On Tuesday (June 17), that wish got one step closer to reality with the Senate passing the GENIUS Act, an acronym for Guiding and Establishing National Innovation for U.S. Stablecoins of 2025 Act, in a 68-30 vote.
“Today is a bold step forward – not just for financial innovation, but for American leadership, consumer protection, and economic opportunity. With the GENIUS Act, we’re bringing clarity to a sector that’s been clouded by uncertainty and proving that bipartisan, principled leadership can still deliver real results for the American people,” said U.S. Senate Banking Committee Chairman Tim Scott, R-S.C., in a statement.
“Clear rules of the road for stablecoins are long overdue, and today we’re one step closer to creating a functional regulatory framework … I look forward to working with my House colleagues to bring much-needed clarity and protections to the digital asset ecosystem,” said House Committee on Financial Services Chairman French Hill, R-Ariz., in a statement provided to PYMNTS.
The vote mirrored the bipartisan divide of last week’s (June 11) vote where the Senate, after a 68 to 30 procedural vote, eliminated some of the more-than 10 dozen proposed amendments to the GENIUS Act.
Still, before reaching Trump’s desk, the bill must clear the House, where the August recess begins in around 50 days. But the political theater surrounding what could be the passage of the first-ever crypto framework in the U.S, the global implications for dollar-backed digital currencies and the growing institutional embrace of blockchain infrastructure tell a much larger story about rewriting the architecture of money itself.
Read more: Are Closed-Loop Financial Instruments the Future of Institutional Stablecoins?
Implications for Financial Services and Payments
The momentum behind the GENIUS Act is increasingly being taken as a sign of approval by the broader crypto and traditional financial spaces. The stablecoin issuer Circle, for example, has gone public on the NYSE, while corporate interest in stablecoins is no longer theoretical. Major financial institutions including Bank of America (BofA), Wells Fargo and Citigroup are exploring the launch of a jointly operated stablecoin.
On Tuesday afternoon, JPMorgan announced that it is planning to offer its own stablecoin, JPMD.
“Everybody’s jumping into stablecoins right now,” Brett McLain, head of payments and blockchain at Kraken, told PYMNTS. “All the big banks, they’re talking about creating their own; others want to leverage existing ones.
Retail giants like Walmart and Amazon are exploring embedded payments powered by stablecoins. And global banks from Société Générale to Banco Santander are experimenting with cross-border liquidity management using on-chain dollar tokens. The passage of the GENIUS Act removes a major barrier to entry — legal risk — and adds institutional-grade legitimacy to what was once a speculative fringe technology.
The creation of a federal framework governing stablecoins is important for industry confidence, Chainalysis Co-founder and CEO Jonathan Levin said in an interview with PYMNTS CEO Karen Webster published April 7.
The marketplace, in turn, is responding with vigor. OpenPayd and Circle on Tuesday partnered to offer global businesses a unified fiat and stablecoin infrastructure layer. Also on Tuesday, digital asset startup Ubyx raised $10 million to promote what it calls “stablecoin ubiquity.”
See also: Crypto Firms Grapple With Bank-Like Risks, Without the Regulation
Understanding the Risks to Financial Stability and Markets
But the scale of this policy shift is not without the potential for systemic risk impacting the rest of the financial landscape. Observers warn that stablecoins could divert deposits away from traditional banks, particularly smaller institutions that rely on low-cost, sticky retail deposits.
Liquidity flight into stablecoins, especially those issued by large tech or financial conglomerates, could destabilize the deposit base and erode the traditional bank funding model. There are also concerns around monetary sovereignty, privacy and surveillance — issues that have dogged similar proposals globally.
At the same time, the backing and reserves of stablecoins have also come into question, although the regulations seek to mollify this by requiring stablecoins to be backed 1:1 by U.S. Treasuries, issued by regulated entities and subject to audits/AML. There is, however, a loophole protecting presidential issuers that Democrats are still seeking to close.
Some lawmakers have suggested merging the GENIUS Act with broader legislation like the CLARITY Act, which seeks to define most cryptocurrencies as non-securities. Such bundling could delay implementation or fracture the fragile bipartisan consensus. But if the House moves swiftly and President Trump signs the bill — as he is widely expected to — the law could take effect before the end of summer.
Should the law be passed, its implications will be enduring. The GENIUS Act sets a precedent not just for how digital currencies are managed, but for how future innovations in finance will be legislated. By codifying clear, enforceable rules without relying on government issuance, it signals a new era in which private enterprise could play a new role in the evolution of money.
