The US House of Representatives has passed groundbreaking federal cryptocurrency legislation known as the GENIUS Act, establishing comprehensive new rules for the issuance and operation of stablecoins within the United States.
The core mandate of the legislation requires all stablecoin issuers operating in the US market to hold 100% reserves backing their tokens at all times. Furthermore, the Act explicitly prohibits the issuance and use of unbacked algorithmic stablecoins.
The bill now awaits an anticipated signature from President Trump. Upon signing, the law will take effect in 2026. This timeline grants federal regulatory agencies, including the Federal Reserve and the Office of the Comptroller of the Currency (OCC), a period to prepare for and implement the new oversight requirements.
Legislators designed the GENIUS Act to provide long-sought clarity for the stablecoin sector. The goal is to establish clear legal parameters that foster innovation while simultaneously mitigating systemic risks posed by insufficiently collateralized or algorithmic models.
Initial reactions from the cryptocurrency industry suggest these regulations are largely viewed as a critical step towards regulatory certainty for stablecoins. However, ongoing dialogue is expected to address the practical challenges of balancing rigorous compliance with continued digital finance innovation.
The passage of the GENIUS Act represents a historic milestone, marking the first comprehensive federal regulatory framework for stablecoins in the United States, firmly emphasizing the principles of full reserve backing and strong regulatory oversight.