President Donald Trump has demanded Congress send the recently passed GENIUS Act to his desk, emphasizing its importance to the stablecoin industry.
What’s in the GENIUS Act?
The GENIUS Act, passed in the Senate with bipartisan support, establishes a legal foundation for stablecoin issuers and includes key provisions:
* 1:1 reserve backing: All stablecoins must be backed by equivalent liquid reserves. * Monthly disclosures and third-party audits for issuers exceeding $10 billion in market cap. * Clear regulatory oversight by federal and state agencies. * Strict anti-money laundering and identity verification measures. * Bankruptcy prioritization for stablecoin holders.
Trump’s Involvement and Ethical Questions
Trump’s involvement in fast-tracking the GENIUS Act has sparked both praise and controversy. While he supports crypto adoption, critics like Senator Elizabeth Warren highlight potential conflicts of interest, as the bill does not prohibit the President and Vice President from holding stakes in stablecoin companies. Warren stated: 'The American public deserves regulation without backroom self-dealing.'
Industry Response and Expected Consequences
Leading crypto figures, including Coinbase CEO Brian Armstrong, have expressed support for the bill, hoping it will enhance institutional trust. However, some analysts warn that the act could pressure decentralized protocols, indicating that 'this isn’t a win for DeFi just yet.' If enacted, it may establish the U.S. as a regulatory leader in stablecoin policy and lead to increased institutional investments in crypto infrastructure.
The GENIUS Act represents a significant step in U.S. crypto regulation. While it presents potential advantages, concerns about conflicts of interest and issuer limitations cannot be ignored. The coming weeks will clarify how this law will shape the future of the crypto industry in America.
