GENIUS Act Fails Senate Cloture Over Trump Cryptocurrency Concerns

The Guiding and Establishing National Innovation for US Stablecoins of 2025 Act, commonly referred to as the GENIUS Act, faced a setback in the United States Senate on May 8 when it failed to pass cloture. This bill, introduced by Senator Bill Hagerty and co-sponsored by Senators Tim Scott, Kirsten Gillibrand, Cynthia Lummis, and Angela Alsobrooks, aimed to provide regulatory clarity for digital assets, particularly stablecoins used for payments.

The bill had undergone amendments to address concerns from Senate Democrats, including stricter requirements for stablecoin issuers and additional provisions for Anti-Money Laundering. Despite these efforts, Democrats withdrew their support at the last minute, citing concerns about US President Donald Trump’s cryptocurrency ventures. This move effectively blocked the bill from proceeding, dealing a slight blow to the ongoing efforts to regulate cryptocurrencies in the United States.

The GENIUS Act was intended to be a bipartisan effort to enhance regulatory clarity for digital assets. The focus on stablecoins, which are used for payments, was seen as a way to extend dollar dominance internationally while avoiding more controversial topics within the cryptocurrency space. The bill's failure to pass cloture highlights the ongoing challenges in achieving consensus on cryptocurrency regulation in the Senate.

Following the failed procedure, Senate Majority Leader John Thune expressed frustration with the Democrats, stating, “Democrats have been accommodated every step of the way […] frankly, I just don’t get it.” This comment underscores the deep divisions within the Senate regarding cryptocurrency regulation and the difficulty in reaching a compromise that satisfies all parties involved.

The failure of the GENIUS Act to pass cloture is a significant development in the ongoing debate over cryptocurrency regulation in the United States. The bill's focus on stablecoins and its bipartisan support initially suggested a path forward for regulatory clarity in the digital asset space. However, the last-minute withdrawal of support from Democrats highlights the complex political dynamics at play and the challenges in achieving consensus on this issue.