The U.S. Senate has officially advanced the GENIUS Act, aimed at regulating stablecoins. This bill received bipartisan support and is now set for debate.
GENIUS Act Overview and Goals
The GENIUS Act, short for *Guiding and Establishing National Innovation for U.S. Stablecoins*, was approved by Senators with a vote of 66-32. It provides a clear structure for stablecoin regulation, requiring issuers to maintain one-to-one reserves in cash or U.S. Treasury securities. Large issuers with more than $10 billion will be under federal oversight. The bill also bans algorithmic stablecoins and incorporates stringent anti-money laundering (AML) and know-your-customer (KYC) protocols.
Political Reactions to the Bill
Despite the controversies surrounding the bill, including criticism from Senator Elizabeth Warren, who claims it could benefit Trump's USD1 stablecoin project, support is generated due to the rapid growth of the crypto industry. Warren described the bill as a gift to 'crypto corruption', alluding to the Trump family's blockchain ventures. However, many lawmakers now agree that regulation is necessary to prevent unchecked growth.
Prospects After Senate Approval
If the GENIUS Act passes the Senate, it will be sent to the House of Representatives, which has its own version of a stablecoin bill, the STABLE Act. Analysts expect lawmakers to combine the two bills, leading to a single set of rules for stablecoins in the U.S. This process could result in the establishment of the first comprehensive legal framework for stablecoins in the country, considering the interests of all market participants.
The GENIUS Act marks a turning point for U.S. crypto policy. With the introduction of federal oversight, it is expected to enhance investor protection and prevent illegal activity, as well as strengthen the dollar in digital markets.
