Senate Banking Committee passes GENIUS Act with bipartisan support, advancing stablecoin regulation

The Senate Banking Committee passed the GENIUS Act with bipartisan support on an 18-6 vote, clearing the bill for the full Senate to consider.

Senator Bill Hagerty authored the bill, which received the backing of all Republican members of the Committee and Democratic Senators Mark Warner, Andy Kim, Lisa Blunt Rochester, Ruben Gallego, and Angela Alsobrooks.

Hagertyhis satisfaction with the bill’s bipartisan support, emphasizing its importance in fostering financial innovation and maintaining the US’s leadership in digital assets.

He added: 

The GENIUS Act seeks to establish a comprehensive regulatory framework for stablecoin issuance and oversight in the United States. Under the proposed law, stablecoin issuers must maintain 1:1 reserves, ensuring that US dollars, insured bank deposits, or short-term Treasury bills back each issued token. 

The bill also creates a dual regulatory pathway, allowing issuers to choose between federal oversight under the Office of the Comptroller of the Currency (OCC) or state-level supervision, provided that state regulations meet federal standards. 

Committee Chairman Senator Tim Scott also highlighted the importance of regulatory clarity, stating that certain industries and American consumers have been in the dark for far too long. 

Scott added:

The Committee Chairman also said the bill takes action to “end the weaponization of financial regulators.” 

This statement could relate to the bill’s content, which explicitly classifies stablecoins as non-securities. This places them outside the jurisdiction of the Securities and Exchange Commission (SEC), which is known for its previous “regulation by enforcement” approach.

Positive reactions

Senator Cynthia Lummis, a vocal advocate for crypto regulation and member of the Committee,that the bill’s passage out of the Committee strengthens the regulatory framework for stablecoin issuers. 

She added that the bill gives the US a “competitive edge in the rapidly evolving digital asset space.”

Circle CEO Jeremy Allairethe Committee vote a “massive move in Washington today,” highlighting the decision’s bipartisan nature. He also noted that it is a “huge step towards upgrading and making the dollar more competitive.”

Coinbase chief policy officer Faryar Shirzadthe bill’s progress and thanked the senators who supported it.

Blockchain Association CEO Kristin Smiththe decision, stating that the passage of the GENIUS Act is a smart step in the right direction for American innovation and economic leadership.

The bill is now moving to the full Senate for a vote. If enacted, the legislation would provide long-awaited clarity for stablecoin issuers and users, reinforcing the US’ role as a leader in digital currency regulation.