Bipartisan Support Grows for the GENIUS Act, Boosting Chances of the Stablecoin Bill Passing

The Trump administration has been a strong advocate for crypto and a stablecoin bill. But now, bipartisan support for cryptocurrency is growing

The Trump administration was a vocal supporter of crypto and advocated for a stablecoin bill during his term. Now, the Biden administration is also showing interest in crypto regulation as bipartisan support for cryptocurrency is growing, which might increase the chances of the stablecoin bill passing.

According to a latest Bloomberg report, the Financial Services Committee will be reviewing the stablecoin bill on April 2. This development showcases the cryptocurrency industry’s expanding footprint in Washington, D.C., fueled by bipartisan support from figures like Senator Kirsten Gillibrand and substantial campaign contributions that have solidified industry allies.

The GENIUS Act, which aims to regulate stablecoins and introduce consumer protection measures, has secured support from both Republicans and Democrats. A key House Committee is set to vote in favor of the bill, indicating the increasing momentum behind it. The act will serve to regulate stablecoins and add more consumer protection policies.

Senators Bill Hagerty (R-TN) and Tim Scott (R-SC) took the initiative to introduce the bill, which has quickly garnered support from both Republicans and Democrats. On March 13, the Senate Banking Committee voted to advance the Genius Act, with five Democrats joining the Republican majority in backing it.

If the House approves the bill, stablecoin issuers can choose between federal or state charters, depending on their market size. Foreign issuers will also be required to follow U.S. rules on reserves, anti-money laundering, and sanctions compliance and liwuiduty.

“The reserve requirements and anti-money laundering requirements all fall neatly for RLSUD and USDC,” said Jeremy Hogan, partner at the law firm Hogan & Hogan.

The bill's supporters, including Chairman French Hill, highlight the urgency of regulating the stablecoin market to mitigate risks and ensure stability. They believe that regulating stablecoins would ultimately strengthen the dollar and enhance payment systems.

Crypto firms have actively lobbied for the bill, presenting it as an opportunity to boost financial inclusion and provide cheaper, faster transactions. However, critics like Top Democrat Maxine Waters and Senator Elizabeth Warren maintain that the bill does not go far enough in protecting consumers.

Moreover, they advocated for a ban on tech companies, particularly Elon Musk's X or Meta Platforms Inc.'s Facebook, to prevent them from issuing their own stablecoins.

Despite the support, the bill has faced criticism. Some critics are concerned about the lack of FDIC insurance for stablecoins, which could leave users vulnerable to significant losses if a token crashes.