Senate Approves GENIUS Act, Advancing Regulations for Digital Currencies with Stable Values
In a significant move towards digital finance innovation, the U.S. Senate has approved the landmark GENIUS Act, establishing a comprehensive regulatory framework for "payment stablecoins." The bill, passed with a vote of 68-30 on Tuesday, aims to provide clearer federal guidelines for digital assets and promote consumer trust.
The GENIUS Act, or the "Giving Regulatory Certainty by Bringing Stablecoins Under the Supervision of Regulators Act," is a crucial piece of legislation that introduces strict consumer protections and establishes uniform standards for qualified entities to issue stablecoins. The law sets a dual federal-state regulatory approach, with the Federal Reserve having oversight.
Consumer protection is a key focus, with stablecoin holders prioritized in insolvency cases and strict marketing rules in place to avoid deceptive practices. The Act also enhances anti-money laundering (AML) and combating the financing of terrorism (CFT) compliance to safeguard the financial system.
If passed, the GENIUS Act will allow businesses and individuals to settle payments nearly instantaneously. Senator Bill Hagerty has stated that the bill's passage will make the U.S. a global leader in crypto.
However, the bill's progress was initially stalled due to Democratic resistance linked to former President Trump's ties to the crypto sector. Several House Democrats have flagged the omission of amendments related to Trump's ties to World Liberty Financial as a potential dealbreaker. The Trump family reportedly has a stake in World Liberty Financial, which launched its own USD1 stablecoin this year.
Despite these concerns, the GENIUS Act cleared the Senate following a prior attempt in May that failed to advance. The U.S. House of Representatives is expected to consider the STABLE Act, companion legislation to the GENIUS Act, next.
Meanwhile, the CLARITY Act, a bill designed to create a comprehensive regulatory framework for digital assets, has been advanced by the U.S. House Agriculture Committee. The advancement of the CLARITY Act reflects growing bipartisan consensus on the need for clearer oversight and defined jurisdiction within the digital asset sector.
Lawmakers anticipate renewed debate over the STABLE Act, with plans to introduce amendments aimed at strengthening oversight, clarifying definitions, and addressing private sector involvement. Several major corporations are actively evaluating stablecoin strategies, and Senators Elizabeth Warren and Richard Blumenthal have formally questioned Meta about a potential stablecoin initiative.
As the digital asset sector continues to evolve, the GENIUS Act represents a major step by the U.S. House of Representatives toward stabilizing and standardizing digital asset regulation in the stablecoin sector, with significant implications for consumer protections, regulatory clarity, and positioning the U.S. as a global leader in digital finance innovation. Information on the STABLE Act was not found in recent legislative updates.
- The GENIUS Act, which aims to provide clearer federal guidelines for digital assets, establishes a framework for regulating tokens like digital stablecoins, a key focus of the bill.
- With the passage of the GENIUS Act, qualified entities may issue tokens under strict consumer protections and uniform standards, potentially enabling businesses and individuals to settle payments more efficiently.
- The CLARITY Act, advancing in the U.S. House Agriculture Committee, seeks to create a comprehensive regulatory framework for digital assets, reflecting growing bipartisan consensus on the need for defined jurisdiction in the digital asset sector, similar to the functions of the GENIUS Act in stablecoins.
