/>iThe first piece of legislation to regulate cryptocurrencies in the United States is now law.
The bipartisan passage of the Guiding and Empowering Nation-based Innovation Using Stablecoins Act of 2025—better known as the GENIUS Act, the first-of-its-kind stablecoin bill–is emblematic of the Trump administration’s willingness to embrace innovative and disruptive technologies and illustrates the years-long fight for clarity from the crypto industry. Sponsored by Senators Bill Hagerty (R-TN), Kirsten Gillibrand (D-NY), Cynthia Lummis (R-WY), and Tim Scott (R-SC),)’—longstanding advocates for sensible digital asset legislation—the GENIUS Act passed with broad support in both the House and Senate before being signed into law by President Donald J. Trump on July 18, 2025. It is more than an authorization of crypto; it’s a clear indicator of how the U.S. now intends to approach emerging industries. This development is not solely about supporting stablecoins’ growth and potential to be a part of our financial system. It’s a milestone for digital asset regulation, the evolution of financial services, and proper oversight of a nascent, yet burgeoning industry.
Until now, companies like Grayscale, Ripple, Circle and countless others worked tirelessly to provide blockchain-based products and services, but lacked coherent rules of the road. The previous administration's hostility to the industry helped galvanize the current fight for clear legislative guidelines from the government. With this historic piece of bipartisan legislation, the industry takes one giant step forward towards adoption, a market regulatory framework, and restoring America’s place as an industry leader.
The bill enacts a number of guidelines that provide clear rules for companies issuing stablecoins, such as PayPal, Ripple, and JP Morgan, to abide by and ensure legal compliance. The Act answers the fundamental question of how to integrate a new technology into an existing industry while protecting consumers, ensuring security, and maintaining stability. Under the GENIUS Act, “permitted payment stablecoin issuers” like Circle or Bank of America can issue stablecoins for public use in the U.S. Additionally, the bill establishes protections for consumers by clarifying reserve, liquid, and disclosure obligations that mirror traditional financial institutions.
The Act’s effects are two-fold: it outlines clear provisions for stablecoin issuers, and its passage into law signals a new legitimacy for the industry and technology, helping to foster confidence in the digital assets space for consumers and traditional financial institutions. The 1:1 reserve backing, mandatory third-party audits, and regular public disclosures all lend themselves to affirming the legitimacy of the space.
A prior concern among industry experts and investors was the lack of legislative clarity surrounding whether digital tokens themselves were considered securities. The 2023 landmark SEC v. Ripple decision in the U.S. District Court for the Southern District of New York determined the XRP token is not a security when sold on public exchanges. Still, the ruling did not provide blanket certainty for the digital asset class as a whole. The GENIUS Act carves out a new specific category for stablecoins, clearly categorizing them as non-securities and distributing their oversight to a number of agencies.
Each of these elements in the GENIUS Act–compliance standards and market-structure classification–directly addresses concerns or risk factors that previously deterred individuals and institutions from participating in the digital assets economy.
For too long, the digital asset space has been a legal vacuum, relying on case-by-case rulings rather than clearly defined statutes. A space that wanted to abide by the rules of the road was not given any. The GENIUS Act begins filling this void by providing a defined legal path forward. It does not inhibit innovation but rather encourages it. As the administration seeks to set a global precedent for insightful crypto regulation, the Genius Act is the first step to cementing the U.S. as the global leader in the convergence between traditional finance and decentralized finance.
Roslyn Layton is a research fellow at Aalborg University Technical Faculty of Information Technology and Design, Department of Electronic Systems. The author neither owns nor trades cryptocurrencies. The views and opinions expressed in this article are those of the author and not necessarily those of The National Law Review.
