Today, Chairman Tim Scott (R-S.C.) joined Senate Banking Committee members Senators Bill Hagerty (R-Tenn.) and Cynthia Lummis (R-Wyo.), as well as Senator Kirsten Gillibrand (D-N.Y.), in introducing the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, legislation to establish a clear regulatory framework for payment stablecoins.
“Stablecoins enable faster, cheaper, and competitive transactions in our digital world and facilitate seamless cross-border payments,” said Chairman Scott. “This legislation will expand financial inclusion and provide much-needed clarity to ensure the industry can innovate and grow here in the United States, while protecting consumers and promoting the U.S. dollar’s global position. I look forward to working with our colleagues – including House Financial Services Chairman French Hill – to advance this legislation to President Trump’s desk.”
“From enhancing transaction efficiency to driving demand for U.S. Treasuries, the potential benefits of strong stablecoin innovation are immense,” said Senator Hagerty. “My legislation establishes a safe and pro-growth regulatory framework that will unleash innovation and advance the President’s mission to make America the world capital of crypto. I look forward to working with Chairman French Hill and the House Financial Services Committee to get it to the President’s desk and signed into law.”
“Creating a bipartisan regulatory framework for stablecoins is critical to maintaining the U.S.’s dollar dominance and promoting responsible financial innovation,” said Senator Lummis. “I’m proud to support Sen. Hagerty’s important legislation, which goes a long way towards protecting Wyoming’s regulatory framework for digital assets, and ensures stablecoin issuers have a real choice when it comes to a state or national charter.”
“Passing clear and sensible regulations for stablecoins is critical to maintaining U.S. dollar dominance, promoting responsible innovation, and protecting consumers,” said Senator Gillibrand. “The bipartisan Guiding and Establishing National Innovation for U.S. Stablecoins Act protects consumers by requiring stablecoin issuers to maintain one-to-one reserves; prohibiting algorithmic stablecoins; and requiring issuers to comply with U.S. anti-money-laundering and sanctions rules. Importantly, it will empower responsible innovation, maintain U.S. leadership in digital assets and blockchain technology, and keep crypto companies and jobs onshore. The future of stablecoins and cryptocurrency has strong bipartisan support—I’m proud to introduce this bill with Senators Hagerty, Lummis and Scott, and look forward to working together to pass this important legislation.”
BACKGROUND:
Dollar-denominated payment stablecoins are digital assets pegged to the U.S. dollar. They can improve transaction efficiency, expand financial inclusion, and strengthen the dollar’s supremacy as the world reserve currency by driving demand for U.S. Treasuries. The previous administration’s hostility toward crypto and refusal to provide clear regulatory guidelines has severely stifled stablecoin innovation.
The GENIUS Act:
- Defines a payment stablecoin as a digital asset used for payment or settlement that is pegged to a fixed monetary value;
- Establishes clear procedures for institutions seeking licenses to issue stablecoins;
- Implements reserve requirements and light-touch, tailored regulatory standards for stablecoin issuers;
- For issuers of more than $10 billion of stablecoins, applies the Federal Reserve’s regulatory framework to depository institutions and the Office of the Comptroller of the Currency’s framework for nonbank issuers;
- Allows for state regulation of issuers under $10 billion in market capitalization and provides a waiver process for issuers exceeding the threshold to remain state-regulated; and
- Establishes supervisory, examination, and enforcement regimes with clear limitations.
Full text of the GENIUS Act can be found here. A one-page overview of the legislation can be found here.