A bill has been passed in the parliament called as the Genius Act for regulating the crypto stablecoin in the US. On Monday, the bill was passed and got a majority of 66-34 in the parliament voting. If the bill gains a majority again in the voting happening again in this week, the main hurdle in the US will be descaled.
What is the Genius Act?
Genius Act permits the regulation of the issue of dollar-pegged stablecoin. It is a kind of cryptocurrency that can be adopted by the country’s best Fintech companies. Crypto legislation would bring a major change in the future of the US economy. The value of the dollar will be maintained continuously, and it will help the country gain power in the world. This legislation would contribute largely to building the financial infrastructure of the country. This act would allow banks and companies to issue stablecoins under certain conditions, only to regulate their actions. This bill is being passed to bring transparency to the digital system operated by the government.
Concerns related to the Genius Act
On May 8, the first voting in the parliament failed as the bill could not attain the 60 votes threshold. This happened because this act opened new challenges and concerns related to consumer’s protection and national security in the parliament. Some changes were made in the bill, mainly in its language to address its benefits and negative impacts clearly in the parliament. After that, the bill looked smooth to pass on Monday, 19 May 2025. The bill addressed the concerns and consumer protection provisions more precisely now.
Changes in the Genius Act Bill
To pass the bill in the parliament, some major security changes were necessary. One of them was to regulate the consumers who are issuing crypto through Anti-money Laundering. This way, the government can look for possible scams and fraud in the system. The other change was to limit tech companies such as Meta from issuing their cryptocurrency, as it can affect the economy and the power of the government directly. A ban on the yield-bearing stablecoins would be imposed so that the crypto can be accessed by the government, and in case of bankruptcy, the consumers must be given their claims on a priority basis.
Negotiations on the changes
The changes and the legislation are no doubt a powerful tool to strengthen the US economy. But the senators are raising questions on some of the changes. The Bill restricts tech companies from issuing their cryptocurrency but does not restrict the President of the US from issuing his crypto. It is said that Trump and his family have a cryptocurrency named World Liberty Financial, which they own individually. According to the members, if the law is passed, it should apply equally to all.
Why does it matter?
Cryptocurrency like stablecoins are a part of web3 which helps in the economic growth of a country. The countries that are not using this technology are sidelined due to the absence of a well-defined stablecoin regulation. The US was one of them where the stablecoin regulations were not defined. For introduction of the stablecoin regulation, the public is provided with the information for clarity.
Conclusion
There are pros and cons to every bill and every action taken on some or other community. The Genius Act, too, has its limitations. People believe that it will become a new platform for corruption, as the people will not be able to identify the intake of a corrupt account. They believe that it will pose a threat to national security, financial security, and consumer protection. Moreover, Trump and his administration have aimed at two crucial things in crypto: passing crypto legislation and then regulating the capital market structure of stablecoins.
