Washington: President Donald Trump on Friday July 18, 2025 signed the GENIUS Act into law officially establishing the first federal regulatory framework for stablecoins in the United States. The bill which passed the Senate in late June and cleared the House on July 17th, is now set to reshape how digital dollar backed tokens are issued, audited and supervised across the country.
Key Takeaways
- President Trump signed the GENIUS Act into law, creating the first federal rules for stablecoin issuance and oversight in the United States.
- The law requires stablecoins to be backed one to one with U.S. dollars or Treasuries with monthly reserve disclosures and federal registration.
- Crypto firms welcomed the law as a major milestone while companies like Amazon and Walmart are exploring token based payment systems.
- Critics warned the law could favor large players and leave gaps in enforcement as regulators now prepare to roll out licensing rules.
The legislation, formally titled the Guiding and Establishing National Innovation for U.S. Stablecoins Act or GENIUS Act, requires that all stablecoins be backed one to one with either U.S. dollars or other low risk assets such as short term Treasuries. It also mandates monthly public disclosures of reserves, independent audits and strict compliance with anti money laundering (AML), Bank Secrecy Act (BSA) and know your customer (KYC) regulations.
Stablecoin issuers will be required to register under a new federal licensing framework coordinated by the U S Treasury Department, Office of the Comptroller of the Currency (OCC) and state qualified authorities.
At a signing event held at the White House, Trump called the law “a hell of an act” and said it would put the United States at the forefront of financial innovation. “They named it after me” he joked, referring to the acronym. Treasury Secretary Scott Bessent who stood alongside Trump during the signing said the law would “protect the dollar, strengthen financial transparency and help more Americans access digital tools securely.”
The signing ceremony drew a high profile crowd from the cryptocurrency and fintech world, including executives from Coinbase, Circle, Robinhood, Kraken, Tether and Gemini. Several major banks, credit unions and venture backed startups were also represented.
Many in the industry see the law as a long awaited turning point for regulatory clarity that could make stablecoins more viable for use by payment processors, large retailers and even banks.
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Industry sees big opportunity, but regulators will shape the outcome
Executives from major crypto firms have called the new law a turning point for the sector. Circle’s CEO Jeremy Allaire said in a post on X that this was the clearest signal yet that the United States is ready to compete in digital finance. Others at the event said it would finally allow large companies to enter the stablecoin space without uncertainty about federal compliance.
As reported by MarketWatch, several companies including PayPal and Stripe have already begun exploring plans to launch their own stable digital tokens under the GENIUS framework. For instance, JPMorgan Chase announced plans to launch its own stablecoin called JPMD for institutional clients.
Retail giants may also follow. As noted by Business Insider, both Amazon and Walmart are reviewing internal proposals for token based payment systems tied to the U.S. dollar. While no announcements have been made, executives familiar with the talks said the GENIUS law gives them the policy clarity they were waiting for.
The law is expected to give the Treasury Department and OCC broad powers to issue licenses, enforce disclosures and approve or block new stablecoin issuers. The White House said the new Act takes effect after 18 months of the enactment of the Act or after 120 days of the date on which the primary Federal payment stablecoin regulators issue any final regulations implementing the Act, whichever comes first.
Critics warn of loopholes and lack of clarity in enforcement
Not everyone in the financial space agrees with how the law is structured. Some smaller fintech firms and policy analysts have raised concerns that the law may favor established players who already meet capital and reporting requirements. As reported by Investopedia, critics said the bill leaves room for interpretation in areas like reserve asset standards and federal versus state oversight.
A few legal experts also pointed out that while the law requires transparency, it does not define enforcement penalties for non compliance in full detail. This could create gaps unless regulators follow through with tight supervision. Consumer advocacy groups said they would continue to push for added rules on user protections, disclosures and emergency fund access for users who hold stablecoins issued by private firms.
Democratic critics, including Sen. Elizabeth Warren and Rep. Maxine Waters, expressed concerns that the law fails to address conflicts of interest particularly when the Trump family’s ownership of World Liberty Financial, which issues the USD1 stablecoin.
Attention now turns to upcoming crypto bills
With the GENIUS Act now signed, focus is shifting to other major digital asset bills awaiting Senate action. The CLARITY Act which aims to set boundaries between crypto tokens and securities, has already passed the House and may be considered before the August recess. Another proposal the Anti CBDC Surveillance State Act, has support from a growing number of Republican senators but faces opposition from democrats some regulators.
For now, the GENIUS Act gives the stablecoin industry a legal foundation that did not exist until now. While questions remain about implementation, most agree that the signing of the law represents a landmark moment in how the U.S. government approaches digital currency policy.
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