Senator Warren Warns Billionaires Could Exploit GENIUS Act Loopholes

The GENIUS Act, a bipartisan bill aimed at regulating payment stablecoins, has sparked significant controversy. U.S. Senator Elizabeth Warren has expressed concerns that billionaires like Elon Musk and Jeff Bezos could exploit the system if critical loopholes are not addressed.

Warren's warning has ignited a heated debate within the crypto community and among lawmakers. The GENIUS Act proposes a federal framework for payment stablecoins, outlining rules for issuance and transparency, reserve requirements for stablecoin providers, and clear oversight roles for regulators. The bill has recently cleared a cloture vote and is now headed for a full Senate floor vote, where several amendments are expected to be considered.

Senator Warren took to X (formerly Twitter) to issue a sharp warning, stating, “If Congress doesn’t fix the GENIUS Act, billionaires like Elon Musk and Jeff Bezos could launch stablecoins that track your purchases, exploit your data, and squeeze out competitors.” Warren's statement highlights a key concern: if tech giants gain control over both stablecoin issuance and the platforms on which they operate, it could create a dangerous data monopoly.

Reports suggest that Musk’s company X is exploring stablecoin integration through its X Money initiative, aiming to enable peer-to-peer payments and reduce transaction fees. Speculation is also swirling that Amazon is developing a USD-backed stablecoin to cut costs and streamline online payments. These potential moves by tech titans are exactly what Warren fears—corporate dominance over digital money and consumer data.

Stablecoin transactions are recorded on public blockchains. However, if a corporation controls both the stablecoin and the user platform, it could connect your wallet to your profile, monitor spending behavior in real-time, and use the data for hyper-targeted ads, dynamic pricing, or even sell it to third parties. This raises major privacy and surveillance concerns.

Senator Warren also warned of another risk: bailouts. If corporate stablecoins crash, taxpayers might be on the hook. Adding fuel to the fire, Donald Trump is now tied to a controversial stablecoin project. World Liberty Financial (WLF) was launched in 2024, with Trump serving as “Chief Crypto Advocate” and his sons listed as “Web3 Ambassadors.” A Trump-affiliated entity owns 60% of WLF and receives 75% of revenue. WLF has raised over $550 million and issued a USD1 stablecoin, backed by U.S. Treasuries and cash equivalents. While Trump’s support for crypto aligns with his campaign promises, critics question whether there’s a conflict of interest.

Not everyone agrees with Warren. Fred Rispoli, a pro-crypto lawyer, argues the GENIUS Act could break big banks’ monopoly on consumer data. Others believe corporate stablecoins could boost innovation and financial inclusion. Critics also accuse Warren of hypocrisy for backing a government-run digital currency with similar data risks. Previous concerns around money laundering, foreign coins, and corporate involvement have been partially addressed in the bill, but the privacy debate remains unresolved.

The GENIUS Act is still evolving. As it heads to a full Senate vote, amendments may reshape its final form. However, one thing is clear: the outcome will significantly impact the future of stablecoins in the U.S.—and the power tech giants may (or may not) have over them.