GILLIBRAND, BIPARTISAN GROUP OF SENATORS INTRODUCE LEGISLATION TO ESTABLISH STABLECOIN REGULATORY FRAMEWORK

Today, U.S. Senator Kirsten Gillibrand, together with Senators Bill Hagerty (R-TN), Tim Scott (R-SC), and Cynthia Lummis (R-WY), introduced the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, legislation to establish a clear regulatory framework for payment stablecoins.

“The bipartisan Guiding and Establishing National Innovation for U.S. Stablecoins Act protects consumers by requiring stablecoin issuers to maintain one-to-one reserves, prohibiting algorithmic stablecoins, and requiring issuers to comply with U.S. anti-money-laundering and sanctions rules,” said Senator Gillibrand. “Importantly, it will empower responsible innovation, maintain U.S. leadership in digital assets and blockchain technology, and keep crypto companies and jobs onshore. The future of stablecoins and cryptocurrency has strong bipartisan support. I’m proud to introduce this bill with Senators Hagerty, Lummis and Scott, and I look forward to working together to pass this important legislation.”

Dollar-denominated payment stablecoins are digital assets pegged to the U.S. dollar. They can improve transaction efficiency, expand financial inclusion, and strengthen the dollar’s supremacy as the world reserve currency by driving demand for U.S. Treasuries.

 The GENIUS Act:

1. Defines a payment stablecoin as a digital asset used for payment or settlement that is pegged to a fixed monetary value;
2. Establishes clear procedures for institutions seeking licenses to issue stablecoins;
3. Implements reserve requirements and light-touch, tailored regulatory standards for stablecoin issuers;
4. For issuers of more than $10 billion of stablecoins, applies the Federal Reserve’s regulatory framework to depository institutions and the Office of the Comptroller of the Currency’s framework for nonbank issuers;
5. Allows for state regulation of issuers under $10 billion in market capitalization and provides a waiver process for issuers exceeding the threshold to remain state-regulated; and
6. Establishes supervisory, examination, and enforcement regimes with clear limitations.

Full text of the GENIUS Act can be found here.