The US Senate passed a critical cloture vote on the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act. The bill passed with 66 votes in favor and 32 votes against.
However, it’s important to note that the bill has not become law yet. It will proceed to the Senate floor for debate and possible amendments.
GENIUS Act Clears Cloture Vote
The highlight of the cloture vote was that sixteen Democrats changed their votes to support the bill, a significant shift in favor of the GENIUS Act.
According to reporter and Crypto In America host Eleanor Terrett, the bill will move to the Senate by tonight or Wednesday.
“GOP leaders had been hoping to get in a final passage vote before Memorial Day next Monday, but unclear if that will happen at the present time,” Terrett noted.
Faryar Shirzad, Coinbase’s Chief Policy Officer, described the vote as a “historic early win.” He emphasized that while many steps remain, this move brings stablecoin legislation closer to becoming a reality.
“Crypto is again showing that it’s the biggest bipartisan issue in play on the Hill,” Shirzad wrote.
Senator Bill Hagerty, the bill’s sponsor, also expressed optimism. He predicted that the GENIUS Act could drive demand for US Treasury bonds by over $1 trillion, potentially bolstering the country’s financial system.
“The GENIUS Act skyrockets the United States with a digital payment framework with the fastest rails possible. It will ensure US dollar dominance,” Senator Hagerty posted.
However, the legislation has also drawn sharp criticism. Senator Elizabeth Warren, Ranking Member of the Senate Banking Committee, warned of systemic risks, citing a Nobel Prize-winning economist in a statement on X.
“We urgently need strong regulatory oversight of stablecoins. The GENIUS Act lacks fundamental provisions to preserve financial stability and would increase systemic risk stemming from stablecoin runs and inadequate guardrails on foreign issuers,” economist Simon Johnson remarked.
Crypto commentator Richard Heart also offered a scathing critique. He argued that the GENIUS Act would force stablecoins into the traditional banking system. He claimed it would ban decentralized stablecoins, limit issuance to licensed banks and partners, and offer no interest to holders, effectively stifling innovation in the decentralized finance space.
“It’s a *stablecoin crackdown* that protects incumbents and could handcuff DeFi innovation. USDC, USDT, DAI,” Heart stated.
While the cloture vote was a procedural win, it revealed deep divisions. For now, the bill’s final passage remains uncertain. As the Senate prepares for the decisive vote, the debate over stablecoin regulation continues to intensify, with far-reaching implications for the future of digital finance in the US.
