GENIUS Act of 2025

The bill would establish who may legally issue a payment stablecoin — a digital token redeemable for a fixed monetary value — in the United States. Only "permitted issuers" could do so: subsidiaries of federally insured depository institutions, nonbank entities licensed by the Office of the Comptroller of the Currency, or state-licensed issuers with no more than $10 billion in outstanding coins. All permitted issuers would have to maintain one-to-one reserves in U.S. currency, short-term Treasury securities, or other approved liquid assets; publicly disclose their reserve composition each month; submit monthly CEO/CFO certifications verified by an independent accounting firm; and comply with anti-money laundering and sanctions requirements as financial institutions under the Bank Secrecy Act. Issuers would also need the technical capability to freeze or burn tokens in response to lawful court or agency orders. State-regulated issuers that exceed the $10 billion threshold would have 360 days to transition to federal oversight or stop issuing new coins.

The bill would also amend securities, commodities, and bankruptcy law. It would clarify that payment stablecoins are not securities or commodities — removing SEC and CFTC jurisdiction — and give stablecoin holders first-priority claims over reserve assets in the event of an issuer's bankruptcy, ahead of all other creditors. Foreign issuers trading stablecoins in the U.S. would face the same lawful-order compliance requirement, and the Treasury Department would be directed to negotiate reciprocal regulatory agreements with comparable foreign jurisdictions within two years.

Existing and prospective stablecoin issuers — including banks, fintech companies, and technology firms — that would need to apply for federal or state licenses to operate legally. Consumers and businesses holding payment stablecoins would receive new bankruptcy protections. Banks and credit unions offering stablecoin custody services would benefit from clarified accounting and capital treatment rules. Foreign issuers currently trading stablecoins in U.S. markets would face new compliance demands.

If enacted, companies that cannot meet reserve, reporting, and compliance requirements would be barred from the U.S. stablecoin market, eliminating unregulated issuers. Stablecoin holders would gain legally enforceable priority over reserves if an issuer fails — a protection that did not exist when earlier stablecoin collapses caused consumer losses. The securities-exclusion amendments would end years of regulatory uncertainty about which federal regulator has jurisdiction.

Federal payment stablecoin regulators (OCC, Federal Reserve, FDIC, NCUA) would jointly promulgate rules within one year of enactment; the Act itself takes effect 18 months after enactment or 120 days after final rules, whichever comes first. Prospective issuers would submit applications to their primary federal regulator, which must act within 120 days or the application is deemed approved. Monthly reserve reports would be examined by registered public accounting firms, with CEO/CFO certifications submitted to regulators. The Financial Crimes Enforcement Network would issue tailored AML rules. Treasury would evaluate state regulatory regimes for "substantial similarity" to the federal standard and publish a certified list; state regulators of large issuers (above $10 billion) would share joint supervisory duties with the primary federal regulator.