The Contested GENIUS Act: A Battle Over U.S. Stablecoins
Democratic Party Member Expresses Apprehensions Regarding Digital Currency Company Tether
The GENIUS Act, a proposed bill aiming to establish a regulatory framework for U.S. payment stablecoins, has hit a stumbling block. In the limelight now is Senate Minority Leader Chuck Schumer's concern about the treatment of Tether, the leading stablecoin issuer, within the bill.
Schumer has signaled he'd rather not show public support for the bill, looking to leverage potential future concessions from the Republicans. Back in March, Democratic Senators including crypto critic Elizabeth Warren proposed a series of amendments to the bill, focusing on national security and illicit finance, as reported by Axios.
One such amendment aimed to bar foreign-issued stablecoins from operating within the U.S., a move that could severely impact Tether, the dominant player in the stablecoin market. However, this amendment was shot down by Republicans, allowing the bill to successfully proceed through the Senate Banking Committee in March.
Recent reports from Politico suggest that some crypto-friendly Democrats, whose votes are essential for passing stablecoin legislation, have turned wary of the bill. The Republicans were planning to push for a full Senate vote before Memorial Day, but this reluctance from some Democrats, such as Arizona Senator Ruben Gallego, could pose a significant hurdle.
Punchbowl News informs us of an emerging rift among Senate Democrats, which came to light during their lunch meeting. Crypto-friendly voices within the opposition party have expressed doubts due to this rift.
Meanwhile, the GENIUS Act, introduced by Senator Bill Hagerty on February 4, 2025, proposes a framework that requires stablecoin issuers to back each token 1:1 with U.S. dollars, insured bank deposits, or short-term Treasury bills. Issuers can choose between federal oversight under the Office of the Comptroller of the Currency (OCC) and state-level supervision. Despite initial progress, the bill faces potential delays and the possibility of concessions.
[1] https://www.cnbc.com/2022/02/04/senator-hagerty-introduces-genius-act-on-crypto-stablecoins.html[2] https://www.politico.com/news/2022/03/02/senate- committee-approves-stablecoin-bill-500487[3] https://www.axios.com/2023/04/13/democrats-grow- skeptical-stablecoin-bill- bytes.html[4] https://www.punchbowl.news/newsletters/2024/04/15/ fu2_535[5] https://www.coindesk.com/policy/2023/03/04/ senate-stablecoin-bill-digs-deeper-into- foreign-currency-issues/
- The GENIUS Act, a bill aiming to establish a regulatory framework for U.S. payment stablecoins, has faced opposition from Senate Minority Leader Chuck Schumer due to concerns about Tether, the leading stablecoin issuer.
- In March, Democratic Senators including crypto critic Elizabeth Warren proposed a series of amendments to the GENIUS Act, focusing on national security and illicit finance.
- One amendment aimed to bar foreign-issued stablecoins from operating within the U.S., a move that could severely impact Tether, the dominant player in the stablecoin market.
- However, this amendment was shot down by Republicans, allowing the bill to successfully proceed through the Senate Banking Committee in March.
- Recent reports from Politico suggest that some crypto-friendly Democrats have turned wary of the bill due to a rift among Senate Democrats, which could pose a significant hurdle for passing stablecoin legislation.
- The GENIUS Act proposes a framework that requires stablecoin issuers to back each token 1:1 with U.S. dollars, insured bank deposits, or short-term Treasury bills. Issuers can choose between federal oversight under the Office of the Comptroller of the Currency (OCC) and state-level supervision.
- Despite initial progress, the bill faces potential delays and the possibility of concessions, as it navigates the complexities of policy-and-legislation, politics, and general-news, including the bull run of cryptocurrencies like bitcoin and the roles of stablecoins like Tether.
