#GENIUSActPass

The GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins) is a U.S. Senate bill passed on June 17, 2025, with a 68–30 vote. It establishes the first federal regulatory framework for stablecoins—digital tokens pegged to the U.S. dollar—aiming to enhance consumer protection, financial stability, and innovation in the digital asset sector.

Key Provisions:

Reserve Requirements: Stablecoin issuers must maintain 1:1 backing with liquid assets such as U.S. Treasury securities or insured bank deposits.

Dual Licensing: Issuers with market capitalizations over $10 billion are subject to federal oversight, while smaller issuers can opt for state-level regulation, provided they meet federal equivalency standards.

Transparency and Compliance: Issuers are required to disclose reserve compositions and redemption policies, undergo annual audits, and adhere to anti-money laundering regulations.

Consumer Protections: In the event of issuer bankruptcy, stablecoin holders' claims take precedence over other creditors.

The bill now moves to the House of Representatives, where a corresponding STABLE Act is under development. Industry leaders view the GENIUS Act as a critical step toward integrating digital assets into mainstream finance, with potential to transform the $236 billion stablecoin market into a $2.5 trillion sector.

However, the legislation has faced criticism, particularly from Democrats concerned about potential conflicts of interest involving former President Donald Trump, who has financial ties to the USD1 stablecoin issuer. Despite these concerns, the bill's passage marks a significant milestone in the regulation of digital assets in the United States.