CRS Reviews Bipartisan Legislation on Payment Stablecoin Regulation

The Congressional Research Service reviewed the regulatory framework and licensing process for the "Guiding and Establishing National Innovation for U.S. Stablecoins Act of 2025" ("GENIUS Act"). The bill was introduced on February 4th, 2025, and co-sponsored by lawmakers from both parties. 

The legislation would, among other things: (i) establish a framework for issuing and redeeming payment stablecoins; (ii) require stablecoin issuers to maintain reserves on a 1:1 basis, composed of assets such as US currency, Treasury bills and demand deposits; (iii) prohibit non-approved entities from issuing stablecoins; (iv) assign regulatory oversight to federal and state financial regulators, with the Federal Reserve, the OCC and the FDIC serving as primary regulators; and (v) establish penalties for unauthorized issuance, with fines of up to $100,000 per day for violations. 

In a joint press release, the following co-sponsors remarked:

• Senate Banking Committee Chair Tim Scott (R): "This bipartisan agreement... will protect consumers and expand financial inclusion... Stablecoins enable faster, cheaper, and competitive transactions and facilitate seamless cross-border payments."
• Senator Bill Hagerty (R): "My legislation establishes a safe and pro-growth regulatory framework that will unleash innovation and advance the President’s mission to make America the world capital of crypto."
• Senator Kirsten Gillibrand (D): "The updated version of the GENIUS ACT makes significant improvements to a number of important provisions, including consumer protections, authorized stablecoin issuers, risk mitigation, state pathways, insolvency, transparency, and more."
• Senator Cynthia Lummis (R): "Creating a bipartisan regulatory framework for stablecoins is fundamental to preserving U.S. dollar dominance and advancing responsible financial innovation."
• Senator Angela Alsobrooks (D): "The bipartisan GENIUS ACT is our first step for determining how we as a country will regulate stablecoins, an important piece of the broader crypto space."