The Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act was signed into law on July 18, 2025, following Senate passage on June 18. The law creates the first comprehensive federal regulatory framework for payment stablecoins in the United States.
Key Requirements
The GENIUS Act requires stablecoin issuers to maintain 1:1 reserves in liquid assets (USD cash or short-term US Treasuries), publish monthly public reserve disclosures, and establish insolvency protections that prioritise stablecoin holders. Stablecoins are explicitly classified as neither securities nor commodities, resolving a jurisdictional dispute between the SEC and CFTC.
Immediate Market Impact
Stablecoin payment usage jumped 70% within three months of passage, according to Bloomberg data. Tether launched USA-T, a dedicated US-regulated stablecoin issued through OCC-regulated Anchorage Digital Bank. The Federal Reserve confirmed that regulated stablecoins can operate within the existing banking framework, with a November 2025 speech outlining supervisory expectations.
What This Means
The GENIUS Act transforms stablecoins from a regulatory grey area to a supervised payment rail. Combined with EU MiCA (effective 2024-2025) and Hong Kong's Stablecoins Ordinance (August 2025), it creates a coordinated global regulatory framework across the three largest financial centres. For payment infrastructure, this means stablecoins are now a legitimate settlement option alongside traditional bank money and central bank reserves.
Sources: Bloomberg, The Paypers