U.S. Senate Passes GENIUS Act: A Step Towards Regulating the Stablecoin Market
The U.S. Senate has taken a significant step towards regulating the stablecoin market with the overwhelming bipartisan passage of the Guiding and Establishing National Innovation for U.S. Stablecoins of 2025 (GENIUS) Act. The 68-30 final vote on Tuesday saw a surge of Democrats joining their Republican counterparts, setting a new high-water mark for crypto policy efforts in the U.S. as the legislation now heads to the House of Representatives. The major Democratic backing for the GENIUS Act gives it momentum as it lands in the other chamber, where House lawmakers can either vote on it as written or pursue changes that will require a final round in the Senate before it can head to President Donald Trump's desk. The bill aims to set up guardrails around the approval and supervision of U.S. issuers of stablecoins, the dollar-based tokens such as those backed by Circle, Ripple, and Tether. Firms making these digital assets available to U.S. users would have to meet stringent reserve demands, transparency requirements, money-laundering compliance, and regulatory supervision that's likely to include new capital rules. Ji Kim, the Acting CEO of the Crypto Council for Innovation, called it a "historic step forward for the digital asset industry" in a prepared statement shared ahead of the vote. "This is a win for the U.S., a win for innovation, and a monumental step towards appropriate regulation for digital assets in the United States," said Amanda Tuminelli, executive director and chief legal officer of the DeFi Education Fund, in a similar statement. While some of the most vocal Democratic critics such as Senator Elizabeth Warren have failed to be convinced, saying it allows loopholes for foreign tokens such as Tether's USDT and doesn't deal with conflicts presented by the personal crypto involvement of President Trump, the bill's backers in her party have essentially argued that doing nothing isn't an option. "With this bill, the United States is one step closer to becoming the global leader in crypto," said Senator Bill Hagerty, the Tennessee Republican who sponsored the bill, as the Senate prepared to vote on Tuesday. "The value of stablecoins will be pegged to the U.S. dollar and backed one-to-one by cash and short-term U.S. Treasuries. This will provide certainty and confidence for more wide-scale adoption of this transformational technology.” While this is the first significant crypto bill to clear the Senate, it's also the first time a stablecoin bill has passed either chamber, despite years of negotiation in the House Financial Services Committee that managed to produce other major crypto legislation in the previous congressional session. The destiny of the GENIUS Act is also tied closely to the House's own Digital Asset Market Clarity Act, which would establish the legal footing of the wider U.S. crypto markets. The stablecoin effort is slightly ahead of the bigger task of the market structure bill, but the industry and their lawmaker allies argue that they're inextricably connected and need to become law together. So far,
