Senate Banking Committee to Review GENIUS Stablecoin Bill
Key Takeaways
- The GENIUS stablecoin bill aims to establish a regulatory framework for stablecoins in the United States.
- The bill proposes federal oversight for stablecoin issuers with market capitalization exceeding $10 billion.
The Senate Banking Committee is gearing up to assess Senator Hagerty’s proposed stablecoin legislation, known as the GENIUS Act, during the week of March 10, as confirmed by sources familiar with the matter.
The bill, introduced by Senator Hagerty on February 4, 2025, outlines guidelines for stablecoin issuance, limiting it to authorized entities such as subsidiaries of insured depository institutions, federal-qualified nonbank payment stablecoin issuers, and state-qualified payment stablecoin issuers.
Within this proposed framework, stablecoin issuers with a market capitalization exceeding $10 billion will be subject to federal oversight, while those below this threshold can opt for state regulation provided that states adhere to federal criteria.
Furthermore, the GENIUS Act mandates that stablecoins maintain a full 1:1 backing with US dollars or other approved high-quality liquid assets, such as short-term Treasury bills and repurchase agreements.
Additionally, the bill prohibits the use of algorithmic stablecoins and requires issuers to publicly disclose redemption policies and undergo regular reserve audits.
This legislative initiative aligns with global trends, exemplified by the European Union’s Markets in Crypto-Assets law (MICA) and recent authorizations of Circle’s USDC and EURC stablecoins by the Dubai Financial Services Authority.