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Stablecoins are one of the most important areas of innovation in crypto. And now, there’s new policies forming in Washington, D.C. to regulate them for the first time ever.
What’s happening:
- Stablecoin regulatory bill the GENIUS Act has officially been passed in the United States Senate
Why it matters:
- This is the first time in American history that a major federal law has been passed focused on regulating stablecoins that are pegged to the U.S. dollar
Going deeper:
- The GENIUS Acts lays out a clear regulatory framework for stablecoin issuers, including the need for full U.S. dollar backing, transparency around audits and limitations on what type of technology companies can actually issue their own stablecoins
- The GENIUS Act also lays out a very simple framework for protecting users of stablecoins and ensuring any American citizens using stablecoins would have priority in case of a stablecoin issuer going bankrupt or insolvent
The intrigue:
- Stablecoins continue to be an emerging theme in both the private and public markets, with Trump family founded World Liberty Financial just rolling out their own stablecoin USD1 and Circle Internet Group (NYSE: CRCL) debuting on the New York Stock Exchange in a notable billion dollar IPO
The fine print:
- The GENIUS Act still ultimately needs to go to the House of Representatives for another vote before it can be signed into law by President Donald Trump
