Senate Votes on GENIUS Act Amid Political Divisions

The US Senate is set to vote on the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act today at approximately 8 P.M. EDT. The outcome of the vote remains uncertain, as the bill has faced significant hurdles due to political divisions among lawmakers.

The GENIUS Act aims to create a federal regulatory framework for payment stablecoins. However, its progress has been stalled in recent weeks due to disagreements among senators. A procedural vote held over a week ago failed, with all 49 Democratic senators blocking a motion to invoke cloture on the bill’s consideration, effectively halting its initial path to the floor.

Following the failed vote, there were reports of a bipartisan effort to revise the bill for another vote. This effort resulted in changes to the proposal that were initially denied. Despite these efforts, the bill continues to face opposition from Democrats who argue that the latest draft contains broad loopholes for political figures and tech companies, creating security risks and insufficient consumer protections.

A memo released by Senate Banking Committee Democratic staff on May 19 accused the latest draft of enabling “Trump crypto corruption.” The memo highlighted provisions that fail to bar elected officials, including President Donald Trump and his family, from owning or profiting from stablecoin ventures. It also warned of expanded loopholes for offshore issuers and private big tech firms, which could make it easier for criminals to move funds into the US financial system.

The memo further argued that the draft allows companies not predominantly engaged in financial services to issue their own stablecoins, with Elon Musk’s X mentioned as a potential beneficiary. It also stated that the exemption for private issuers undermines existing prohibitions on corporate currency issuance and poses systemic financial risks. The memo concluded that the draft’s updates are “fig leaves,” restating existing protections without materially addressing national security concerns, sanctions enforcement, or misleading marketing by issuers.

In contrast, bill proponents, including Senate Republicans, industry groups, and some moderate Democrats, view the GENIUS Act as a necessary legislative foundation. Sen. Bill Hagerty (R-TN), the bill’s sponsor, described the legislation as pro-growth and “the first ever regulatory framework for payment stablecoins.” He argued it would strengthen the US dollar, increase demand for Treasury assets, and keep innovation onshore.

Bo Hines, executive director of the President’s Council of Advisers for Digital Assets, also voiced support, saying the legislation would modernize the financial system and provide Americans with faster and more affordable payment tools. Amanda Tuminelli, executive director and chief legal officer of the DeFi Education Fund, issued a statement urging bipartisan support, claiming regulatory clarity for stablecoins is in the best interest of the US dollar, American consumers, and small businesses.

Ji Kim, acting CEO of the Crypto Council for Innovation, said on May 19 that the vote is “a critical step to establish a regulatory framework for stablecoins that fosters responsible innovation” and that the legislation is essential for preserving US leadership in digital finance. Support has also come from advocacy organizations like Stand With Crypto, which declared the Senate vote a “key vote” for its 52 million American members and urged constituents to pressure senators to back the bill.

Justin Slaughter, VP of regulatory affairs at Paradigm and a former Democratic staffer, offered a pragmatic endorsement, saying that this is “close to the best we can get for years and years.” Slaughter added that while the bill isn’t perfect, it addresses the regulatory void surrounding stablecoins and mirrors the approach adopted by other major economies.