Trump Signs GENIUS Act to Regulate Stablecoins, Citing Global Trends

President Donald Trump signed the GENIUS Act into law on July 18, 2025, marking a pivotal moment in U.S. digital asset policy by establishing the first federal regulatory framework for stablecoins. This legislation sets new capital and reserve requirements for stablecoin issuers, aiming to enhance oversight in a rapidly growing sector. The act aligns with global regulatory trends such as the European Union’s Markets in Crypto-Assets (MiCA) framework and Japan’s evolving digital asset policies [1].

The GENIUS Act mandates that stablecoin issuers adhere to strict financial regulations, including prohibitions on offering interest or yield to holders. This measure seeks to prevent private entities from providing de facto banking services without the same level of oversight applied to traditional financial institutions. Treasury Secretary Scott Bessent highlighted the act’s role in securing the global financial system and expanding access to digital dollars [2].

One of the law’s immediate impacts is an increased level of accountability for stablecoin issuers, particularly regarding capital and reserve management. The compliance deadline is set for January 2027, giving industry participants time to adjust their operations accordingly. Experts anticipate that the law could lead to market stabilization as non-compliant issuers exit, though liquidity shifts may occur during the transition [3].

The U.S. Treasury has launched a public comment period to shape the implementation of the GENIUS Act, seeking input from stakeholders on how to detect and prevent illicit financial activities involving digital assets. This process is part of the administration’s broader strategy to strengthen America’s leadership in the digital asset space while managing the risks of unregulated systems. The President’s Working Group on Financial Markets has also urged the Treasury to accelerate the development of tools and frameworks to regulate permitted payment stablecoin issuers [4].

The law’s passage reflects a broader trend of heightened regulatory scrutiny in the U.S. cryptocurrency sector. Policymakers are balancing innovation with risk management, ensuring that the digital asset market operates within a secure and transparent legal framework. The ongoing implementation process will be closely watched by industry experts and regulators, as the act defines the legal boundaries between traditional finance and digital asset offerings [5].

The impact of the GENIUS Act will depend largely on how the regulations are finalized and enforced. While it introduces clarity and stability, it also presents challenges for smaller market participants. As the Treasury incorporates public feedback, the final rulemaking process will play a critical role in determining the future of stablecoins in the U.S. and their broader role in the global financial ecosystem [6].

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Source:

[1] "U.S. Treasury Issues Call for Public Comment on Illicit Activity Following Trump Signing GENIUS Stablecoin Act Into Law" (https://www.theblock.co/post/367291/us-treasury-issues-call-for-public-comment-on-illicit-activity-following-trump-signing-genius-stablecoin-act-into-law?utm_medium=rss&utm_source=policy.xml)

[2] "Request for Comment on Innovative Methods To Detect Illicit Activity Involving Digital Assets" (https://www.federalregister.gov/documents/2025/08/18/2025-15697/request-for-comment-on-innovative-methods-to-detect-illicit-activity-involving-digital-assets)

[3] "Treasury Seeks Comments on Benefits, Risks of GENIUS Act" (https://www.pymnts.com/cryptocurrency/2025/treasury-seeks-comments-on-benefits-risks-of-genius-act/)

[4] "U.S. President's Working Group Issues Report Outlining Key Recommendations" (https://www.jdsupra.com/legalnews/us-president-s-working-group-issues-6658575/)

[5] "Treasury Requests Comment on GENIUS Act" (https://www.accountingtoday.com/news/treasury-department-requests-comment-on-genius-act)

[6] "US Treasury Advances GENIUS Act Mandate, Seeks Public Input on Stablecoin Regulation" (https://cryptobriefing.com/stablecoin-regulation-genius-act)