The United States Senate is poised to hold a decisive vote on the GENIUS Act
The United States Senate is poised to hold a decisive vote on the GENIUS Act, a piece of legislation with the potential to significantly impact the cryptocurrency market, particularly stablecoins. This vote, scheduled for June 17, aims to establish the regulatory framework for stablecoins within the U.S. and across the globe. According to the Democratic Party’s official website, the date was finalized in a Thursday announcement, wherein it mentioned that the exact timing of the vote would be determined through consultation between the Majority Leader and the Democratic Leader. The bill mandates that stablecoins be fully backed by the U.S. dollar or similar liquid assets, introduces regulatory oversight for major issuers, and sets compliance rules for foreign stablecoin companies.
Key Regulations Proposed by the GENIUS Act
The GENIUS Act, aimed at ensuring the safe operation of stablecoins within the U.S. financial system, introduces several critical regulations. Foremost among these is the requirement for all stablecoin issuers to fully back their coins with U.S. dollars or assets possessing equivalent liquidity. This stipulation is designed to ensure the financial stability and trustworthiness of stablecoin projects.
Secondly, the Act stipulates that issuers with a market value exceeding $50 billion must undergo annual independent audits. This requirement is intended to assure the market of the financial health and transparency of large-scale stablecoin projects. Additionally, companies operating outside the U.S., such as those like Tether (USDT), which hold a significant share in the global market, will need to comply with determined standards.
The Legislative Journey of the GENIUS Act
An initial vote in the Senate on Wednesday enabled the bill to advance to the final vote. If the GENIUS Act passes the Senate, it will then move to the House of Representatives. However, negotiations will be necessary here, as the House Financial Services Committee has its stablecoin bill, the STABLE Act, which passed in May.
There are notable differences between the two chambers’ bills, particularly concerning whether stablecoin issuers should be regulated at the state or federal level and how foreign issuers should be overseen. These discrepancies will need reconciliation. President Donald Trump’s explicit support for passing the bill before August has expedited the process.
Treasury Secretary Scott Bessent, in a statement this week, projected that successful regulation could propel the U.S. dollar-backed stablecoin market to exceed $2 trillion by 2028. Currently, the stablecoin market’s size is approximately $252 billion, according to CoinGecko.