There’s a big, beautiful bill making its way through Congress right now that could potentially reshape the American economy forever.
No, not the spending & tax bill that’s been hogging all the headlines lately. We’re talking about the GENIUS Act, or the Guiding and Establishing National Innovation for US Stablecoins Act. Just two weeks after a 49-48 vote stalled the bill, a successful Senate vote late yesterday evening advanced the bill to full floor consideration, bringing it one step closer to becoming law.
Who’s this genius?
In a nutshell, the GENIUS Act establishes a federal framework for regulating stablecoins, which are crypto tokens pegged to a currency—usually the US dollar. Their stability makes them more suitable for use in transactions than other, more volatile cryptocurrencies.
The Act is touted by its sponsors as a way to protect consumers, and includes provisions detailing how stablecoin issuers like Tether—which issues USDC, the most popular stablecoin—will be required to hold liquid reserves of safe assets like Treasury bills to underpin its product.
While that sounds all well and good, President Trump’s deep involvement in the crypto industry has become an obstacle in the bill’s path to ratification. Democrats, led by Senator Elizabeth Warren, have decried the president’s $TRUMP crypto coin and his ownership stake in World Liberty Financial, which issues a stablecoin known as USD1, as blatant corruption. They argue that the president’s intention to profit from the passage of the bill—and the crypto industry’s subsequent growth—has little to do with protecting American consumers.
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That’s why Democrats forced the bill to go back to the drawing board earlier this month. Calls for more safeguards resulted in modifications to the bill, including preventing Big Tech companies from launching stablecoins and forbidding senior executive branch employees from launching their own stablecoins—though that notably excludes the president and vice president.
Why it matters
While stablecoins are used primarily for trading these days, crypto advocates believe they represent the next evolution of payment networks. Stablecoin payments are fast, provide options for underbanked users, and allow people to send money across borders without paying fees.
Crypto bulls believe the $250 billion stablecoin market would enjoy explosive growth thanks to this legislation, as banks and Wall Street investors perceive regulation to be a safety net that would allow them to pour billions into the sector.
What happens next: The bill is on its way to a Senate full floor vote, one that could take place as soon as this week. Once that hurdle is cleared, it would need to pass a vote in the House of Representatives before finally landing on President Trump’s desk to be signed into law.—MR