Breaking: Senate Showdown Over GENIUS Act—Will Crypto Face Tighter Controls?

Crypto''s fate hangs in the balance as the Senate prepares to vote on the controversial GENIUS Act. Will lawmakers clamp down on digital assets—or kick the can down the road (again)?

The bill promises sweeping oversight powers, but critics warn it could stifle innovation. Meanwhile, Wall Street quietly stacks BTC ETFs—hypocrisy at its finest.

Decision expected by EOD. Buckle up.

TLDR

• The US Senate is scheduled to vote today on the GENIUS Act regulating stablecoins.
• The bill requires stablecoins to be fully backed by US dollars or liquid assets.
• It prohibits non-financial public companies from issuing stablecoins without meeting strict compliance standards.
• The legislation gained bipartisan support after amendments addressed Democratic concerns.
• New rules require government officials to disclose if they hold over $5,000 in stablecoins.

Lawmakers in the United States Senate are prepared to vote on the GENIUS Act, a comprehensive stablecoin regulation bill. The vote follows weeks of legislative debate, cloture motions, and bill amendments that moved the act closer to passage. The measure, officially called the Guiding and Establishing National Innovation for U.S. Stablecoins Act, faces its decisive moment today.

The Senate advanced the GENIUS Act last week through a cloture vote, signaling bipartisan momentum behind the legislation. The measure received 68 votes in favor, with support from 18 Democrats, surpassing the 60-vote threshold. This shift came after several provisions were revised to satisfy concerns raised by Democratic lawmakers.

The GENIUS Act aims to create a strict regulatory structure for payment stablecoins issued within or affecting the United States market. It mandates full dollar reserves, applies annual audits to large issuers, and enforces new rules on foreign-backed coins. The legislation also restricts corporate stablecoin issuance by non-financial public companies unless they meet new compliance standards.

Regulation Details and Market Impact

The bill requires stablecoin issuers with assets above $50 billion to undergo yearly independent audits. Issuers must maintain full backing with U.S. dollars or equivalent liquid assets to ensure redemption stability. The bill also introduces legal protections for stablecoin holders during potential insolvencies.

Consumers gain priority over other creditors in bankruptcy, enhancing market confidence and safeguarding digital dollar stability. Furthermore, the bill enforces disclosure requirements for government officials owning over $5,000 in stablecoins. This provision seeks to increase transparency and reduce conflicts of interest across regulatory bodies.

Companies like Meta and Amazon would be blocked from issuing stablecoins unless they meet designated financial risk and consumer privacy benchmarks. Lawmakers added these restrictions to address potential systemic threats from tech firms entering the monetary space. Issuers must also comply with anti-money laundering protocols and ensure cross-border transparency.

Political Dynamics and Trump Affiliations

The legislation faced earlier delays due to concerns over stablecoin involvement by entities linked to former President Donald Trump. His affiliated company, World Liberty Financial, recently launched a stablecoin now ranked fifth globally. Senate Democrats cited the potential for foreign misuse through such private issuers as a major concern.

To address this, the bill prohibits active members of Congress and executive branch officials from issuing or directly owning stablecoins. However, due to constitutional constraints, it stops short of targeting relatives or business ventures of public figures. These limits prevent the bill from directly regulating Trump’s adult children involved in stablecoin initiatives.

Senator Elizabeth Warren raised concerns about foreign investors exploiting Trump-related crypto platforms. The final version includes a clause referencing the Emoluments Clause to reinforce ethics compliance. Yet, the bill does not directly regulate entities outside current official roles.

GENIUS Act Gains Edge Over STABLE Act

The House of Representatives has advanced its own stablecoin proposal, the STABLE Act, with different approaches to state-level oversight. The House Financial Services Committee approved it in May, but the full chamber has yet to vote. Due to Senate momentum, the House may prioritize the GENIUS Act instead.

Analysts believe the GENIUS Act reflects a broader bipartisan consensus, aligning more closely with what can pass both chambers. The STABLE Act’s divergence from GENIUS may delay negotiations if pursued independently. If the Senate passes GENIUS, House leaders are expected to respond quickly.