GENIUS Act
Description
Establishes a regulatory framework for payment stablecoins, requiring issuers to maintain one-to-one reserves and meet federal standards.
Summary
What it does
This law establishes a regulatory framework for payment stablecoins by requiring issuers to be regulated entities, such as subsidiaries of insured banks or qualified state and federal nonbank issuers. Issuers must maintain reserves on a one-to-one basis using U.S. currency or liquid assets and are required to provide monthly public disclosures regarding those reserves. Additionally, the law clarifies that these stablecoins are not considered securities but subjects issuers to anti-money laundering requirements under the Bank Secrecy Act.
Who is affected
This bill affects entities seeking to issue payment stablecoins, including subsidiaries of insured depository institutions and both federal- and state-qualified nonbank issuers. It also impacts digital asset service providers and foreign stablecoin issuers who intend to offer or sell digital assets to U.S. persons. Additionally, the Department of the Treasury and various federal and state financial regulators are responsible for the supervision, examination, and enforcement of the new regulatory framework.
Key provisions
- Establishment of permitted stablecoin issuers. The bill restricts the issuance of payment stablecoins to specific entities, including subsidiaries of insured depository institutions and qualified federal or state nonbank issuers. Issuers may choose between federal or state regulation, though state oversight is limited to those with $10 billion or less in stablecoin issuance.
- Reserve and disclosure requirements. Issuers must maintain reserves backing stablecoins on a one-to-one basis using U.S. currency or other liquid assets. Additionally, issuers are required to publicly disclose their redemption policies and provide monthly reports regarding the details of their reserves.
- Regulatory status and compliance. The legislation clarifies that permitted payment stablecoins are not considered securities under federal law. However, issuers remain subject to the Bank Secrecy Act for anti-money laundering purposes and must comply with requirements for safekeeping services and reserve reuse.
- Framework for foreign stablecoin issuers. Foreign entities may offer stablecoins in the United States through digital asset service providers if the Department of the Treasury determines they are subject to comparable foreign regulations. These issuers must also meet specific requirements established by the bill.
Fiscal impact
- S. 1582, GENIUS Act· As passed by the Senate on June 17, 2025
Effective dates
Not applicable: Official Summary does not address effective dates
Relationship to existing law
The bill clarifies that permitted payment stablecoins are not considered securities under existing securities laws. Additionally, it stipulates that permitted issuers of these digital assets are subject to the anti-money laundering requirements of the Bank Secrecy Act.
Stated purpose
The bill aims to establish a comprehensive regulatory framework for payment stablecoins by defining permitted issuers, setting reserve requirements, and ensuring federal or state oversight. It seeks to provide clarity on the legal status of stablecoins as non-securities while implementing transparency, redemption, and anti-money laundering standards.