Senate Advances Major Cryptocurrency Legislation With 68-30 Vote

The U.S. Senate has taken a significant step towards finalizing its first major cryptocurrency legislation. On Wednesday, senators began voting on a bill aimed at establishing standards for U.S. stablecoin issuers, successfully clearing the highest procedural hurdle with a 68-30 vote. This move marks a pivotal moment for the crypto industry, as the Senate, known for its slow pace, is now on track to pass the legislation with broad bipartisan support.

Meanwhile, the House of Representatives has also made strides in advancing legislation crucial to the crypto industry. The Digital Asset Market Clarity Act, which seeks to establish a comprehensive set of rules for U.S. oversight of crypto markets, has gained momentum. This bill is seen as vital for the industry's growth and regulation.

The Senate's Guiding and Establishing National Innovation for U.S. Stablecoins of 2025 (GENIUS) Act has undergone multiple revisions and has already received bipartisan approval in several procedural votes. The bill is now expected to pass easily, as it requires a 60-vote threshold to move to the final vote, which was comfortably met with many Democrats joining Republicans in support. The legislation aims to create a regulatory framework for stablecoins, allowing them to be issued under the supervision of state or federal regulators. This includes provisions for non-financial corporations to launch their own coins, a point of contention among Democrats.

Regulating stablecoins is crucial for the functioning of crypto markets, where dollar-based tokens like Circle's USDC and Tether's USDT are commonly used in transactions and contracts. The previous congressional session saw the Democrat-run Senate Banking Committee blocking crypto legislation, but the current Republican chairman, Senator Tim Scott of South Carolina, has become a strong advocate for crypto. The Senate's pro-crypto sentiment has been growing, and Wednesday's votes will further solidify this stance.

Before the vote, Senator Bill Hagerty, the sponsor of the GENIUS Act, urged his colleagues to support the bill, emphasizing its potential to strengthen the U.S. fiscal position and maintain the dollar's status as the world's reserve currency. He warned that inaction could lead to a loss of global competitiveness without a regulatory framework. However, Senator Elizabeth Warren, the ranking Democrat on the Senate Banking Committee, criticized the bill for lacking safeguards to prevent stablecoins from destabilizing the financial system. She argued that the bill allows stablecoin issuers to invest in risky assets and engage in risky activities like private credit or derivatives trading. Warren urged her fellow Democrats to insist on amendments to address these concerns.

Once the stablecoin bill is forwarded to the House, leaders there will decide whether to pair it with the market structure effort or pursue it as a standalone vote. The House will need to match the Senate's approval before the bill can be sent to the president for signing into law. The GENIUS Act's progress follows a day of successes for the Clarity Act in the House, where it cleared the House Financial Services Committee and the House Ag Committee with significant bipartisan support.

Crypto lobbyists and their lawmaker allies argue that both the GENIUS Act and the Clarity Act are essential for properly regulating the crypto industry in the U.S. The passage of these bills would represent a major victory for the industry, providing a clear regulatory framework and fostering growth and innovation.