GENIUS Act Passes: How the New Crypto Bill Reshapes Stablecoins
2025-06-18 08:18:54U.S. Senate Passes Landmark GENIUS Act, Setting First Federal Framework for Stablecoins
Will This Be the Tipping Point for Crypto’s Mainstream Adoption?
In a historic move, the U.S. Senate has passed the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, marking the first comprehensive federal legislation to regulate the $250 billion stablecoin market. The bill, approved with a 68-30 bipartisan vote, aims to bring much-needed clarity to a rapidly growing sector while addressing concerns over financial stability, consumer protection, and illicit finance.
The legislation now heads to the House of Representatives, where it will be reconciled with the STABLE Act, an earlier House proposal. If signed into law, the GENIUS Act could reshape the global crypto landscape, reinforcing the U.S. dollar’s dominance in digital finance while opening doors for institutional adoption.
A Long-Awaited Regulatory Milestone
Stablecoins—cryptocurrencies pegged to fiat currencies like the U.S. dollar—have become a cornerstone of crypto trading, payments, and remittances. Currently, Tether’s USDT and Circle’s USDC dominate nearly 90% of the market, raising concerns over centralization and transparency.
The GENIUS Act introduces strict requirements for issuers, including:
1:1 reserve backing with high-quality liquid assets (e.g., cash, short-term Treasuries)
Monthly public disclosures of reserve compositions
Federal and state dual licensing, allowing both banks and non-bank entities to issue stablecoins under regulatory oversight.
"This is a paradigm-shifting development that can bring our payment system into the 21st century," said Senator Bill Hagerty (R-Tenn.), the bill’s sponsor. "Businesses and Americans will be able to settle payments nearly instantaneously rather than waiting days or weeks".
Political Tensions and Unresolved Conflicts
Despite bipartisan support, the bill faced fierce opposition from Democrats concerned about President Trump’s financial ties to the crypto industry. Trump’s family holds a stake in World Liberty Financial, a firm that launched its own stablecoin, USD1, and reportedly earned him $57.35 million in 2024.
Senator Elizabeth Warren (D-Mass.) criticized the bill as a "superhighway for Trump’s corruption," arguing it lacked sufficient guardrails against conflicts of interest. However, proponents like Senator Kirsten Gillibrand (D-N.Y.) defended the legislation as a necessary step to prevent the U.S. from falling behind in global crypto competition.
Global Implications and Market Reactions
The GENIUS Act could accelerate stablecoin adoption in emerging markets, where dollar-pegged tokens are increasingly used to hedge against inflation and facilitate cross-border payments. Treasury Secretary Scott Bessent projected that the stablecoin market could grow to $3.7 trillion by 2030 if properly regulated.
Crypto exchanges and institutional players have welcomed the bill. Coinbase CEO Brian Armstrong, who has met with Trump, praised the legislation as a critical step toward legitimizing digital assets. Meanwhile, analysts predict that major banks and fintech firms will soon launch their own stablecoins, intensifying competition in the sector.
What’s Next?
The House must now reconcile differences between the GENIUS Act and its own STABLE Act, which includes stricter provisions on algorithmic stablecoins and state-level oversight. President Trump has signaled he wants the bill on his desk before Congress’s August recess.
For investors, the legislation could reduce regulatory uncertainty, but risks remain—particularly around enforcement and potential market saturation. As Nic Puckrin, founder of The Coin Bureau, noted: "The real test will be whether this framework can balance innovation with stability without stifling growth".
Share your thoughts on our X: Will the GENIUS Act solidify the U.S. as the leader in crypto, or will loopholes undermine its effectiveness?
Disclaimer: The information provided in this section is for reference only and does not represent any investment advice or the official views of FameEX.
Sources:
Reuters: "US Senate passes stablecoin bill in milestone for crypto industry"
PBS NewsHour: "Senate passes crypto bill 'GENIUS Act'"
CoinDesk: "U.S. Senate Passes GENIUS Act to Regulate Stablecoins"
CNBC: "What the GENIUS Act could mean for crypto and other investors"
TRM Labs: "GENIUS Act Passes Senate, Paving the Way for Landmark US Crypto Legislation"