On Tuesday, the Senate achieved a significant milestone in cryptocurrency regulation by passing the GENIUS Act, a landmark bill that sets the first federal standards for stablecoins.
The legislation, which secured a 68-30 vote, creates a regulated pathway for private companies to issue digital dollars under the federal government’s oversight.
While the bill has successfully passed the Senate, it faces challenges in the Republican-controlled House, where another version of a stablecoin bill, known as STABLE, is under consideration.
Despite these hurdles, the Senate’s approval signals a turning point not only for the technology itself but also for the political influence surrounding it.
The GENIUS Act, officially titled the Guiding and Establishing National Innovation for US Stablecoins Act, introduces essential guardrails for the stablecoin industry. Among its provisions are requirements for full reserve backing, monthly audits, and compliance with anti-money laundering regulations.
The act also opens doors for a wider array of issuers, including banks, fintech companies, and major retailers, to launch their own stablecoins or integrate them into existing payment systems.
Treasury Secretary Scott Bessent, who will have significant regulatory authority under the bill, indicated during a recent Senate appropriations hearing that the US stablecoin market could potentially grow nearly eightfold, reaching over $2 trillion in the coming years.
Initially, the GENIUS Act was expected to be one of the easier crypto bills to pass, but it has faced considerable delays and difficulties, including a previous failure to reach the Senate floor.
Senator Cynthia Lummis of Wyoming expressed her surprise at the challenges encountered, stating, “I had no idea how hard this was going to be.”
Senator Bill Hagerty from Tennessee echoed this sentiment, highlighting the complexity of garnering bipartisan support, particularly from the 18 Senate Democrats who ultimately voted in favor of the bill.
Featured image from DALL-E, chart from TradingView.com
