U.S. GENIUS Act: Small caps that will benefit from the new stablecoin regulation

In early April, the House Financial Services Committee voted to advance a U.S. stablecoin bill. By July, it had passed both chambers of Congress and was signed into law by President Trump. The GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins) is the first federal regulatory framework in U.S. history for stablecoins, which are dollar-backed digital assets designed to maintain a fixed value.

The bill simplifies the legal and tax environment for tokenization companies, ends years of regulatory uncertainty, and supports the growth of the crypto industry. The immediate result was a surge in demand for tokenization infrastructure: as early as April, shares of specialized firms jumped on expectations that clear federal rules would draw massive investment in the sector.

As of Wednesday, September 24, the global market capitalization of stablecoins was at $294 billion, up 25.4% since the beginning of April. U.S. Treasury Secretary Scott Bessent projects the figure could rise to $2 trillion in the coming years. Stablecoins and the tokenization of real-world assets have already become a structural trend. A striking example is the successful IPO of Circle, the issuer of one of the world’s most widely used stablecoins, USDC.

To track the performance of stablecoin companies, analyst Aldiyar Anuarbekov put together for Oninvest an index of 19 small-cap public companies directly or indirectly involved in this ecosystem. The equal-weight index – what he calls the Stable 19 EW Index – includes issuers, exchanges, custodians, market makers, blockchain integrators and funds working with stablecoins. The index rebalances monthly.

The starting point for the index was 2020, when the Office of the Comptroller of the Currency first authorized U.S. national banks and financial organizations to hold crypto assets and maintain dollar reserves for stablecoins. In October of the same year, PayPal allowed millions of its users to buy and hold crypto. Over nearly five years, the Stable 19 EW has exhibited high volatility. It gained 36.0% in 2023 and 37.4% in 2024. In the first eight months of 2025, the index has more than doubled, gaining 114% (as of September 12). For comparison, over the same period the MSCI World Small Cap index advanced 16.6% and the Russell 2000 less than 10.0%.

Notably, only 11 of the 19 companies in the Stable 19 EW index have posted gains this year, while eight recorded losses. Among the top performers is DeFi Development Corp., an AI-powered online platform connecting borrowers and lenders in the commercial real estate market, which has seen its shares skyrocket more than 2,000%. Shares of OSL (formerly BC Technology Group), an operator of a licensed crypto exchange in Hong Kong, have risen 95%, while payment provider Banxa Holdings is up 30%. The fintech Marqeta, which specializes in issuing cards (including for crypto wallets), has added 54%.

The laggards were firms whose revenue is largely unrelated to stablecoin settlement volumes or tokenization, meaning regulatory changes were not share price drivers. For example, the U.S. fintech Ryvyl has plummeted 77% since the start of the year, while French payment operator Worldline is off 64%.

OSL Group

Hong Kong–based OSL Group, formerly BC Technology Group, is one of the beneficiaries of the stablecoin boom. Since the beginning of 2025, the company’s shares have gained nearly 90%, including a 79% increase since April. OSL was one of the first licensed virtual asset trading platform operators in Hong Kong, and the first public company to receive such a license. It serves institutional clients as a broker, exchange, and custodian, while also expanding into the stablecoin segment – advising issuers and participating in the Hong Kong Monetary Authority’s e-HKD pilot program.

OSL’s business accelerated in the first half. Earnings from digital asset transactions surged as client volumes nearly tripled, rising almost 200% year on year to HKD68 billion, while assets in custody approached HKD6 billion. IFRS revenue reached HKD195 million, up 58% from a year earlier.

Despite this growth, OSL’s stock looks overvalued. The shares are trading at a P/E of about 210, compared with a sector median of 21.41. Four analysts cover the company, all with "buy" or "overweight" ratings, according to FactSet. Their average target price implies upside of about 30% per share.

WisdomTree

U.S.-based WisdomTree illustrates how a traditional asset manager can adapt to the new reality. Known as an ETF provider, the company has become a pioneer in tokenized funds. It has launched its own dollar stablecoin, USDW, and rolled out a tokenized money market fund, WTGXX, accessible via a mobile app.

As of end-July, WisdomTree’s tokenized products had amassed about $486 million in assets under management, up from just $12 million at the start of the year. The total market for tokenized funds stood at $28 billion as of September 13, according to data provider rwa.xyz.

WisdomTree shares have climbed 51.5% year to date, including nearly 40.0% since April. On August 18, Morgan Stanley raised its target price to $12.50 per share and reiterated its "equal weight" rating. Analysts noted that token initiatives could unlock new long-term revenue streams if the company controls costs. According to MarketWatch, six analysts track the stock: four recommend "buy" versus two who have "hold" calls. Their average target price of $14.46 per share is nearly identical to the current share price.

DeFi Development Corp.

DeFi is actively working with stablecoins, integrating them into its solana blockchain–based ecosystem. In August, the company partnered with Global Dollar Network, joining its USDG stablecoin platform.

In practice, DeFi is an investment company with a strategy of accumulating crypto assets. It systematically builds reserves in the solana token, betting on both price appreciation and the growth of the blockchain’s ecosystem. DeFi already holds more than 1.3 million SOL (about $260 million), equal to 0.044 SOL per share. The company’s goal is to raise this to 0.165 SOL per share by June 2026.

DeFi’s shares have soared more than 2,000% year to date per share, coming off a 41% decline in 2024. In an August note, investment bank Craig-Hallum cited DeFi’s strategy as a positive factor backing a 20% target price upgrade to $30 per share and a "buy" rating. The target implies the stock could double from current levels. According to MarketWatch, two analysts cover DeFi, both with "buy" recommendations. Their consensus target price is $34.50 per share, more than twice the current price.

The AI translation of this story was reviewed by a human editor.