to become a nightmare for Southeast Asian artists. Instead, let's work together to shape a future where crypto empowers creativity, fosters economic growth, and promotes financial inclusion. The time to act is now.
