State of Crypto: The Industry’s No Good, Very Bad Wait Actually Excellent Week

The “Guiding and Establishing National Innovation for U.S. Stablecoins Act,” otherwise known as the GENIUS Act, is now the law of the land, after President Donald Trump signed the first major U.S. legislation following a week-long process to pass it and two other bills in the House of Representatives. You’re reading State of Crypto, a CoinDesk newsletter looking at the intersection of cryptocurrency and government. Click here to sign up for future editions. Stable tokens The narrative On Friday, U.S. President Donald Trump signed a crypto bill into law. This is the first time a major cryptocurrency bill has become law, and it likely is not the last. Why it matters For the first time, a major cryptocurrency bill has become law in the U.S. The GENIUS Act, which sets out to create a regulatory framework governing stablecoins, or cryptocurrencies pegged to another asset like the U.S. dollar, kickstarts a process that will see the Federal Reserve, Office of the Comptroller of the Currency and other regulators become far more involved in the crypto sector. Breaking it down There was a bit of a false start. The House Rules Committee met Monday evening to debate the bills with key members of the Financial Services and Agriculture Committees ahead of a procedural vote, which the House held Tuesday. That procedural vote was expected to sail through, albeit on party-line votes. It did not. Members of the House Freedom Caucus voted against the procedural motion to open debate and threw a wrench into the House’s “Crypto Week.” Later that evening, U.S. President Donald Trump posted on his social media platform Truth Social that 11 of the holdouts had agreed to vote for the motion and the House reconvened on Wednesday to first vote to hold a redo on the other vote (this one passed mostly along party lines) and then to actually redo the other vote. Many of the 11 holdouts continued to hold out. Trump, in remarks made before signing the GENIUS Act on Friday, joked about this: “I am so tired of making phone calls at 2, 3, 4 o’clock in the morning.” Still, after a record-breaking 9+ hour vote, the lawmakers did finally vote in favor of the move to debate, clearing the way to a final vote for the three bills on Thursday. Despite these hiccups, Congressman Bryan Steil noted that Crypto Week largely played out as planned, with three bills getting passed and one heading to the president’s desk. “In the House, it feels like in the home stretch with the narrow majority, there’s final negotiations, final discussions,” he said on CoinDesk TV Thursday ahead of the vote. “But the good news is the play call that was made at the start of the week is the play call we’re executing today, which is passing GENIUS, putting that on the president’s desk for his signature into law.” Moreover, while industry participants anticipated that maybe 30 or so Democrats would vote for the bills, the actual numbers dramatically surpassed this — 78 Democrats joined 216 Republicans in voting for Clarity and 102 Democrats/206 Republicans voted for GENIUS. For context, last year’s Financial Innovation and Technology for the 21st Century Act (FIT21), Clarity’s predecessor, saw 78 Democrats and 208 Republicans vote in favor. House Financial Services Committee Chairman French Hill, speaking at a press conference after Thursday’s votes, was positively giddy at successfully shepherding the bills through in just a matter of months: “I knew that my target was to beat FIT21 and I made a bet with myself — and I won.” Neither Clarity nor GENIUS are done yet. The next steps for GENIUS belong to the federal regulators tasked with implementing its provisions. The Federal Reserve, Office of the Comptroller of the Currency and others will now have to launch the rulemaking process to develop the actual regulations asked for in the law. Clarity’s next steps are murkier. The Senate is clearly working on its own bill, at least at the moment — senators have introduced principles and are holding hearings. These actions suggest the Senate Banking and Agriculture Committees may do their own thing, rather than adopt Clarity as it is. Hill, in Thursday’s press conference, made it clear he hoped the Senate would take Clarity up. And House Agriculture Committee Chair Glenn GT Thompson said on CoinDesk TV on Thursday morning that he had been working with his Senate counterparts as it launched its process. Banking Committee Chair Tim Scott previously set a Sept. 30 deadline for moving the Senate’s market structure bill, which will govern a far broader swath of the industry. Read CoinDesk’s coverage from Crypto Week: House Gears Up for Crypto Market Structure Vote on Wednesday, Stablecoins Thursday House’s Crypto Markets Bill on Track, But Some in Industry Hope For Senate Overhaul ‘Crypto Week’ Back on Track? Trump Says Defecting Lawmakers Ready to Vote for Bills Senate Agriculture’s Top Dem: Crypto Market Structure Effort Needs ‘Serious Changes’ ‘Crypto Week’ Is Stuck Again as House Procedural Vote Drags On ‘Crypto Week’ Back on Track After Lengthy House Do-Over Vote U.S. House’s ‘Crypto Week’ Shifts Toward Getting All Legislation Out Thursday U.S. House Passes CLARITY Act, Moves on to Stablecoin Vote GENIUS Act for Stablecoins Passes House on Way to Being First Major U.S. Crypto Law ‘Crypto Week’ Reaction: What GENIUS and CLARITY Bills Mean for the Industry Trump to Sign the Historic GENIUS Act Into Law. What Does It Mean for Crypto? Trump Signs GENIUS Act Into Law, Elevating First Major Crypto Effort to Become Policy Tether CEO Says He’ll Comply With GENIUS to Come to U.S., Circle Says It’s Set Now Trump Signs GENIUS Act Into Law: The Full Transcript Stories you may have missed U.S. Banking Regulators Issue Crypto ‘Safekeeping’ Statement, Not Pushing New Policy : The federal banking regulators published a statement addressing crypto custody. U.S. Prosecutors, CFTC Drop Polymarket Investigations : The U.S. Department of Justice and Commodity Futures Trading Commission are dropping their investigations into whether Polymarket allowed U.S. traders access to its platform despite a consent decree Polymarket agreed to saying it wouldn’t. Bank of America Joins Stablecoin Rush as CEO Moynihan Says Work Already Underway : Brian Moynihan said the Bank of America does have plans to get into stablecoins and has already begun working on something. Early Bitcoin Investor Roger Ver Sues Spain to Prevent Extradition to the U.S. : Roger Ver is fighting his extradition to the U.S. to face tax evasion charges. Tornado Cash Tornado Cash developer Roman Storm’s criminal trial kicked off this week, with jury selection taking a day and a half and the overall trial now expected to run approximately three weeks. Storm was arrested in 2023 and charged with conspiracy to commit money laundering, conspiracy to violate sanctions and conspiracy to operate an unlicensed money transmitting business. So far prosecutors have only just begun making their case, beginning with a set of witnesses who say they were victims of Tornado Cash. Prosecutors will be making their case to a largely non-technical jury. Just one member works as an IT manager, while another works at Palantir. The rest have a range of jobs and educational backgrounds. There’s also ongoing motions efforts separate from the trial itself, with defense attorneys moving to try and kick out some of the evidence prosecutors have suggested they’ll introduce. Right to Code? Tornado Cash Dev Roman Storm’s Money Laundering Trial Kicks Off Monday Jury Seated for Tornado Cash Dev Roman Storm’s Trial Legitimate Privacy Tool or Dirty Money ‘Laundromat’? Lawyers Debate Role of Tornado Cash on Day 1 of Roman Storm Trial Hack ‘Victims’ Say Tornado Cash Offered No Help in the Wake of Exploits: Day 2 of Roman Storm Trial This week Monday 20:00 UTC (4:00 p.m. ET) The House Rules Committee met to discuss the Clarity Act, GENIUS Act and Anti-CBDC Act and debate on whether there would be an amendment process prior to votes for these bills. Tuesday 19:00 UTC (3:00 p.m. ET) The Senate Agriculture Committee held its first hearing on digital commodities ahead of anticipated market structure legislation. Wednesday 13:00 UTC (9:00 a.m. ET) The House Ways and Means Committee met to discuss crypto tax issues. 14:15 UTC (10:15 a.m. ET) House Democrats led by Financial Services Ranking Member Maxine Waters held a press conference to reiterate their concerns with the various pieces of legislation. Thursday 19:45 UTC (3:45 p.m. ET) The House scheduled a vote for the crypto bills, though this time was moved up to 2:40 p.m. ET right before that revised time. Friday 18:30 UTC (2:30 p.m. ET) The White House held a signing ceremony for the GENIUS Act. Elsewhere: ( The Wall Street Journal ) Tokens purporting to represent stocks may not actually track the prices of those underlying stocks that closely, the Journal reports. ( 404 Media ) Immigration and Customs Enforcement is using a powerful new facial recognition tool. ( Infotel CA ) This is just a charming story about a massive marmot. Enjoy. If you’ve got thoughts or questions on what I should discuss next week or any other feedback you’d like to share, feel free to email me at [email protected] or find me on Bluesky @nikhileshde.bsky.social . You can also join the group conversation on Telegram . See ya’ll next week!

Source: CoinDesk