Stablecoin Bill Faces Delay Amid Trump Ties Concerns

The next steps for the US stablecoin bill, known as the GENIUS Act, are currently under scrutiny following its failure to pass in the Senate on May 8. The bill, which aims to regulate stablecoins, did not garner enough votes due to concerns raised by some Democratic lawmakers about President Donald Trump’s financial ties to the cryptocurrency industry. These lawmakers called for a halt on any digital asset-related legislation until Republicans addressed potential conflicts of interest involving Trump.

Despite the setback, there are indications that the bill could be reconsidered as early as this week. However, there is no consensus on a bipartisan path forward. Following the 48 to 49 vote, Majority Leader John Thune made a motion to reconsider, setting the stage for a potential vote within days. A source familiar with the matter indicated that Republicans backing the bill are unlikely to modify it to prevent Trump or his administration from investing in digital assets, citing constitutional limitations on Congress’s authority.

Liat Shetret, vice president of global policy and regulation at a blockchain analytics firm, noted that this delay is not necessarily harmful. Shetret suggested that the pause could provide both parties with the time needed to clarify provisions and address lawmakers’ concerns, potentially leading to the bill’s return to the floor.

The Cedar Innovation Foundation, an organization linked to the political action committee Fairshake, urged Senate leadership to avoid political maneuvering and pass a stablecoin bill promptly. Fairshake has spent significant funds supporting candidates in the 2024 US elections, some of whom are currently serving in Congress. With more than 500 days until the 2026 midterms, the pressure to address stablecoin regulation remains high.

On May 12, the Senate resumed consideration of the motion to proceed with the GENIUS Act, hinting at another vote in the near future. The outcome of this vote will depend on whether Republicans can secure enough support to clear a 60-vote majority, which is necessary to avoid a Democratic filibuster.

The Trump family’s ties to the crypto platform World Liberty Financial and its stablecoin, USD1, have raised concerns about potential corruption. Additionally, the offer to top holders of the TRUMP memecoin for exclusive access to the president has further complicated the situation. Democratic Representative Maxine Waters criticized the Republicans’ bill for not addressing Trump’s conflict of interest and instead granting him authority over stablecoin regulations.

Democratic lawmakers have proposed legislation to prevent members of Congress, the president, the vice president, and their families from profiting off memecoins. Senators Elizabeth Warren and Chris Van Hollen have called on the president to divest from USD1 before engaging in any deals with foreign governments. These measures aim to address what Democrats have described as a significant corruption scandal involving the White House.