GENIUS Act Passes Senate

State of play

Today the Senate passed the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act) (available here) by a 68-30 vote, with strong bipartisan support.
Acompeting bill called the Stablecoin Transparency and Accountability for a Better Ledger Economy Act of 2025 (STABLE Act) (available here) advanced out of the House Financial Services Committee (HFSC) in April 2025.
With President Trump's goal of signing stablecoin legislation by August, some version of the two bills may soon become law.
Both bills are heavily inspired by former HFSC Chair Patrick McHenry's Clarity for Payment Stablecoins Act of 2023. While the two bills have been converging, a few important differences remain.
We describe the key components of each bill, along with key differences, on the subsequent slides. Descriptions apply to both the GENIUS Act and STABLE Act unless otherwise noted.
We have prepared a blackline comparing the GENIUS Act against the STABLE Act, available here.

Key definitions and concepts

Payment stablecoin. A digital asset:

that is or is designed to be used as a means of payment or settlement;
the issuer of which:
- is obligated to convert, redeem, or repurchase for a fixed amount of monetary value, not including a digital asset denominated in a fixed amount of monetary value, and
- represents that such issuer will maintain, or create the reasonable expectation that it will maintain, a stable value relative to the value of a fixed amount of monetary value; and
that is not a national currency, deposit, or otherwise a security

Distributed ledger. Unclear whether an asset recorded on a private, permissioned blockchain could fall within the definition of "digital asset" or "payment stablecoin."

Interest. A permitted payment stablecoin issuer cannot pay payment stablecoin holders yield or interest.

GENIUS Act also applies this prohibition to foreign payment stablecoin issuers.

Securities classification. Expressly states that payment stablecoins are not securities and permitted payment stablecoin issuers are not investment companies.

Tokenized deposits. Explicitly out of scope.

Permitted federal issuers and primary regulator 3

Permitted federal issuers	Primary regulator in both GENIUS Act and STABLE Act*
Subsidiary of an IDI**	The insured depository institution's (IDI) appropriate federal banking agency

Federal qualified issuer Office of the Comptroller of the Currency (OCC)

GENIUS Act:

A "nonbank entity" (defined as a person that is not a depository institution or subsidiary of a depository institution)
An uninsured national bank
A federal branch of a foreign bank

STABLE Act:

A subsidiary of a "nonbank entity" (defined as a person that is not an IDI or subsidiary of an IDI)

Permitted state issuers and primary regulator

The appropriate state regulator is the primary regulator of state issuers in both the GENIUS Act and STABLE Act, with the Federal Reserve Board (FRB) or OCC having secondary authority.

GENIUS Act:

State issuers with less than $10 billion in payment stablecoins outstanding can opt into a state-only regime, provided it is (1) certified by the applicable state regulator as "substantially similar" to the federal regime and (2) the Stablecoin Certification Review Committee, composed of the Treasury Secretary, Chair of the FRB (or Vice Chair for Supervision) and Chair of the Federal Deposit Insurance Corporation (FDIC), does not reject the certification. Treasury Secretary must establish broad-based principles through notice and comment rulemaking for determining what is deemed "substantially similar."**
The Stablecoin Certification Review Committee must endeavor to expedite certification of state regulatory regimes if they were in place within 180 days after GENIUS Act's enactment and provide a prudential regulatory regime for the supervision of digital assets or payment stablecoins.

STABLE Act:

Same as GENIUS Act, except (1) state-only regime available to all state issuers regardless of size, (2) certification that state regime's requirements "meet or exceed" the federal regime's requirements is made only to the Treasury Secretary (and only Treasury Secretary may reject a certification) and (3) no process for expedited certifications.

Treatment of foreign payment stablecoin issuers 5

Bill

Treatment of foreign payment stablecoin issuers

GENIUS Act

Must be a permitted payment stablecoin issuer to "issue a payment stablecoin in the United States."

A payment stablecoin issued by a foreign payment stablecoin issuer cannot be traded on U.S. custodial trading platforms unless the foreign payment stablecoin issuer (1) satisfies a safe harbor to be established by the Treasury Secretary or (2) the issuer:*

complies with lawful orders to seize, freeze, burn, or prevent the transfer of outstanding stablecoins;
is subject to a "comparable" regulatory regime, as determined by the Treasury Secretary upon a recommendation by each of the other members of the Stablecoin Certification Review Committee;
registers with the OCC and becomes subject to OCC oversight;
holds reserves in U.S. financial institutions sufficient to meet liquidity demands of U.S. customers; and
is not domiciled and regulated in a jurisdiction subject to comprehensive U.S. economic sanctions or determined by the Treasury Secretary to be a jurisdiction of primary money laundering concern.

A foreign payment stablecoin shall not be:

treated as cash or as a cash equivalent for accounting purposes;
eligible as cash or as a cash equivalent margin and collateral for SEC- and CFTC-regulated intermediaries; or
acceptable as a settlement asset to facilitate wholesale payments between banking organizations or by a payment infrastructure to facilitate exchange and settlement among banking organizations.

STABLE Act

Like the GENIUS Act, must be a permitted payment stablecoin issuer to "issue a payment stablecoin in the United States."

Following 18 months after enactment of the bill, a foreign payment stablecoin cannot trade on U.S. custodial trading platforms, unless (1) the Treasury Secretary determines that the foreign regime's requirements are "comparable" to those in the bill and (2) the foreign payment stablecoin issuer consents to be subject to reporting and examination requirements as determined by the OCC (for nonbank issuers) or FRB (for bank issuers).

Key difference: treatment of non-financial issuers 6

Bill

Restrictions on non-financial stablecoin issuers

GENIUS Act

A U.S. public company and any non-U.S. company that is not predominantly engaged in one or more financial activities, and its wholly or majority-owned subsidiaries or affiliates, may not issue a payment stablecoin unless the public company obtains a unanimous vote of the Stablecoin Certification Review Committee finding that:

it will not pose a material risk to safety and soundness of the U.S. banking system or financial stability;
the public company will comply with data use limitations; and
the public company and its affiliates will comply with anti-tying requirements.

Stablecoin Certification Review Committee must issue an interpretive rule clarifying these requirements within one year of enactment of GENIUS Act.

STABLE Act

No specific restriction.

Reserve requirements 7

Reserve composition

Reserve disclosures

Rehypothecation

Redemption

Payment stablecoins must be backed on at least a 1:1 basis (i.e., issuer must maintain at least a 100% reserve).

Payment stablecoin issuers must publish monthly reports certified by the CEO and CFO disclosing the state of reserves. Criminal penalties for knowingly false certifications.

Reports must be examined monthly by a registered public accounting firm.

Prohibition on rehypothecation, except for pledging short-term Treasuries for repurchase agreements.

Issuers must have procedures to process "timely" redemptions.

Eligible assets:

GENIUS Act: cash; demand deposits; Treasuries with maturities of 93 days or less (short-term Treasuries); money received under repurchase agreements backed by short-term Treasuries; reverse repurchase agreements overcollateralized by Treasuries and subject to certain market terms; securities issued by a registered investment company invested solely in the above assets; tokenized versions of any of the above. Includes catch-all for other "similarly liquid federal government-issued assets" approved by regulators.
STABLE Act: Materially similar to GENIUS Act, except no tokenized versions of eligible assets and no catch-all.

To view the full pdf, click here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.