The GENIUS Act's passage marks the first major crypto legislation approved by both chambers of Congress, signaling a significant step toward regulatory clarity for stablecoins, while the CLARITY Act's advancement by the House reflects ongoing efforts to establish broader cryptocurrency regulation.
GENIUS Act Updates
By a 308-122 vote in the House, the Guiding and Establishing National Innovation for U.S. Stablecoins Act ("GENIUS Act") cleared both chambers of Congress and was signed into law by President Trump. The statute will create the first comprehensive national regime for "payment stablecoins" and mark the first significant federal regulatory framework for crypto assets.
As discussed in our recent Commentary, "Senate Passes GENIUS Act, Clearing Hurdle for Federal Stablecoin Framework," issuers with more than $10 billion in total issuances will be subject to direct federal oversight, notably from the Office of the Comptroller of the Currency, and heightened regulatory standards. Smaller issuers may opt into substantially similar state regimes. Federal regulators are expected to play a key part in the implementation of the Act in terms of rulemaking and enforcement, having been vested with, inter alia, the power to issue cease-and-desist orders and take civil money penalty actions. The Act also clarifies that payment stablecoins are neither securities nor commodities.
CLARITY Act Updates
The House also adopted the Digital Asset Market Clarity Act ("CLARITY Act") by a 294-134 margin. The bill now moves to the Senate, where significant amendments are possible given that commentators expect high scrutiny.
As discussed in our recent Commentary, "Congress Introduces CLARITY Act to Establish Digital Asset Regulatory Framework," the bill would split jurisdiction between the Commodity Futures Trading Commission ("CFTC"), overseeing "digital commodities," and the Securities and Exchange Commission ("SEC"), overseeing "restricted digital assets." The bill also creates a provisional registration pathway while both the SEC and CFTC finalize rules; expands a safe harbor for non-custodial decentralized finance participants such as developers and validators; and clarifies that assets sold pursuant to investment contracts may transition to digital-commodity status once a network is sufficiently decentralized.
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