The US Congress has concluded its Crypto Week with the passage of the GENIUS Act and is sending other bills to the Senate after successful votes and no small amount of deliberation.
The US crypto industry was jubilant as the House of Representatives passed the GENIUS Act — the industry’s flagship stablecoin bill — and sent it to the president’s desk for his signature. The stablecoin bill received bipartisan support after several rounds of revisions.
The House also passed the CLARITY Act, the long-awaited market structure bill championed by the blockchain industry, as well as Republican Representative Tom Emmer’s bill that would ban the Federal Reserve from issuing a central bank digital currency (CBDC).
The latter two bills will head to the Senate, where the slimmer pro-crypto Republican majority could mean more deliberation and amendments before they get passed.
Crypto Week puts GENIUS Act on President Trump’s desk
The Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act is now heading to the White House, where US President Donald Trump is expected to sign it at 2:30 pm local time on Friday.
The law will come into effect 18 months after Trump signs it or 120 days after “primary federal payment stablecoin regulators” (i.e., the US Treasury and Federal Reserve) publish the final regulations implementing the GENIUS Act.
Once in full effect, stablecoin issues will be held to a number of standards, including strict reserve requirements and being subject to the Bank Secrecy Act.
Logan Payne, a crypto-focused lawyer at Winston & Strawn, previously told Cointelegraph that GENIUS will compel many American stablecoin issuers to become banks.
Related: Trump eyes executive order to open up retirement funds to crypto: FT
Stablecoin issuers under the GENIUS Act are limited solely to that activity. However, most US stablecoin issuers already offer more services than just making stablecoins. Per Payne, they’ll want to pursue a bank charter, which allows them to issue stablecoins “plus a wider range of activities, but without having to get state-to-state licenses.”
The crypto industry didn’t get everything it wanted in the GENIUS Act. Coinbase CEO Brian Armstrong was adamant that lawmakers include a provision for stablecoin issuers to offer interest on customer stablecoin reserves.
Armstrong argued that “onchain interest democratizes access to the market rate yield rate, giving regular people a fair shot at maintaining and growing their wealth.”
Still, the final version of the bill makes no such provision.
Furthermore, three years after the bill is signed, no foreign stablecoin issuers that aren’t approved in the US will be able to offer a stablecoin in the country. There are some carveouts, for example, if the US Treasury deems that the stablecoin issuer’s country of origin has a comparable regulatory regime to the United States.
Will the Senate give the crypto industry CLARITY?
The CLARITY Act and Emmer’s Anti-CBDC Surveillance State Act are now headed to the Senate.
The CLARITY Act would offer “digital commodities on mature blockchains” an exemption from the Securities Act of 1933 and reassign regulatory purview over crypto from the Securities and Exchange Commission (SEC) to the Commodity Futures Trading Commission (CFTC).
The act enjoyed a significant amount of bipartisan support in the House of Representatives despite an “anti-crypto corruption week campaign” among some House Democrats.
Many crypto critics in Congress believe that the bills have not been sufficiently amended to address concerns over corruption and ethics violations, particularly as it concerns the personal crypto business of President Donald Trump.
Still, the CLARITY Act had relatively bipartisan support in the House, with 78 Democrats voting in favor of the measure.
Senate Democrats who also supported the GENIUS Act may be willing to vote with their Republican opponents again on the CLARITY Act despite vocal criticism of the bills from crypto-skeptic Democrats in the Senate, such as Senator Elizabeth Warren.
Related: US CLARITY bill could allow Tesla and Meta to evade SEC rules — Senator Warren
The vote on the Anti-CBDC bill was closer, reflecting a more partisan divide on whether the Fed should be prevented from issuing a digital dollar. The bill’s sponsor repeated usual criticisms of CBDC in a Thursday announcement, calling it “insidious technology, which would undermine our values and destroy Americans’ right to privacy.”
Still, if only a couple of Senate Democrats vote for the bill, which isn’t impossible given that a recent Cato Institute poll found that 22% of Democrats oppose a CBDC, the bill could have a chance at passing.
Crypto industry optimistic
Even with amendments and caveats, the three bills would represent a windfall for the crypto industry in the US and the beginning of the full integration of crypto in the country’s financial system.
Crypto leaders are optimistic. Nathan McCauley, CEO and co-founder of Anchorage Digital, said of the CLARITY Act, “Knowing which assets are securities, which are commodities, and why that distinction matters is foundational for market transparency and integrating crypto into traditional finance.”
James Harris, group CEO at crypto lending firm Tesseract, said that pro-crypto laws in the US have the chance to influence laws abroad: “Policy often fans out from the US to across the globe.”
“The US is looking to reclaim digital asset leadership, and the US will still be the largest market if they are successful. Delays will just cede advantage to the UAE and Hong Kong,” he said.
With more politicians swinging pro-crypto, whether these bills will pass seems rather a question of “when” than “if.”
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