CoinPaprika
Feb 5, 2025

Senator Hagerty Introduces GENIUS Act to Regulate Payment Stablecoins

2 min

US Senator Bill Hagerty has introduced the GENIUS Act, aiming to regulate payment stablecoins and enhance the US dollar's dominance. This bill represents a significant step towards establishing a legal framework for stablecoin transactions.

  • The GENIUS Act defines payment stablecoins as digital assets pegged to a fixed value, required to be backed by US currency, insured demand deposits, Treasury bills, and approved assets.
  • Issuers with a market cap over $10 billion will be regulated by the Federal Reserve; non-bank issuers will fall under the Office of the Comptroller of the Currency, while smaller issuers will be state-regulated but may seek exemptions.
  • Only Tether (USDT) and USD Coin (USDC) currently exceed the $10 billion threshold.
  • The bill mandates monthly audits of stablecoin reserves, with penalties for false reporting, and outlines licensing procedures and compliance mechanisms.
  • Senator Hagerty stated stablecoins could enhance payment efficiency and boost demand for US Treasuries, aiming to create an innovative regulatory environment.
  • The bill is co-sponsored by Senators Kirsten Gillibrand, Tim Scott, and Cynthia Lummis, who emphasized the importance of bipartisan regulation for the future of digital assets.
  • Reports suggest that the bill may progress quickly through congressional committees, following support expressed by White House advisor David Sacks.