The US has passed the first major national cryptocurrency law aimed at establishing a clear regulatory framework for digital assets, marking a crucial moment for the cryptocurrency industry.
The law, called the Guiding and Establishing National Innovation for US Stablecoins (GENIUS Act), aims to provide clarity for issuers of stablecoins in the US and abroad, while ensuring consumer protection and combating money laundering.
The legislation focuses on stablecoins, a type of cryptocurrency considered stable because the digital asset’s value is pegged to a reference asset, which is either fiat money, exchange-traded commodities, or another cryptocurrency.
The new law requires these currencies to be backed by dollars or low-risk assets, imposes monthly reviews, and obliges issuers to publicly disclose the breakdown of their monthly reserves, and bans interest-bearing products.
President Donald Trump, who has previously called himself the “cryptocurrency president” and is openly pushing for reforms in favour of the sector, signed the bill into law on 18 July, after bipartisan support in both the House and Senate.
The move is part of a broader push that includes two other bills which recently saw the light of approval, the CLARITY Act, which aims to establish a clear market structure for cryptos, and The Anti-CBDC Surveillance State Act which aims to prevent the Federal Reserve from issuing a central bank digital currency (CBDC).
While supporters claim it will bring clarity and confidence to the cryptocurrency space, critics warn that it could introduce new risks by legitimising stablecoins without sufficient consumer protection.
A coalition of consumer and advocacy groups wrote in a letter to Congress this spring: “Some members may believe passage of this bill, even with flaws, is better than the status quo. We believe this is a fundamental misunderstanding of the risks involved with these instruments.”
Last week, Bitcoin surpassed the $120,000 mark, reaching an all-time high of $123,153.22.
The surge in bitcoin, which has risen 30 per cent so far this year, triggered a broader rally in other cryptocurrencies, including Ether, XRP and Solana, in an industry with a total market value of around $3.81 trillion, according to data reported by CoinMarketCap.
The rise marked a milestone for Bitcoin, suggesting growing optimism about cryptocurrency regulation and adoption by institutions.
