Senate Narrowly Rejects GENIUS Act, Halting Stablecoin Legislation – Coincu

The U.S. Senate voted 48-49 against advancing the GENIUS Act, a bill intended to create the first stablecoin regulatory framework in the country. The rejection reflects heightened political tensions surrounding cryptocurrency regulation, leading to ongoing uncertainty for both domestic issuers and market participants.

The U.S. Senate’s 48-49 vote against the GENIUS Act underscores complex political dynamics. The stablecoin regulatory framework bill, sponsored by Sen. Bill Hagerty, faced opposition primarily from Senate Democrats. Concerns focused on alleged corruption risks linked to the Trump family’s cryptocurrency involvement and unmet demands for stronger prohibitions against government officials holding crypto assets. Republicans, despite holding a majority, failed to achieve the 60-vote procedural threshold required for passage.

Senate Vote Reflects Political Rift Over Crypto Regulation

The bill intended to establish a comprehensive regulatory system for stablecoins in the U.S., impacting major operators like USDC and USDT. The rejection perpetuates regulatory ambiguity, impacting traders and businesses relying on stablecoin transactions. Sen. Hagerty remarked that the decision could hinder the U.S. from maintaining a competitive edge in the global crypto market. Despite the setback, Republican leaders have indicated efforts to reintroduce the bill for another vote soon.

Public and industry reactions have varied, with several leaders emphasizing the need for a clear regulatory framework. Sen. Mark Warner commented on the need for further protections, highlighting bipartisan challenges.

Senator Bill Hagerty, Primary Sponsor of the GENIUS Act, remarked, “the vote effectively represented killing the crypto industry here in America.”

Stablecoin Market Faces Ongoing Uncertainty Amid U.S. Inaction

Did you know? In a similar case, the Stablecoin TRUST Act also faced legislative hurdles, highlighting the ongoing struggle to regulate stablecoins in the U.S. context.

Tether USDt (USDT) maintains stability with a current price of $1.00, commanding a market cap of $149.52 billion. CoinMarketCap reports a 24-hour trading volume of $111.46 billion, reflecting a significant 93.30% change. USDT experienced minor price movements, with a .01% decrease over 24 hours.

The Coincu research team suggests that persistent legislative gridlock on stablecoin regulation may deter national innovation. Analyses indicate that continuous U.S. inaction could shift crypto activities internationally. Historical precedents, market fluctuations, and political alignment are pivotal in predicting future regulatory outcomes.