Senate Passes GENIUS Act, Clearing Hurdle for Federal Stablecoin Framework
The vote marks the first time the U.S. Senate has passed significant digital asset legislation and puts the industry one step closer to regulatory clarity for certain stablecoins.
On June 17, 2025, the Senate passed the Guiding and Establishing National Innovation for U.S. Stablecoins ("GENIUS") Act with a bipartisan 68–30 vote, marking a significant legislative milestone for the cryptocurrency industry. The bill's passage is a notable turnaround from May when it failed a cloture vote and left the industry uncertain about its prospects.
As discussed in our recent Commentary, "Updates on Proposed Stablecoin Legislation: the GENIUS Act and the STABLE Act," the bill, if enacted, will establish the first federal regulatory framework for certain issuers of U.S. dollar-pegged stablecoins that will be classified as "payment stablecoins" and which are neither commodities nor securities. Under the bill's definitions, payment stablecoins are digital assets: (i) designed to be used as a means of payment or settlement; (ii) with issuers who are obligated to (a) convert, redeem, or repurchase them for a fixed monetary value and (b) maintain a stable value relative to a fixed monetary value.
Payment stablecoin issuers, including banks, fintech companies, and major retailers, will be classified as financial institutions for anti-money laundering ("AML") purposes. They will also be subject to specific reserve, transparency, AML, and other compliance requirements. The bill grants the federal bank regulators broad authority to oversee payment stablecoin issuers—a logical result of the bill clarifying that payment stablecoins are not commodities or securities. However, payment stablecoin issuers with less than $10 billion in total issuances will have the option of being regulated by a state-level regulatory regime so long as the U.S. Department of Treasury determines that the state-level regulations are "substantially similar" to the federal framework.
The GENIUS Act now goes to the U.S. House of Representatives, where legislators are also considering the companion STABLE Act and the broader Digital Asset Market Clarity Act. Both pieces of House legislation have passed out of their respective committees—the STABLE Act in April 2025 and the Digital Asset Market Clarity Act in early June—but have not received floor votes.
