Senate Approves GENIUS Act 66-32, Advancing Stablecoin Regulation

The GENIUS Act, which aims to establish standards for stablecoins, has made significant progress in the Senate. On Monday night, the bill received approval by a vote of 66 to 32, representing approximately 3/4 support from the Senate. This vote marks a crucial step forward in the regulation of cryptocurrency, as it cleared a procedural hurdle by securing the necessary 60 votes to end debate and proceed to a full floor vote.

The GENIUS Act, formally known as S. 1582, focuses on setting standards for stablecoins, which are digital currencies pegged to assets like the U.S. dollar. The bill's advancement was bolstered by bipartisan support, with 16 Democrats joining most Senate Republicans in voting to move the measure forward. Key Democrats who changed their votes include Ruben Gallego from Arizona, Mark Warner from Virginia, Lisa Blunt Rochester from Pennsylvania, Kirsten Gillibrand from New York, and Angela Alsobrooks from Maryland.

This vote follows a previous failed attempt on May 8, when the measure lost by a vote of 48 to 49. At that time, Democrats expressed concerns about President Donald Trump’s cryptocurrency businesses, particularly his family’s links to World Liberty Financial, a stablecoin issuer. Following the initial failure, negotiations led to a revised version of the GENIUS Act. The new draft includes provisions to address conflicts of interest, national security, and the role of Big Tech in stablecoins.

One notable change in the revised bill is a rule preventing key officials in the executive branch from issuing stablecoins while in office, although this restriction does not apply to the president and vice president. Additionally, the bill includes a provision that stops Big Tech firms from creating stablecoins unless they have explicit permission from users to handle sensitive financial information. This measure is aimed at companies like Apple, Meta, and Amazon, which could potentially use stablecoins to gain more financial power.

Senator Kirsten Gillibrand, an early co-sponsor of the bill, emphasized that the GENIUS Act protects consumers and fosters innovation. She argued that the legislation helps the U.S. compete in the global digital marketplace. The bill aims to provide issuers with a legal framework, which could attract big banks to the industry and potentially bring billions of dollars into the crypto sector. Industry leaders believe that clearer regulations could encourage major Wall Street firms to enter the stablecoin market.

Despite the progress, some Democrats remain skeptical. Senate Minority Leader Chuck Schumer and Minority Whip Dick Durbin both voted against advancing the legislation, indicating ongoing concerns within the party. Senator Elizabeth Warren, a vocal critic of the bill, argued that it does not adequately address potential corruption and financial risks. She also expressed concerns that the bill could exacerbate issues related to Trump’s cryptocurrency ventures.

Two Republicans, Jerry Moran of Kansas and Rand Paul of Kentucky, also opposed the bill. Paul has previously expressed his dislike for excessive regulations, while Moran’s reasons for opposition were not specified. The Senate will now engage in further discussions and potential amendments to the GENIUS Act. A final vote could occur soon, although some senators suggest it might be delayed until after the Memorial Day break.