Lawmakers clash over amendments as the controversial GENIUS Act aims to regulate the $250 billion stablecoin market.The US Senate is expected to vote on the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act today at approximately 8 P.M. EDT. However, its unclear whether the bill will pass or continue to face delays.
The GENIUS Act seeks to establish a federal regulatory framework for payment stablecoins, but has faced hurdles in progress in recent weeks due to a divide among lawmakers.
The debate came just over a week after a failed procedural vote, in which all 49 Democratic senators blocked a motion to invoke cloture on the bill’s consideration, halting its initial path to the floor.
In subsequent days, reports of a bipartisan effort to re-adapt the bill for another vote surfaced, resulting in changes to the proposal initially denied.
Democrats push back
While supporters say the bill would bolster US dollar dominance and provide critical oversight to a $250 billion market, opponents argue the latest draft contains broad loopholes for political figures and tech companies while creating security risks and insufficient consumer protections.
A May 19 memo by Senate Banking Committee Democratic staff accused the latest draft of enabling “Trump crypto corruption.” It references provisions that fail to bar elected officials, including President Donald Trump and his family, from owning or profiting from stablecoin ventures.
The memo claimed that the bill’s current language could allow Trump to benefit from the USD1 stablecoin, the token issued by a project endorsed by him and his family, World Liberty Financial.
The memo also warned of expanded loopholes for offshore issuers like Tether and private big tech firms. It noted that allowing the trading of stablecoins issued offshore on US-based exchanges could make it easier for criminals to move funds into the US financial system.
The document also stated that the draft still allows companies not predominantly engaged in financial services to issue their own stablecoins, with Elon Musk’s X mentioned as a potential beneficiary. It further argued that the exemption for private issuers undermines existing prohibitions on corporate currency issuance and poses systemic financial risks.
The memo concluded that the draft’s updates are “fig leaves,” restating existing protections without materially addressing national security concerns, sanctions enforcement, or misleading marketing by issuers.
Necessary first step
In contrast, bill proponents, including Senate Republicans, industry groups, and some moderate Democrats, framed the GENIUS Act as a needed legislative foundation.
Sen. Bill Hagerty (R-TN), the bill’s sponsor, described the legislation as pro-growth and “the first ever regulatory framework for payment stablecoins.” He argued it would strengthen the US dollar, increase demand for Treasury assets, and keep innovation onshore.
Bo Hines, executive director of the President’s Council of Advisers for Digital Assets, also voiced support, saying the legislation would modernize the financial system and provide Americans with faster and more affordable payment tools.
Amanda Tuminelli, executive director and chief legal officer of the DeFi Education Fund, issued a statement urging bipartisan support. She claimed regulatory clarity for stablecoins is in the best interest of the US dollar, American consumers, and small businesses.
Ji Kim, acting CEO of the Crypto Council for Innovation, said on May 19 that the vote is “a critical step to establish a regulatory framework for stablecoins that fosters responsible innovation” and that the legislation is essential for preserving US leadership in digital finance.
Support has also come from advocacy organizations like Stand With Crypto, which declared the Senate vote a “key vote” for its 52 million American members and urged constituents to pressure senators to back the bill.
Justin Slaughter, VP of regulatory affairs at Paradigm and a former Democratic staffer, offered a pragmatic endorsement, saying that this is “close to the best we can get for years and years.”
Slaugther added that while the bill isn’t perfect, it addresses the regulatory void surrounding stablecoins and mirrors the approach adopted by the EU, UK, and Japan.
