The US has made significant strides toward becoming the world’s “crypto capital” as the stablecoin bill, the GENIUS Act, advances toward a full Senate vote.
Sen. Bill Hagerty, who sponsored the bill, called it a “crucial first step” in establishing a “safe and pro-growth regulatory framework” in a post on the social media platform X.
An 18-6 vote in the Senate Banking Committee saw the Act approved, gaining notable momentum following US President Donald Trump’s endorsement, who identified it as a key priority.
The bill aims to create a regulatory balance between state and federal oversight, allowing smaller issuers to operate under state supervision while bringing larger stablecoin providers under federal jurisdiction.
Stablecoins are considered the least volatile form of cryptocurrency since they are pegged to fiat currencies like the US dollar. Their primary use is in cross-border transactions, offering the speed and security of blockchain technology while maintaining a stable value.
Even traditional financial institutions, often cautious of crypto, have shown interest in stablecoins. The Bank of America expressed plans earlier this month to enter the stablecoin market but is waiting for regulatory clarity before proceeding.
However, the details of the proposed legislation have raised concerns. Before the bill’s vote, Sen. Elizabeth Warren criticised it for lacking essential consumer protections.
She said: “The bill ignores basic consumer protections that apply to every other financial product available in America.”
A major concern among financial institutions is crypto’s susceptibility to criminal activity, highlighted by Warren: “In fact, the bill even invites scammers into the market by refusing to prohibit people convicted of fraud and money laundering from owning stablecoin companies.”
She also pointed out the bill’s lack of national security safeguards. Despite these points – and even warning that “Elon Musk would love to issue his own currency” to compete with the US dollar – Warren suggested she might support the legislation if key compromises are made.
Looking ahead, the bill will need to pass a vote in both the Senate and the House before reaching Trump for final approval.
