U.S. Senate Passes Important New Law to Regulate Stablecoins, Called the GENIUS Act

The Senate passed the GENIUS Act on June 17, with 51 senators voting yes and 23 voting no. Now, the bill will move to the House of Representatives for review.

Before this, on June 11, the Senate voted 68-30 to end debate and start the final countdown to the vote.

Senator Bill Hagerty from Tennessee, who leads the bill, called the vote a “big win for the United States.” He said on social media that the GENIUS Act creates the first rules that support growth for payment stablecoins.

He explained that the bill will help keep the US dollar strong, protect customers, increase demand for US government bonds (called Treasuries), and make sure digital money innovation stays in the US, not with other countries.

Stablecoins are digital money tied one-to-one with cash or short-term Treasuries. Hagerty said this mix of the dollar’s stability and fast blockchain technology will allow businesses and people to make payments almost instantly, changing how payments work.

He also said stablecoin companies could become the biggest holders of US Treasuries by 2030, which would help the country’s financial strength.

The GENIUS Act requires every payment stablecoin to have reserves equal to the number of tokens it issues. These reserves can only be in short-term US Treasuries or insured bank deposits, and stablecoin companies can’t pay interest to customers.

The reserves must be kept separate from the companies’ other money. Companies must follow rules to prevent illegal activity, check customers carefully, and report suspicious actions.

If a stablecoin company owes more than $10 billion, it must get a federal license. Smaller companies can follow state rules that meet federal standards, and federal regulators will check on them together.

The Treasury Department will also have to publish reports every three months, and the Commodity Futures Trading Commission (CFTC) will get some power to enforce rules in the market.

Treasury Secretary Scott Bessent said the reserve rules might encourage people to buy more Treasury bills, lower borrowing costs, and introduce millions of people worldwide to digital dollar payments.

With the Senate’s approval, the GENIUS Act now waits for the House to take it up.