U.S. Senate Passes GENIUS Act Regulating Stablecoins 68-30

The U.S. Senate has passed the GENIUS Act, a significant piece of legislation aimed at regulating stablecoins. This marks the first time the Senate has cleared a major digital assets bill, signaling a notable advancement in crypto policy efforts within the U.S. The bill, officially known as the Guiding and Establishing National Innovation for U.S. Stablecoins of 2025 Act, received overwhelming bipartisan support with a 68-30 vote, indicating a strong push from both Democratic and Republican lawmakers.

The GENIUS Act is now set to move to the House of Representatives, where its future remains uncertain. House lawmakers will decide whether to vote on the bill as is or propose amendments that would require a final round of voting in the Senate before it can be sent to the President's desk. The bill aims to establish guardrails for the approval and supervision of U.S. stablecoin issuers, including stringent reserve demands, transparency requirements, money-laundering compliance, and regulatory supervision. These measures are likely to include new capital rules, ensuring that firms issuing stablecoins to U.S. users adhere to strict standards.

Industry leaders have hailed the passage of the GENIUS Act as a historic step forward. Ji Kim, the Acting CEO of the Crypto Council for Innovation, described it as a "historic step forward for the digital asset industry." Amanda Tuminelli, executive director and chief legal officer of the DeFi Education Fund, echoed this sentiment, stating that it is a "win for the U.S., a win for innovation and a monumental step towards appropriate regulation for digital assets in the United States."

Despite the broad support, the bill has faced criticism from some Democratic lawmakers, including Senator Elizabeth Warren, who argue that it contains loopholes for foreign tokens and does not address conflicts of interest related to the personal crypto involvement of President Trump. Additionally, critics point out that the bill could pave the way for technology giants to issue their own coins. However, supporters of the bill argue that inaction is not an option, and the legislation is a necessary step towards establishing the U.S. as a global leader in crypto regulation.

Senator Bill Hagerty, the Tennessee Republican who sponsored the bill, emphasized the significance of the legislation. He stated that with the GENIUS Act, the U.S. is one step closer to becoming the global leader in crypto. The value of stablecoins will be pegged to the U.S. dollar and backed one-to-one by cash and short-term U.S. Treasuries, providing certainty and confidence for wider adoption of this transformational technology.

While the GENIUS Act is the first significant crypto bill to clear the Senate, it is also the first time a stablecoin bill has passed either chamber. This achievement comes after years of negotiation in the House Financial Services Committee, which has produced other major crypto legislation in previous sessions. The destiny of the GENIUS Act is closely tied to the House's own Digital Asset Market Clarity Act, a more comprehensive crypto bill that aims to establish the legal footing of the wider U.S. crypto markets. The stablecoin effort is slightly ahead of the broader market structure bill, but industry advocates argue that both need to become law together.

The crypto industry's lobbyists are now turning their attention to the House, where both the GENIUS Act and the Digital Asset Market Clarity Act await further action. The passage of the GENIUS Act represents a significant milestone in the regulation of stablecoins and sets the stage for future developments in the crypto industry.