GENIUS Act One Year Later: US Stablecoin Regulation Changes the Game

GENIUS Act: One Year Later, U.S. Stablecoin Regulation Changes the Game

On July 19, 2025, President Donald Trump signed the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, the first federal U.S. law dedicated to cryptocurrencies. One year later, where do we stand? Between regulatory advances, political controversies, and battles over ethics, the stablecoin landscape has evolved profoundly.

What is the GENIUS Act?

The GENIUS Act is a law that frames the issuance and management of stablecoins — those cryptocurrencies backed by traditional assets (primarily the U.S. dollar) such as Tether’s USDT or Circle’s USDC. A stablecoin, by design, aims to maintain a stable value relative to its peg, typically the dollar, serving as a reliable medium of exchange and store of value within the crypto ecosystem. The law entrusts federal agencies, notably the Office of the Comptroller of the Currency (OCC) — which oversees national banks — and the Federal Deposit Insurance Corporation (FDIC) — which insures deposits — with defining precise rules regarding reserves, governance, and operational obligations for issuers.

This legislation represents a historic turning point: for the first time, the United States equipped itself with a federal legal framework for digital assets, even though the scope of the GENIUS Act remains limited to payment stablecoins — those used primarily for transactions rather than as investment vehicles.

One Year Later: Where Are the Regulators?

One year after the signing, the final rules are not yet in place, but the outlines are becoming clearer. Several agencies have published proposed rules subject to public consultation:

• The OCC proposed in February 2026 its interpretation of the law, detailing how stablecoins should be managed by financial institutions, including requirements for reserve composition and custody.
• The FDIC published 144 questions covering custody, capital and liquidity standards, and supervision of issuers, seeking input on how to apply traditional banking safeguards to stablecoin operations.
• An administration draft requires stablecoin issuers to perform KYC (Know Your Customer) verifications similar to those of traditional financial institutions, a move aimed at combating money laundering and ensuring counterparty transparency.

According to Ji Hun Kim, CEO of the Crypto Council for Innovation, as interviewed by CoinDesk: “One year later, agencies, institutions, and innovators are building on clearer foundations, and stablecoins are rapidly moving toward mainstream adoption.” This sentiment reflects a broadly positive outlook within the industry, though significant compliance hurdles remain. It will still be a few months before these rules are finalized. In the meantime, all eyes are on the next major legislative text: the Digital Asset Market Clarity Act.

The Clarity Act: The Next Battleground

While the GENIUS Act covers only stablecoins, the Clarity Act aims to establish a comprehensive framework for all digital assets, from altcoins to DeFi tokens. However, its progress is strewn with obstacles.

The text of the Clarity Act, whose publication was expected last week, is still not public. Senators Cynthia Lummis and Bernie Moreno were scheduled to meet with Trump on Thursday, July 16 to discuss the draft, but no official account has been published. The main sticking point remains the absence of an ethics clause preventing high-ranking government officials from profiting from their own crypto projects. According to sources close to the matter cited by CoinDesk, no bipartisan agreement has been reached on this issue, underscoring the deep political divisions surrounding digital asset regulation.

Without such a clause, critics argue that policymakers could craft rules that personally benefit their crypto holdings, eroding public trust. This ethical dimension has become a central flashpoint in the broader debate over U.S. crypto legislation.

The Ethical Controversy: Elizabeth Warren vs. Trump

Senator Elizabeth Warren sent a public letter to Trump on Thursday, July 16, asking for an updated financial disclosure covering the first half of 2026. Trump’s 2025 disclosure revealed that he had generated more than $1.4 billion through various crypto enterprises, highlighting the scale of his personal involvement in the industry.

Warren emphasizes that the 2025 disclosure “is not an up-to-date reflection of your finances: it does not account for changes that have occurred in recent months.” Trump is not required to provide an update until May 15, 2027, leaving a lengthy gap during which his crypto dealings may have evolved significantly. Warren argues that a voluntary disclosure “would provide Congress with the information needed to effectively address government ethics concerns.”

On the other side, the House Subcommittee on Digital Assets held a hearing on Friday to defend the Clarity Act. Representative Bryan Steil, who chairs the subcommittee, stated: “Our goal is clear: replace regulation by enforcement with clear rules of the road for digital assets.” This statement reflects a push for proactive legislation rather than relying on existing securities laws applied retroactively, a approach the industry has long criticized as unpredictable and stifling.

Impact on the Stablecoin Market

The impact of the GENIUS Act on the stablecoin market is considerable. With a total capitalization exceeding $200 billion, stablecoins have become an essential link in the crypto infrastructure, serving as a bridge between traditional and decentralized finance. They facilitate trading, lending, and cross-border payments, and their stability makes them attractive for businesses and consumers alike.

Tether’s USDT, the market leader, faces a 2-year countdown to comply with the new U.S. rules or risk losing access to U.S. crypto platforms. This compliance timeline puts pressure on Tether to increase transparency around its reserves and governance. Circle’s USDC, already compliant with many standards, is well positioned to benefit from this regulation, potentially gaining market share as the “regulation-friendly” alternative.

At the same time, the expansion of stablecoins is accelerating internationally — in Brazil, a country targeted by Trump, dollar stablecoins are invading the payment system, offering an alternative to local currency volatility. The United States and the United Kingdom are also working to establish common rules for stablecoins, opening a clearer cross-border path for issuers and potentially setting a global precedent for harmonized stablecoin regulation.

What to Remember for the Year Ahead?

Several key developments are expected in the coming months:

• Finalization of OCC/FDIC rules: Agencies must publish their final rules in the coming months, providing unprecedented regulatory clarity for stablecoin issuers and the financial institutions that interact with them.
• Adoption of the Clarity Act: If the ethics clause issue is resolved, the text could be adopted before the end of the year, profoundly transforming the U.S. regulatory landscape for all digital assets, not just stablecoins.
• Evolution of the stablecoin market: Regulatory compliance will reshape the competition between USDT and USDC, with the potential emergence of new bank-issued stablecoins as traditional financial institutions enter the space under clearer rules.
• International cooperation: U.S.-UK discussions on common rules could create a precedent for globally harmonized stablecoin regulation, encouraging other jurisdictions to align their frameworks.

Conclusion

One year after the signing of the GENIUS Act, the United States has entered a new era of crypto regulation. The road is still long — detailed rules have not been finalized, the Clarity Act is stalled by political quarrels — but the direction is set. Stablecoins, once a regulatory gray area, are now officially recognized as a component of the U.S. financial system.

For cryptocurrency investors and users, this evolution is broadly positive: more clarity means less legal risk and accelerated institutional adoption. But the battle over ethics shows that crypto regulation remains deeply political, and its future will depend as much on parliamentary balances as on technological advances. The coming months will determine whether the promise of clear rules translates into a stable, inclusive digital asset ecosystem — or becomes mired in the same partisan divisions that define so much of modern policymaking.

Sources: CoinDesk, The Block, Cryptopolitan, Coinfomania

⚠️ Opinion and analysis — not investment advice
This article is provided for informational and analytical purposes only. It does not constitute investment advice, a solicitation, or a recommendation to buy/sell digital assets. Cryptocurrencies carry high risks — only invest what you can afford to lose. Always do your own research (DYOR) before making any financial decisions.
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