4 min read
Jun 23, 2025
US Senate Passes GENIUS Act
TL;DR
The U.S. Senate passed the GENIUS Act with bipartisan support (68–30), establishing the first federal framework for stablecoin issuance.
The Act permits three types of issuers, requires 1:1 liquid asset reserves, bans yield-bearing stablecoins, and excludes approved stablecoins from being classified as securities.
The bill now moves to the House; while its future is uncertain, it marks significant progress toward regulatory clarity for the crypto industry.
The US senate recently passed the GENIUS Act, signaling a major step forward in US stablecoin policy. It passed with broad bipartisan support, with 68 members voting for and 30 against.
The GENIUS Act, which stands for “Guiding and Establishing National Innovation for US Stablecoins,” sets the first federal framework for how US companies can issue and manage stablecoins, which are digital currencies pegged to the dollar (or other assets like gold or different currencies).
Key Provisions of the Genius Act
The GENIUS Act would permit stablecoin issuance by three types of entities:
Subsidiaries of insured banks
Federally regulated issuers
State-regulated issuers
These issuers must hold fully backed 1:1 reserves in safe, highly liquid assets such as U.S. currency, insured deposits, short-term Treasuries, or approved repurchase agreements. Rehypothecation of reserves is banned.
The Act imposes strict operational standards, including monthly reserve disclosures, clear redemption policies, and robust anti-money laundering controls. Issuers with over $50 billion in circulation must provide audited financials.
The Act also prohibits yield-bearing stablecoins. Perhaps most importantly, stablecoins issued by approved entities would not be classified as securities under federal law, providing much-needed regulatory clarity around their status and classification. A three-year transition period is also included.
What Happens Next?
The Act will now move to the House of Representatives before proceeding to President Trump’s desk to be signed into law. If enacted, it will take effect 18 months after passage or 120 days after federal regulators issue implementing regulations, whichever comes first. However, its path forward is uncertain. The House may introduce amendments, delay consideration, or oppose key provisions, and the final outcome will likely depend on broader negotiations around digital asset regulation.
Nevertheless, many in the crypto industry view the GENIUS Act as a significant step forward. Even with an uncertain path ahead, the bill’s clear regulatory framework for stablecoins represents progress toward long-sought legal clarity — and signals growing momentum for comprehensive digital asset legislation in the U.S.
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