GENIUS Stablecoin Regulation Bill cleared a critical Senate hurdle on May 19, 2025, with a 66-32 vote, paving the way for full floor debate. This milestone, following a failed attempt two weeks prior, marks a significant step toward establishing a federal framework for stablecoin oversight in the U.S. This article explores the bill’s provisions, bipartisan negotiations, and its implications for the crypto market.
A Landmark Regulatory Framework
GENIUS Stablecoin Regulation Bill, led by Senator Bill Hagerty and co-sponsored by Tim Scott, Kirsten Gillibrand, Cynthia Lummis, and Angela Alsobrooks, aims to create the first federal stablecoin oversight structure. Key requirements include:
- 100% backing of stablecoins with USD or equivalent liquid assets.
- Annual audits for issuers with over $50 billion in market cap.
- A ban on foreign-issued stablecoins in the U.S., though secondary market circulation is permitted.
- Treasury authority to act against non-compliant foreign issuers.
The bill seeks to balance innovation with consumer protection, ensuring the U.S. dollar’s global dominance while fostering blockchain innovation. Hagerty stated on X, “This vote is a historic opportunity to pass foundational digital asset legislation, protecting consumers and reinforcing America’s technological leadership.”
Read more: Stage: GENIUS Act Could Reinforce USD Global Dominance
Democrats Shift Support After Amendments
GENIUS Stablecoin Regulation Bill initially faced fierce Democratic opposition on May 8, 2025, when all Senate Democrats voted against it, citing concerns over:
- Insufficient oversight of foreign issuers.
- Weak anti-money laundering (AML) standards.
- Potential conflicts of interest tied to former President Donald Trump’s crypto ventures.
- Risks from allowing Big Tech to issue stablecoins.
Within two weeks, bipartisan negotiations yielded amendments that flipped Democratic votes. Key changes include:
- Conflict-of-interest rules for senior federal officials, excluding the president and vice president.
- Restrictions on Big Tech issuing stablecoins if they mishandle sensitive user financial data.
- Strengthened national security and consumer protection measures.
These concessions swayed Democrats like Ruben Gallego, Mark Warner, and Kirsten Gillibrand, securing the 60 votes needed for cloture. Senator Lummis noted the goal is to finalize the bill by May 26, 2025, advancing blockchain innovation in the crypto market.
Ongoing Controversies and Next Steps
GENIUS Stablecoin Regulation Bill remains contentious, particularly over exemptions for the president and vice president. Senator Elizabeth Warren criticized the bill, arguing it fails to address Trump’s ties to World Liberty Financial’s USD1 stablecoin, launched in April 2025 with a $2 billion market cap. Warren warned, “This bill fuels Trump’s crypto profits by amplifying the stablecoin market’s scale.”
Despite objections, the bill’s bipartisan support signals progress. After Senate debate and a final vote, it will move to the House. If passed, President Trump could sign it into law, aligning with his administration’s push for stablecoin oversight. However, Warren’s concerns highlight the need for further scrutiny to ensure transparency in the crypto market.
Conclusion
GENIUS Stablecoin Regulation Bill marks a pivotal moment for U.S. blockchain innovation, balancing consumer protection with regulatory clarity. With bipartisan backing, it advances toward becoming law, though debates over exemptions persist. As the crypto market grows, this bill could solidify America’s leadership in digital finance.
