Big Win For Crypto As Senate Passes Landmark Stablecoin Bill

The United States Senate has passed the GENIUS Act, giving the crypto industry its first legislative win. The bill passed the Senate thanks to bipartisan support and is the first major crypto legislation to clear the chamber. The bill now moves to the House, where it must be reconciled with the House’s stablecoin bill, the STABLE Act. Senate Passes Genius Act The United States Senate officially passed the GENIUS Act after months of deliberations, false starts, and stops. The landmark legislation officially establishes a framework for trading and issuing stablecoins in the United States. The bill received bipartisan support and passed with a 68-30 vote, with 18 Democrats joining the Republicans in supporting the legislation. However, a Senate Republican, Josh Hawley, opposed the bill, joining Democrats in opposition to provisions in the legislation that would allow big tech firms to issue stablecoins and track user spending data under specific conditions. The GENIUS Act mandates stablecoins be backed by liquid assets like the US Dollar, and short-term Treasury Bills. Stablecoin issuers will also be required to disclose the composition of their reserves. It also mandates regular audits for issuers with a market capitalization greater than $50 billion and adds more compliance rules for foreign issuers like Tether. The bill also bars non-financial public companies like Meta and Amazon from issuing stablecoins until they meet specific risk and privacy requirements. It also gives stablecoin holders priority in bankruptcy proceedings. It also grants Treasury Secretary Scott Bessent sweeping powers. Bessent told a Senate appropriations subcommittee during a hearing that the stablecoin market could grow to $2 trillion over the next few years. Bessent stated on Tuesday, “A thriving stablecoin ecosystem will drive demand from the private sector for US Treasuries, which back stablecoins. This newfound demand could lower government borrowing costs and help rein in the national debt. It could also onramp millions of new users—across the globe—to the dollar-based digital asset economy.” The Next Step The GENIUS Act now heads to the House, where it must be reconciled with the STABLE Act. The STABLE Act advanced out of the committee in May, with both proposals differing on state versus federal oversight and the treatment of foreign stablecoin issuers. A reconciliation of the bills must be required before any form reaches President Donald Trump’s desk for approval. President Trump has endorsed stablecoin regulation and is pushing for a bill to be signed into law by August. Senator Cynthia Lummis said the GENIUS Act was supposed to be the easiest crypto bill to pass but took months of deliberations to reach the Senate floor. The bill only passed after fierce negotiations. “We thought it would be easiest to start with stablecoins. It has been extremely difficult. I had no idea how hard this was going to be.” Crypto Industry Hails Landmark Legislation While the bill faces several hurdles in the House, its passage from the Senate marks a turning point for the ecosystem and its political clout. Crypto industry leaders were quick to call the vote a landmark victory. Liat Sherat, Vice President of Global Policy and Regulation at Elliptic, stated, “The U.S. approving its first major federal legislation focused on stablecoins is a pivotal step in shaping the country’s digital asset future and addressing oversight of the rapidly growing digital asset ecosystem.” Amanda Tuminelli, Executive Director of the DeFi Education Fund, called it a big win for the US and innovation, stating, “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.” Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice

Source: Crypto Daily