Senate Passes GENIUS Act To Allow Trading In Dollar-Pegged Stablecoins

“A thriving stablecoin ecosystem will drive demand from the private sector for US Treasuries, which back stablecoins,” U.S. Treasury Secretary Scott Bessent said in a statement. “This newfound demand could lower government borrowing costs and help rein in the national debt. It could also onramp millions of new users—across the globe—to the dollar-based digital asset economy.”

The bill attracted support from major commercial and investment banks, as well as leading retailers, including Walmart, Target, and Amazon.  All three retailers have expressed interest in issuing their own stablecoins once the regulatory landscape is clear, attracted by the potential to bypass costly traditional payment processing systems, and to collecting data on customer spending behavior.

Passage of the bill was a long time in coming. The measure failed a key procedural vote in May, when Democrats demanded changes to curb President Trump and the Trump family’s fast-growing involvement in crypto trading, including issuing their own stablecoin. Some limits on that activity by executive branch officials were added to the bill to lure enough Democrats into supporting the overall measure. But it still allows the president, the vice president, and their families to engage in stablecoin-related ventures while in office.

Related: Stablecoin Payments in the U.S. and the EU: Regulatory Considerations and Market Dynamics Following Stripe’s Acquisition of Bridge

“Passing the GENIUS Act without strong anti-corruption measures stamps a Congressional seal of approval on President Trump selling access to the government for personal profit,” Senator Jeff Merkely (D-OR) said in a press release criticizing passage of the bill. “Trump’s ‘Government for Sale’ enterprise is the Mount Everest of corruption—the conflicts of interest and ethics violations are clear as day.”

Another, anti-monopoly provision was added to prohibit non-financial tech giants from issuing their own stablecoins unless they establish or partner with a regulated financial entity.

The bill faces uncertain prospects in the House, which has its own stablecoin bill dubbed STABLE. While similar in intent, the two bills would establish different regulatory structures for stablecoins. The Senate bill centralizes oversight in the Treasure Department, while the House bill divides oversight among the SEC, the Comptroller of the Currency, and the Federal Reserve.

The House also recently advanced the CLARITY Act, intended to establish a clear market structure for digital assets. Rather than voting to approve the Senate GENIUS Act, some in the House could favor combining the various bills in a single, omnibus crypto measure, setting up a showdown between the two chambers and delaying final approval of a stablecoin measure beyond Congress’ self-imposed deadline of July 4^th.

Still, Rep. French Hill (R-AZ), chair of the House Financial Services Committee that recently approved the CLARITY Act, applauded the Senate’s passage of the GENIUS Act.

“Clear rules of the road for stablecoins are long overdue, and today we’re one step closer to creating a functional regulatory framework,” he said in a statement issued by the committee majority’s communications office. “I applaud the Senate’s passage of the GENIUS Act and the work of Chairman Scott, Senator Hagerty, and Senator Lummis to make this historic day a reality. I look forward to working with my House colleagues to bring much-needed clarity and protections to the digital asset ecosystem.”