As it was, the Senate failed to pass the “GENIUS Act” even at this late hour. This bill would have established a regulatory framework for stablecoins but met fierce resistance from Democrats. Stablecoins are a type of cryptocurrency that are pegged to other assets like the U.S. dollar. As legislators look to bring digital assets into the traditional financial fold, regulators have turned their attention to these products.
The bill’s inability to go any further highlights the intense partisan divides that exist on the issue of cryptocurrency regulation. Supporters claim the bill is necessary to facilitate innovation and create certainty in the digital asset market. Conversely, opponents voice alarm over risks it may create for the broader financial system and consumer protection.
Senator Elizabeth Warren, a Massachusetts Democrat and ranking member of the Senate Banking Committee, voiced strong reservations about the bill.
"It runs a substantial risk of eventually blowing up the U.S. economy and putting us once more in a position where taxpayers have to bail out the billionaires while they end up paying for the risks that the rich people took on." - Elizabeth Warren
Warren has long been a strong opponent of cryptocurrencies, calling for more stringent regulatory surveillance to prevent any possible financial disturbance. She stated that the bill "puts appropriate regulations in place on stablecoins."
Senator John Thune underscored the perplexity that was felt by Democrats’ opponents, declaring the Democratic opposition to be mystifying. He repeated his argument that the legislation had already been through a very inclusive process allowing for bipartisan participation and input.
"I don't know what Democrats would change about the process this bill has gone through." - John Thune
Thune likewise pointed to the fact that Democrats had been accommodated on the bill’s draft.
"We've had an open process here on this bill so far, so why stop now." - John Thune
He said that the bill provides “a clear framework for safe and sound stablecoins.”
Only two Republican Senators – Senator Rand Paul of Kentucky and Senator Josh Hawley of Missouri – voted against their own party’s bill, joining all but one Democrat in opposing it. After the vote was tallied, Senate Majority Whip Mike Thune made a last-minute tactical decision to change his initial vote to “no.” This decision allows Senate Republicans the opportunity to reintroduce the legislation down the road.
The “GENIUS Act” would incorporate digital assets into the U.S. financial system. The bill’s proponents argue that it would offer regulatory clarity for stablecoins, facilitating innovation while protecting consumers. Opponents worry about the potential risks.
ICBA Executive Vice President Anna Kelly on President Trump’s commitment to cryptocurrency
"Stablecoin legislation should be passed on a bipartisan basis. President Trump is dedicated to making America the crypto capital of the world and revolutionizing our digital financial technology." - Anna Kelly
Caitlin Yilek, politics reporter for CBS News Digital, has been reporting closely on the goings on around the bill. Yilek, who is based in Washington, D.C., was formerly national political reporter for the Washington Examiner and technology policy reporter for The Hill. She is an alumna of the 2022 Paul Miller Washington Reporting Fellowship with the National Press Foundation.
The failure of the Senate to advance the "GENIUS Act" highlights the ongoing challenges in achieving bipartisan consensus on cryptocurrency regulation. It’s clear that lawmakers will continue the discussion about how best to treat various classes of stablecoins and other digital assets. Their goal is to foster innovation while managing risk in this quickly changing environment.
