Banking and Finance Law Daily Wrap Up, FINANCIAL TECHNOLOGY—GENIUS Act stablecoin bill passes key procedural hurdle, (Jun 12, 2025)

By Steven Melendez

The Senate voted to advance the bill, which advocates say will modernize the financial system but critics say could lead to corruption and destabilization.

The Senate voted 68 to 30 to invoke cloture on the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, which would regulate payment stablecoins—cryptocurrency tokens linked in value to the U.S. dollar and designed for monetary transactions.

"The benefits of stablecoin innovation are immense," said Sen. Bill Hagerty (R-Tenn.), who introduced the bill. "By reducing friction in the payment process, they can improve the speed and efficiency of cross-border payments. Faster and cheaper transactions can unlock much-needed working capital for American businesses and provide individuals with more effective tools for making international payments."

The bill is also sponsored by Sens. Tim Scott (R-S.C.), Kirsten Gillibrand (D-N.Y.), Cynthia Lummis (R-Wyo.), and Angela Alsobrooks (D-Md.). Advocates say the bill would help modernize the financial industry, help create demand for the U.S. dollar, protect consumers and businesses using stablecoins, and hold the organizations that issue the coins to similar standards as other financial institutions.

“It would ensure Americans can trust who they’re doing business with when they purchase stablecoins—allowing the American people to exercise financial freedom with confidence," said Senate Majority Leader John Thune (R-S.D.). “The GENIUS Act would also protect against threats to our national security and from criminal activity. It would require stablecoin issuers to uphold the same standards as other financial institutions to monitor and report suspicious activity, comply with U.S. sanctions, and block illicit transactions."

The bill was advanced by the Senate Banking Committee in March, with support from all of the committee's Republican members and five Democrats.

"It’s the product of months of bipartisan work—and I also want to thank the bill’s sponsor, Bill Hagerty, who went out of his way to make this legislation a bipartisan success—by partnering with Senator Alsobrooks, working with Gillibrand, along with our colleagues on this side of the aisle—Senator Lummis and myself. I am incredibly proud to see the hard work of Senator Hagerty pay off—not for him—but for the American people," said Sen. Scott, who is the chairman of the Senate Banking Committee. "That’s what makes this process such a special one."

Critics, however, including some Senate Democrats, argue that the bill could open up avenues for corruption and cause harm to the overall financial system.

Sen. Elizabeth Warren (D-Mass.) critiqued Thune for not allowing a vote on amendments she said would help fix issues with the bill. As it stands, she said, the proposed law would create a regulatory system "riddled with loopholes" and offering only "weak safeguards for consumers, national security, and financial stability."

Warren compared the bill to the Commodity Futures Modernization Act signed by President Bill Clinton in 2000, which she argued led to the 2008 financial crisis by promoting and deregulating financial derivatives. The bill could also drain funds from community banks as consumers choose to use stablecoins instead, Warren said.

And, Warren argued, it would also open the door to corruption, including via President Donald Trump's ties to the crypto industry.

"Through his crypto businesses, President Trump has created an efficient means to trade presidential favors like tariff exemptions, pardons, and government appointments for hundreds of millions—perhaps billions—of dollars from foreign governments, from billionaires, and from large corporations," Warren said. "This is the single greatest corruption scandal in American history and, by passing the GENIUS Act, the Senate is about to not only bless this corruption, but to actively facilitate its expansion."

Sen. Lisa Blunt Rochester (D-Del.) similarly criticized the process around the bill for not allowing amendments she said would improve the text.

“As I mentioned in my statement last month, there are several areas of the bill that I felt needed significant improvement with the goals of rooting out corruption, protecting consumers, and protecting our financial stability," she said. "I felt as though these improvements could have been achieved through an open amendment process, but unfortunately, one was not offered. For that reason and those laid out in my previous statements, I could not support this bill.”

Americans for Financial Reform also decried the bill as a giveaway to the crypto industry and big tech companies that could be able to create their own stablecoins with what the group says is too little regulation.

“This windfall for the crypto industry will pave the way for Big Tech to create their own corporate currencies with little oversight but big risks for consumers and the economy,” said Mark Hays, associate director for cryptocurrency and financial technology with Americans for Financial Reform and Demand Progress. “Thanks to this legislation, the next crypto collapse will no longer happen in a vacuum; instead the entire financial system will be subject to the instability of an industry rife with scandal, exploitation and illicit finance.”

Companies: Americans Financial Reform; Demand Progress

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