tl;dr
Senator Bill Hagerty and co-sponsors Senators Tim Scott, Cynthia Lummis, and Kirsten Gillibrand have introduced an updated version of the GENIUS Act stablecoin bill. The revised bipartisan legislation incorporates industry feedback and includes key modifications to enhance the regulatory framework f...
GENIUS ACT: LATEST UPDATES TO STABLECOIN REGULATION
Expansion of Reciprocity for Payment Stablecoins Issued in Overseas Jurisdictions
Definition of "Comptroller-regulated entity" and New Rules for Issuers
Reintroduction of GENIUS Act Amid Broader Push for Cryptocurrency Regulation in the US
Senator Bill Hagerty and co-sponsors Senators Tim Scott, Cynthia Lummis, and Kirsten Gillibrand have introduced an updated version of the GENIUS Act stablecoin bill. The revised bipartisan legislation incorporates industry feedback and includes key modifications to enhance the regulatory framework for stablecoins in the US.
The updated bill expands the regulation of stablecoins issued in overseas jurisdictions and sets specific requirements for overseas stablecoins. It also broadens the definition of "Comptroller-regulated entity" and includes new rules for issuers regarding blocking transactions and following legal orders.
The reintroduction of the GENIUS Act coincides with a broader push for cryptocurrency regulation in the US, with an executive session scheduled for March 13, 2025, to review the bill.
Senator Hagerty emphasized that strong stablecoin innovation has immense potential, ranging from improving transaction efficiency to increasing demand for US Treasuries.
The most notable update is the expansion “Reciprocity for Payment Stablecoins Issued in Overseas Jurisdictions.” The original bill addressed cross-border stablecoin issuance. However, the new version broadens this section to include specific requirements for overseas stablecoins. It requires the Secretary of the Treasury to establish reciprocal arrangements with countries with similar regulatory frameworks. These arrangements cover reserve requirements, supervision, anti-money laundering, sanctions compliance, and liquidity standards. These aim to improve international transactions and interoperability with US dollar-denominated stablecoins. The bill also sets a two-year deadline for completing these agreements.
The updated GENIUS Act expands the definition of a “Comptroller-regulated entity” to include both Federal qualified nonbank payment stablecoin issuers and any organization authorized by the Comptroller. Furthermore, the bill includes new rules for issuers about blocking transactions and following legal orders. The Secretary of the Treasury must work with them before blocking transactions involving the property of a foreign person. Nonetheless, the Secretary does not need to notify the issuer before taking action. The Act also requires issuers to have the technology needed to follow legal orders. These issuers must be able to freeze, seize, or stop the transfer of stablecoins if required by law. Issuers cannot offer or trade foreign stablecoins in the US unless they meet the Act’s legal requirements.
The GENIUS Act’s reintroduction comes amid a broader push for cryptocurrency regulation in the US. On March 13, 2025, at 10:00 a.m. ET, the Senate Committee on Banking, Housing, and Urban Affairs will hold an executive session to review the bill.
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