Trump Signs GENIUS Act Boosting U.S. Stablecoin Regulation

President Donald Trump signed the GENIUS Act into law on July 18, 2025, at the White House. This legislation provides a comprehensive regulatory framework for stablecoins, potentially enhancing the U.S. position in the global financial market. The GENIUS Act, introduced by President Trump, marks a critical advancement in U.S. crypto regulation. Leaders from major crypto companies attended the signing ceremony, underscoring its significance. The new legislation requires all regulated stablecoins to be fully backed by U.S. dollars or similar liquid assets. Annual audits become a requirement for stablecoin issuers with over $50 billion market cap.

The law's introduction sparks significant changes, increasing legitimacy for stablecoins and encouraging major banks and technology companies to engage with the sector. This development is believed to promote the U.S. as a leader in crypto innovation. President Trump highlighted this sentiment, stating, "This afternoon, we take a giant step to cement American dominance of global finance and crypto technology as we sign the landmark GENIUS Act into law." Dante Disparte from Circle remarked that dollar-based stablecoins provide new ways of moving money outside traditional banking hours. The passage of the act is viewed as a $50 billion boost to the sector. Bitcoin's record highs coincide with the bill’s endorsement.

The GENIUS Act marks the first comprehensive U.S. stablecoin legislation, following various past failed attempts, and paves the way for increased local investment. A growing interest in stablecoins can be expected following this legislation. Historical trends suggest that regulatory clarity could drive institutional investment, uplifting the U.S. crypto market and securely positioning it in global finance.

The GENIUS Act makes it easier for banks and other entities to issue stablecoins, traditionally bought using personal bank accounts to trade for more volatile cryptocurrencies like Bitcoin. The bill passed following a stalemate among House Republicans, which stalled for nine hours before it made it to a debate. Although many Democrats backed the bill, some expressed concerns that it does not stop public officials from pushing their personal coins and profiting from anonymous transactions.

Democratic Rep. Maxine Waters, the ranking member of the House Financial Services Committee, criticized the bill, pointing to a firm with ties to the Trump family that recently launched its own stablecoin and could benefit from the currency being more widely used. A company associated with the Trump family owns a 60% stake in World Liberty Financial, a crypto venture, which launched USD1, a stablecoin pegged to the U.S. dollar, this spring. World Liberty Financial has stated that it is "a private company with no ties to the U.S. government."

The White House has insisted that there are no conflicts of interest in the crypto ventures, stating that Trump's assets are in a trust managed by his children. It will take some time before the public sees changes outlined in the bill. After Trump signs the law, federal regulators will have six months to come up with specific regulations. The House also passed the CLARITY Act, a market structure package that sets the rules for assets that are overseen by the Securities and Exchange Commission or commodities that are regulated by the Commodities Futures Trading Commission. That measure now heads to the Senate.

The GENIUS Act mandates that stablecoin issuers comply with U.S. anti-money laundering and sanctions laws, and requires issuers to hold liquid assets such as U.S. dollars and short-term Treasury bills. This legislation is expected to provide a clearer regulatory framework for stablecoins, potentially boosting their adoption and integration into the mainstream financial system. The signing of the GENIUS Act represents a significant step forward in the regulation of cryptocurrencies, aiming to balance innovation with consumer protection and financial stability.