Original Block unicorn Block unicorn May 22, 2025 18:21 Chongqing Article by: Token Dispatch, Shruti Lohar
Article translated by: Block unicorn

Preface

The U.S. Senate has restarted landmark stablecoin legislation, with the GENIUS bill passing a critical procedural vote on Monday evening, just two weeks after it seemed to have stalled in the Senate.

Senators advanced the bill by a vote of 66 to 32, easily surpassing the 60-vote threshold needed to end debate and move to final consideration.

This unexpected shift reflects changing political dynamics.

Earlier this month, the bill failed due to the withdrawal of support from key Democratic co-sponsors, dealing a blow to Republican leaders.

What has changed?

After two weeks of intense negotiations, the revised draft added new provisions addressing Democratic concerns about conflicts of interest, national security protections, and the potential involvement of large tech companies in the field.

Five key Democratic senators—Ruben Gallego (Arizona), Mark Warner (Virginia), Lisa Blunt Rochester (Pennsylvania), Kirsten Gillibrand (New York), and Angela Alsobrooks (Maryland)—changed their stance to support the bill after previously opposing it.

The initial failure of the bill was partly due to concerns among Democrats about President Donald Trump's deepening ties with cryptocurrency enterprises. The Trump family has launched several crypto projects, including a stablecoin called USD1, which has quickly become the seventh largest stablecoin by market capitalization.

'We cannot allow this corruption to blind us to the broader reality: blockchain technology is here to stay. If U.S. lawmakers do not shape it, others will—and not in a way that aligns with our interests or democratic values,' Senator Mark Warner acknowledged these concerns before supporting the bill.

The revised bill prohibits senior executive branch officials from launching stablecoins, but exempts the president and vice president, only partially addressing concerns related to Trump.

What does the bill contain?

The GENIUS bill (Guiding and Establishing National Innovation for U.S. Stablecoins Act) will:

  • Require stablecoins to be fully backed by U.S. dollars or similar liquid assets

  • Mandate annual audits for issuers with a market capitalization over $50 billion

  • Establish a framework for the legal issuance of stablecoins in the U.S.

  • Restrict algorithmic stablecoins

  • Incorporate consumer protection provisions and anti-money laundering standards

Democrats on the Senate Banking Committee released a critical staff analysis of the latest draft of the GENIUS bill.

The report states that the draft could be a potential roadmap for 'Trump's crypto corruption' and increased control of digital currency by large tech companies.

Staff called for further revisions, emphasizing several key issues:

  • The bill does not prohibit Trump from profiting from his own stablecoin.

  • It allows Elon Musk's X platform to launch its own digital currency 'X Money'.

  • It expands the existing loopholes for Tether, potentially facilitating criminal and terrorist activities.

  • It lacks sufficient consumer protection and financial security measures.

Despite these warnings, five Democratic senators who opposed the bill two weeks ago now support it.

Not everyone was convinced by the last-minute changes.

Senator Elizabeth Warren strongly criticized the bill before the vote.

'Trump and his family have made hundreds of millions from their crypto enterprises, and if this bill passes, they will make hundreds of millions more through their stablecoin USD1. The GENIUS bill will accelerate Trump's corruption by expanding the stablecoin market,' Warren argued.

The revival of the stablecoin bill comes as lobbying efforts from the industry intensify.

According to Decrypt, Coinbase, which had previously been hesitant about independent stablecoin legislation, has ramped up its lobbying efforts in recent days, urging users to contact their senators through in-app notifications.

The political action committee for the cryptocurrency exchange 'Stand With Crypto' stated that if lawmakers vote against the bill, their ratings will be lowered— the organization leveraged $300 million raised last year for a super PAC supporting cryptocurrency.

If the Senate approves, the GENIUS bill still needs to be approved by the House before it can be sent to Trump's desk.