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Coinpaprika 2025-02-05 08:47:19

Senator Hagerty Unveils GENIUS Act to Regulate Stablecoins

US Senator Bill Hagerty has introduced the GENIUS Act , a new bill aiming to regulate payment stablecoins and strengthen the US dollar’s dominance. This follows an earlier discussion draft in October and represents a major step toward a clear legal framework for stablecoin transactions. The GENIUS Act defines a payment stablecoin as a digital asset used for payments or settlements, pegged to a fixed value. The bill requires these stablecoins to be backed by US currency, insured demand deposits, Treasury bills, and other approved assets. It also introduces strict oversight based on market value—issuers worth over $10 billion will fall under Federal Reserve regulation, following banking rules. Meanwhile, non-bank issuers will be monitored by the Office of the Comptroller of the Currency. Issuers below this threshold will be regulated by state authorities but may apply for exemption. Currently, only Tether ( USDT ) and USD Coin (USDC) exceed the $10 billion market cap requirement. The bill also mandates monthly audits of stablecoin reserves, with penalties for false reporting. Clear licensing procedures, reserve requirements, and enforcement mechanisms are detailed to ensure compliance. Senator Hagerty has emphasized the benefits of stablecoins, stating they could improve payment efficiency and increase demand for US Treasuries. He believes strong stablecoin development will have a wide-ranging impact. “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,” he said. The bill is co-sponsored by Senators Kirsten Gillibrand, Tim Scott, and Cynthia Lummis . Lummis highlighted that 2025 is a crucial year for digital assets, urging the US to take the lead in setting stablecoin regulations. She stressed that a bipartisan framework is essential to maintaining the US dollar’s global dominance and fostering responsible financial growth. Fox Business reporter Eleanor Terrett has indicated that Senate staffers expect the bill to move swiftly through congressional committees. The discussion follows a February 4 press conference , where David Sacks, the White House’s AI and crypto advisor, expressed support for stablecoin legislation. Sacks and other House leaders have confirmed that regulating stablecoins will be a priority in the near future.

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