The Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, signed into law on July 18, 2025, indeed establishes a comprehensive federal regulatory framework for payment stablecoins in the United States. The legislation aims to provide regulatory clarity, protect consumers, and mitigate financial risks associated with these digital assets.
Key Provisions
Permitted Issuers: Only "permitted payment stablecoin issuers" (PPSIs) can issue stablecoins in the U.S.. These include subsidiaries of insured depository institutions, federally licensed non-bank entities, and state-licensed issuers (under certain conditions).
Reserve Requirements: Issuers must maintain 1:1 reserves for all outstanding stablecoins, backed by high-quality, liquid assets such as U.S. dollars or short-term Treasuries.
Transparency and Audits: PPSIs are required to publish monthly public disclosures of their reserve compositions and undergo annual independent audits.
Consumer Protection: Stablecoin holders are granted priority claims over other creditors in the event of an issuer's insolvency, and the act mandates clear and conspicuous redemption procedures.
Regulatory Oversight: The Act clarifies that compliant payment stablecoins are generally not considered securities under federal securities laws, placing primary regulatory oversight with banking authorities like the Federal Reserve, the FDIC, and the OCC.
Prohibition on Interest: Issuers are explicitly prohibited from paying any form of interest or yield to stablecoin holders.
The act is a significant step in U.S. cryptocurrency regulation, with various federal agencies currently in the process of developing and finalizing implementing regulations.#USGDPUpdate #USCryptoStakingTaxReview #USJobsData #USBitcoinReserveDiscussion $BNB
