Committee Approval Marks a Major Step Toward Federal Stablecoin Regulation
The U.S. Senate Banking Committee has approved the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act) with an 18-6 vote, bringing stablecoin regulation closer to becoming law. The bill aims to create a federal framework for stablecoin issuers and digital asset oversight and now moves to the full Senate for consideration.
Legislative Hurdles Remain as House Version Awaits Passage
While the committee’s approval is a significant milestone, the GENIUS Act still faces additional legislative steps. A similar version of the bill is pending in the House of Representatives, and both chambers must reconcile their differences before it can reach President Donald Trump’s desk. If enacted, the bill would introduce a nationwide regulatory structure for stablecoins, a long-anticipated development for the U.S. crypto industry.
Warren Warns of Security Risks, Republicans Push for Regulatory Clarity
Despite bipartisan backing, Senator Elizabeth Warren (D-MA) opposed the bill, citing national security concerns and raising issues about alleged ties between Trump’s family business, World Liberty Financial, and Binance. According to a Wall Street Journal report, Binance allegedly sought a presidential pardon for founder Changpeng Zhao (CZ) in exchange for a business deal—an accusation that CZ has denied.
Meanwhile, Senator Tim Scott (R-SC), chair of the Banking Committee, defended the bill, arguing that clear regulations would encourage innovation within the U.S. rather than drive crypto firms abroad. Scott emphasized that the GENIUS Act would offer regulatory clarity for stablecoin issuers while strengthening the domestic digital asset market.
Bipartisan Amendments Aim to Enhance Consumer Protections
Before advancing the bill, the committee adopted bipartisan amendments to address concerns from both parties. These include:
- A ban on misleading stablecoin names
- Clearer definitions for non-permitted stablecoin issuers
- A rule prioritizing stablecoin customers over creditors in bankruptcy cases
These amendments aim to balance innovation with investor protection, ensuring that stablecoin issuers operate within a transparent and well-defined regulatory framework.
Crypto Leaders Welcome Progress, Highlight Economic Benefits
Following the committee’s approval, Circle CEO Jeremy Allaire praised the bill’s advancement, stressing that regulatory clarity is essential for strengthening the U.S. stablecoin market. Senator Bill Hagerty (R-TN) echoed this sentiment, noting that a stablecoin framework would enhance transaction efficiency, improve capital flow, and drive demand for U.S. Treasury assets.
What’s Next for the GENIUS Act?
As the GENIUS Act moves toward a final vote in the Senate, its implications for stablecoin regulation, financial innovation, and digital asset oversight remain a key focus for policymakers and industry leaders alike.
