A political confrontation is heating up in the U.S. Senate as the Republican Party (GOP) is determined to bring the GENIUS Act – the first bill on stablecoin regulation – to a vote on Thursday, despite increasing opposition from both the Democratic Party and some GOP members. Is this an effort to promote crypto policy, or a strategic move preparing for the 2026 midterm elections?
GENIUS Act – The first bill for stablecoins in the U.S.
The full name of the bill is the Guiding and Establishing National Innovation for U.S. Stablecoins Act, designed to establish the first federal legal framework for USD-pegged stablecoins. Key provisions include licensing requirements, asset reserve requirements, and transparency of information for stablecoin issuers in the U.S.
The GENIUS Act previously passed the Senate Banking Committee with bipartisan support in March. However, things became messy after a new draft of the bill was leaked without going through an official meeting, leaving many senators – particularly from the Democratic Party – upset due to not being informed about the significant changes.
Internal divisions, the Democratic faction strongly opposes
Currently, at least 9 Democratic senators and 3 Republican senators have voiced their opposition. Notable names include Rand Paul (Kentucky), Josh Hawley (Missouri), and John Kennedy (Louisiana) – all significant voices in the GOP.
Opposition is not limited to the Senate: the Democratic faction in the House of Representatives also staged a "walkout" during the hearing on Tuesday, protesting crypto-related projects under President Donald Trump and raising concerns about conflicts of interest.
Is the GOP playing 'political chess'?
Despite knowing it would be difficult to achieve the necessary 60 votes to overcome procedural hurdles without more support from the Democrats, the GOP is determined to proceed with the vote. According to many experts, this is a move aimed at blaming the Democratic Party if the bill fails – serving the upcoming election campaign.
Senator Bill Hagerty – a supporter of the bill – believes that bringing the bill to the floor is a way for the U.S. to maintain its leading role in digital asset innovation. He wrote on social media:
"We have two choices: Move forward with a bipartisan spirit to improve, or show that crypto legislation is still just a Republican issue."
Is the crypto market affected?
If passed, the GENIUS Act will create the first comprehensive legal framework in the U.S. for stablecoins, which could have widespread implications for issuers like USDC, USDT… and thereby affect the entire DeFi and CeFi ecosystem. This is also an important signal for investors and exchanges like Binance that are closely monitoring the situation in the U.S.
While success is not guaranteed, the GOP's persistence in pursuing this bill demonstrates that the crypto policy race is hotter than ever, with increasing backing from lobbying organizations like Fairshake – a crypto-friendly PAC preparing to spend heavily in the upcoming elections.
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Risk warning: Changes in policy and legal frameworks can significantly affect the price and legality of digital assets. Investors should always stay updated and be cautious with developments related to legal frameworks in major markets like the U.S. Crypto is a promising field but comes with high risks, not suitable for all investors.