The U.S. Senate has passed the GENIUS Act. The Senate passed legislation to establish the first regulatory framework for stablecoins, capping prolonged, topsy-turvy bipartisan negotiations.
According to media reports, the Senate voted 68-30 to pass the bill Tuesday, with two Republicans voting no.
The GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins Act) is a bipartisan legislative effort introduced in 2025 to create a clear regulatory framework for stablecoins—digital assets pegged to the value of traditional currencies like the U.S. dollar.
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Sponsored by Senator Bill Hagerty (R-TN) and co-sponsored by a coalition of both Republican and Democratic senators, the GENIUS Act aims to balance innovation in the digital currency space with necessary safeguards for consumers and the broader financial system.
With the stablecoin market growing rapidly, lawmakers see this bill as essential to provide regulatory certainty, foster innovation, and reduce potential systemic risks.
The GENIUS Act establishes a dual regulatory structure for stablecoin issuers. Issuers with over $10 billion in assets or those affiliated with federally regulated banks would be overseen by federal agencies such as the Federal Reserve or the Office of the Comptroller of the Currency (OCC). Smaller issuers, however, would fall under the jurisdiction of state regulators, allowing for flexibility and fostering competition among states.
Key provisions of the bill include strict reserve requirements mandating that stablecoins be backed 1:1 by U.S. dollars, insured bank deposits, or short-term Treasury bills. The bill also introduces transparency and auditing requirements to protect consumers and ensure the stability of stablecoin issuers.
Critics, including Senator Elizabeth Warren, expressed concerns about potential regulatory loopholes and conflicts of interest, especially related to lawmakers’ ties to the crypto industry.
Despite these concerns, the bill’s passage in the Senate marks a significant step toward establishing national rules for digital currencies. It now moves to the House of Representatives, where further debate and potential amendments are expected before it can become law.
The passage of the GENIUS Act marks a significant shift in how the United States approaches cryptocurrency regulation, particularly stablecoins. For the first time, there is a clear federal framework that outlines how digital currencies tied to traditional assets—like the U.S. dollar—should be issued, backed, and monitored. This move brings much-needed clarity to a rapidly growing sector that has, until now, operated in a legal gray area.
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For the cryptocurrency industry, this legislation signals a level of acceptance and legitimacy. By establishing rules, the U.S. government is acknowledging that stablecoins and digital assets are here to stay. It provides clear guidance for companies looking to innovate while protecting consumers from fraud, instability, and potential misuse. This could encourage more traditional financial institutions and investors to enter the crypto space, potentially fueling innovation and economic growth.
From a broader perspective, the GENIUS Act positions the U.S. as a leader in digital asset regulation. In a global race to shape the future of finance, having a structured and enforceable policy gives the U.S. a competitive edge. It also helps protect national security and financial stability by creating standards for reserve backing and restricting foreign influence in domestic digital finance systems.
