In a groundbreaking development, the U.S. House of Representatives recently voted to pass the country’s first significant legislation regarding cryptocurrencies, signaling a notable shift in the government’s approach to digital currencies.
This new legislation, dubbed the Genius Act, was signed into law by President Donald Trump in a ceremony celebrated by Republican lawmakers, highlighting the administration’s ambition to make America the ‘crypto capital of the planet.’
With the enactment of this law, the overall market valuation of cryptocurrencies surged to a record $4 trillion, reflecting the excitement within the sector.
The Genius Act focuses specifically on stablecoins, a narrower yet promising segment of the crypto market, and sets the groundwork for additional regulatory measures in the future.
Two other crypto-related bills are currently progressing through Congress, one of which, the CLARITY Act, was also passed amidst what Republican lawmakers are calling ‘crypto week.’
This particular bill aims to transfer regulatory authority over the cryptocurrency sector from the Securities and Exchange Commission (SEC) to the Commodity Futures Trading Commission (CFTC), generating significant debate among lawmakers and stakeholders.
While crypto advocates view this shift as a chance for financial innovation, critics assert that such a move would dilute oversight and regulation over an industry they label as risky.
As crypto supporters celebrated their recent victories, they argue that digital currencies represent the future of finance, emphasizing that stablecoins, in particular, provide a safer alternative due to their backing by traditional currencies like the dollar and euro.
Stablecoin companies foresee a vast potential for their products, suggesting that these digital currencies will enable instant, cost-effective cross-border transactions without the burdens traditionally associated with banks or money transfer services.
Kevin Lehtiniitty, CEO of Borderless.xyz, asserts that over the next decade or two, stablecoins could become the standard for commerce.
However, opposition voices contend that the newly passed Genius Act offers minimal protection, claiming that the legislation has been heavily influenced by lobbying efforts and substantial campaign donations from the crypto sector.
Consumer advocacy group Better Markets expressed concern over the potential consequences of lax regulations, suggesting that they could ultimately harm consumers and the economy.
Amanda Fischer, policy director for Better Markets, criticized the bill’s effectiveness, stating, ‘It’s all hype and there’s not much ‘there there.’
While the Genius Act does enforce certain provisions mandating stablecoin companies maintain proper reserves and uphold transparency, critics believe these measures fall short of ensuring adequate consumer protection.
Conversely, advocates maintain that the law sets clear standards comparable to those required of traditional banks, arguing that it represents a significant step toward enhancing financial regulation in the United States.
Dante Disparte, chief strategy officer for Circle, one of the leading stablecoin issuers, emphasized that the broad bipartisan support for the bill reflects its robustness in addressing consumer protection.
Though critics remain opposed, the crypto industry feels bolstered by its recent legislative wins and the backing of President Trump, who has familial financial interests in the crypto market.
The focus now shifts to the CLARITY Act, which seeks to reduce the regulatory power of the SEC, particularly following the Biden administration’s rigorous pursuit of compliance from crypto firms.
The SEC’s previous leadership had sought to enforce traditional financial regulations on the emerging cryptocurrency sector, leading to heightened tensions between regulators and industry players.
Crypto companies have long argued that their products necessitate distinct regulations tailored to the unique qualities of digital currencies.
Mark Hays from Americans for Financial Reform warns against the potential consequences of reduced oversight, suggesting that it could expose consumers to risks associated with unregulated financial products.
Despite the opposition, the crypto industry marches on, buoyed by a recent legislative victory in the wake of the GENIUS Act’s passage.
As the debate around digital currency regulation continues, the implications of these new laws will likely shape the future of the booming cryptocurrency market.
image source from：npr
