The Senate made big progress on stablecoin regulation Monday, advancing the GENIUS Act with a bipartisan vote of 66-32.
This bill, which would regulate stablecoins for the first time at the federal level, marks a key step toward establishing comprehensive oversight for digital currencies pegged to fiat currencies, like the US dollar.
The vote to advance the bill came after a week of intense negotiations. Sixteen Senate Democrats joined Republicans in support of the bill, overcoming a previous deadlock that had stalled the legislation two weeks ago.
Cloture Vote on GENIUS Act Sets Stage for Stablecoin Regulation
The critical procedural vote, known as cloture, was necessary to move the bill forward. However, a final vote on passage is not expected until after Memorial Day, 26 May, 2025.
The GENIUS Act is designed to create the first regulatory framework for stablecoin issuers, addressing issues of consumer protection, financial stability, and transparency.
While the bill is expected to provide clarity for issuers, it also includes new provisions on ethics standards for tech company leaders, which could impact high-profile figures like Elon Musk and David Sacks.
These changes helped to sway Democratic support after earlier resistance over national security and anti-money laundering concerns.
Key Senators Broker Deal on Amendments to GENIUS Act, Swaying Democratic Support
Key negotiators, including Senators Bill Hagerty, Cynthia Lummis, Mark Warner, Kirsten Gillibrand, Angela Alsobrooks, and Ruben Gallego, reached an agreement on amendments to the bill that added safeguards for consumers and restricted tech companies from issuing stablecoins.
The GENIUS Act is designed to create the first regulatory framework for stablecoin issuers. It aims to address issues of consumer protection, financial stability, and transparency.
This amendment has helped unlock support from Democrats who initially blocked the bill. According to sources, the amendment addresses some of their concerns. However, Democratic leaders have committed to backing the bill, even if it fails.
Despite bipartisan backing for the bill, some Republicans, including Senators Rand Paul and Jerry Moran, voted against advancing the legislation.
GENIUS Act Earlier Faced GOP Resistance Over National Security and Anti-Money Laundering Provisions
The bill’s journey has been complicated by previous opposition. Some Republicans, including Paul and Josh Hawley, have called for more robust provisions on national security and anti-money laundering measures.
Senate Majority Leader John Thune criticized the delay. He pointed out that the underlying bill had not changed since it was first blocked.
The GENIUS Act includes provisions to prevent conflicts of interest among public officials. One clause specifically prohibits any member of Congress or senior executive branch official from issuing a payment stablecoin product while in office. However, the bill does not restrict crypto ventures by private citizens. This includes ventures involving the Trump family, which has raised concerns among some Democrats.
While the road to final passage remains uncertain, the bill’s advancement signals growing momentum for stablecoin regulation in the US.
The GENIUS Act’s introduction could pave the way for clearer rules governing the growing crypto industry, particularly for stablecoin issuers, who have long operated in regulatory uncertainty.
The legislation’s next phase will involve final negotiations and potential adjustments before the Senate takes up the matter again after the Memorial Day break.
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