The Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, passed in a 66-32 Senate vote on May 20.
“The motion to invoke cloture on the motion to proceed to the consideration of the GENIUS Act has passed,” reported Fox’s Eleanor Terrett.
She added that more than 15 Democrats flipped their votes from no to yes, but Senate Minority Leader Chuck Schumer voted no.
The passage has cleared a key procedural hurdle after Democratic senators initially blocked the bill earlier in May. This vote to invoke cloture, a procedural motion that limits debate on a matter and requires a super-majority vote, now sets up the bill for floor debate.
Stablecoin Regulation Moves Forward
The GENIUS Act was introduced by Senator Bill Hagerty in February with the goal of regulating the $248 billion stablecoin market.
The legislation would require stablecoins to be fully backed, undergo regular security audits, and receive approval from federal or state regulators. It restricts issuance to licensed entities and imposes limitations on algorithmic stablecoins and those without full backing.
“This groundbreaking, bipartisan legislation will bring America’s payment system into the 21st century,” said Senator Hagerty on X.
He added that it will ensure US dollar dominance and protect customers. He also predicted that “the demand for US Treasuries will balloon to the tune of more than $1 trillion, and innovation in the digital asset space will thrive in the United States going forward.”
“Digital assets are the future, and now we’re one step closer to ensuring America leads the way,” commented Senator Cynthia Lummis.
Democratic senators had previously withdrawn support, citing concerns about potential conflicts with President Trump’s crypto investments and anti-money laundering concerns.
However, the legislation was subsequently revised to secure enough bipartisan support to move forward. It now heads to the floor where the Senate will engage in a formal debate on the bill, discuss its merits, propose amendments, and express concerns.
Urgency Urged by Lummis
Senator Lummis indicated she hopes to complete this process by May 26 (Memorial Day), suggesting an accelerated timeline for the remaining procedural steps.
The stablecoin market is currently dominated by Tether, which has a commanding 61% market share with $151 billion USDT in circulation. Its closes rival, Circle, has a 24% market share with just over $60 billion USDC issued.
In early April, related legislation, the Stablecoin Transparency and Accountability for a Better Ledger Economy (STABLE) Act, was passed by the House Financial Services Committee.
