What is the GENIUS Act?
A new U.S. federal law regulating stablecoins – digital currencies pegged to the U.S. dollar – aimed at providing transparency, protecting consumers, and reducing financial risks.
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🔑 Key Provisions of the Law:
1. Financial Reserves:
Issuers of stablecoins must hold 100% cash reserves, such as dollars or short-term treasury bonds.
2. Transparency and Auditing:
Large companies (with a market cap over $50 billion) are obligated to provide audited financial reports annually.
Monthly disclosures about the composition of reserves.
3. Consumer Protection:
Providing misleading information is prohibited, such as claiming that the currencies are government-backed or FDIC insured.
4. Issuance Conditions:
Only licensed U.S. companies can issue backed stablecoins.
5. In the Event of Bankruptcy:
Stablecoin holders receive priority in repayment compared to other creditors.
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🏛️ Legislative Status:
Approved in the Senate on June 17, 2025, by a vote of 68 in favor and 30 against.
Awaiting discussion in the House of Representatives, and then the President (Trump) to sign it into law.
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⚠️ Opposition:
Some Democrats (like Elizabeth Warren) opposed the law, citing concerns over:
Risks to financial stability.
Weak anti-money laundering measures.
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