In a critical move for the cryptocurrency industry, Sen. Bill Hagerty will introduce new laws aimed at establishing a regulatory framework for stubcoin.
The initiative coincides with President Donald Trump’s commitment to promoting a US crypto-friendly environment, indicating a marked shift in the political landscape surrounding digital assets.
Key takeout
Senator Bill Hagerty introduces the Genius Act to regulate stablecoins.
The Act aims to create a predictable regulatory environment for Stablecoin publishers.
Trump’s administration is changing towards a more cooperative attitude towards cryptocurrency.
Overview of Genius Law
The proposed law, known as the Guidelines and Establishment of National Innovation for the US Stablecoins (Genius Act), seeks to provide clear guidelines for the issuance and management of Stablecoins.
These digital currencies are designed to maintain stable value by being locked into traditional assets such as the US dollar.
The act of genius outlines some important provisions.
Regulatory Framework: Establish a comprehensive regulatory framework for stable payments.
Asset Support Requirements: Stablecoins mandate that they are supported by US currency, Federal Reserve notes, Treasury bills, or other stable assets.
Monthly Audit: Issuers must submit monthly audited reports to their booking reports, with penalties for false reports.
Regulation monitoring: Non-bank stubcoin issuers are regulated by the office of the Secretary of Currency.
Impact on the crypto market
The Stablecoin market has seen significant growth, reaching a valuation of $205 billion by the end of 2024.
This growth has been driven primarily by major players such as Tether Holdings Ltd. The introduction of the genius law is expected to increase the legitimacy of stable rocks, potentially leading to increased adoption and integration into traditional financial systems.
Change in Trump’s stance on cryptocurrency
President Trump’s approach to cryptocurrency has evolved considerably since his initial skepticism. His administration is currently focusing on driving growth in the crypto market by easing regulatory constraints.
This change is evident in his recent executive action. This highlights the development of legal, dollar-backed stubcoins and calls for the central bank to stop the advancement of digital currencies, which are considered stable competitors.
Trump’s commitment to the crypto industry is further emphasized by his collaboration with bipartisan lawmakers, including Senators Kirsten Gillibrand, Tim Scott and Cynthia Ramis, who co-host the act of genius.
This bipartisan support reflects the growing consensus on the need for clear regulations in the rapidly evolving crypto landscape.
Conclusion
As the act of genius moves forward, it represents a pivotal moment for the US cryptocurrency industry. With a regulatory framework in place, Stablecoins were able to gain wider acceptance and drive sector innovation and growth.
The collaboration between lawmakers and the Trump administration marks a new era of digital assets.