**Senators Reintroduce the GENIUS Act: A New Era for Stablecoin Regulation**
A bipartisan group of U.S. Senators has reintroduced the updated GENIUS Act, aiming to establish a comprehensive regulatory framework for stablecoins in the United States. This revised version of the bill, which was initially introduced in February, seeks to tackle important issues such as reserve requirements, anti-money laundering (AML) standards, and international cooperation for stablecoins. Senators Bill Hagerty (R-Tenn.), Tim Scott (R-SC), Kirsten Gillibrand (D-NY), and Cynthia Lummis (R-Wyo.) are leading this initiative. With significant changes made to the legislation, it is now poised for a crucial vote in the Senate Banking Committee on March 13.
**Key Updates to the GENIUS Act**
The updated GENIUS Act introduces several enhancements to strengthen the regulation of stablecoins, particularly for foreign issuers. A notable addition is the section on Reciprocity for Payment Stablecoins Issued in Overseas Jurisdictions, which now includes specific reserve requirements, liquidity standards, and sanctions compliance. These changes will make it more challenging for foreign stablecoin issuers to operate in the U.S. without adhering to these stringent rules.
In addition to international provisions, the updated bill incorporates anti-money laundering (AML) measures, counter-terrorism features, and risk management protocols. These enhancements are designed to ensure that stablecoins interacting with the U.S. payment system comply with U.S. security measures to prevent fraud. The revisions will provide greater clarity and regulation for stablecoins in the U.S., impacting major players like Tether (USDT) and Circle’s USD Coin (USDC), which currently dominate the market.
**Pro-XRP Lawyer Weighs In**
Jeremy Hogan, a lawyer and strong supporter of XRP, shared his insights on the updated GENIUS Act. He noted that the new reserve and compliance requirements could pose challenges for Tether’s operations in the U.S. Hogan also pointed out that the bill’s provisions regarding the interaction of federal and state laws with foreign law could benefit stablecoins like Ripple USD (RLUSD) and USDC. Additionally, he highlighted that the bill mandates issuers to possess the technological capability to freeze or burn stablecoins if required by law. This raises questions about the technical feasibility of these requirements, particularly for decentralized stablecoins. Hogan expressed concerns that this might create difficulties for issuers striving to remain compliant while maintaining the decentralized nature of their products.
**The Vote and What Comes Next**
The Senate Banking Committee is set to vote on the new GENIUS Act on March 13, 2025, which will determine whether it moves forward to a full Senate vote. If approved, the bill will proceed to the House for further consideration before reaching President Donald Trump for signing. Senator Bill Hagerty, one of the bill’s sponsors, emphasizes the importance of creating a safe and pro-growth environment for stablecoin innovation.
