President Donald Trump signed the GENIUS Act into law on July 18, pledging that this measure would ensure "global dominance" in cryptocurrency technology.

This bill provides the U.S. with the first federal framework for dollar-backed stablecoins. Trump celebrated the passage of the bill, stating:

"Cryptocurrency has risen more than any stock. Cryptocurrency makes the dollar look good. Cryptocurrency is good for the dollar, for the whole country."

He added that the GENIUS Act puts the country in a leading position in the industry and committed to approving legislation on a broader cryptocurrency market structure before the end of the year.

Senior member of the Senate Banking Committee Tim Scott called this act "regulatory clarity for the stable cryptocurrency industry" and stated that faster, cheaper payments would "reinforce the dominance of the U.S. dollar globally."

Treasury Secretary Scott Bessent reiterated this theme in a post on X, thanking House Republicans for their "promises kept" that transformed America into the "cryptocurrency capital of the world."

Stablecoin Framework

The GENIUS Act establishes a federal framework for the issuance and oversight of stablecoins.

This law assigns the Federal Reserve the task of licensing and supervising nationally chartered insured depository institutions, while allowing qualifying state-chartered companies to mint dollar-pegged tokens if they meet equivalent standards for reserves, disclosure, redemption, and risk control.

The issuer must ensure that each token is backed by high-quality liquid assets, such as cash, treasury bonds, or other short-term government securities, in line with their outstanding liabilities and provide regular attestation reports.

This law also directs banking regulators to establish a testing schedule, ensuring consumers' rights to redeem at real value within a specific timeframe and mandates that reserve assets must be segregated unless customers explicitly agree to re-hypothecation.

The Final Stretch

The House passed the GENIUS Act 307-122 on July 17, one day after passing a 215-211 motion to reconsider the combined procedural package of the GENIUS Act with the CLARITY Act and the Anti-CBDC Oversight Act.

Lawmakers initially combined these three measures on July 16 to expedite discussions, but that resolution was not a registrable text. Subsequently, the committee staff prepared the GENIUS language into a standalone bill that both chambers could pass in identical form.

The Senate approved a consolidated version on July 17, completing the bicameral process needed for enrollment and submission to the White House.