stablecoin regulatory act impact

Key Points:* GENIUS Act passes Senate hurdle, backed by White House.

• Could boost U.S. Treasury bond demand significantly.
• Raises conflict of interest questions for Trump family. On May 22, the U.S. Senate advanced the GENIUS Act, a policy led by Senators Bill Hagerty and Kirsten Gillibrand. The bill targets stablecoin regulation, heralding a shift in the market valued at around $232 billion.

The Act’s approval is pivotal as it offers a regulatory framework for stablecoins, previously unregulated, now aligned with guidelines to maintain U.S. dollar dominance. David Sacks, Trump’s crypto adviser, emphasized the bill’s potential to generate trillions of dollars in Treasury bond demand.

Senate’s GENIUS Act Spurs Trillions in Bond Demand

The GENIUS Act achieved a significant milestone in the Senate. Breaking through a Senate procedural vote indicates new bipartisan support for regulating stablecoins. David Sacks explained that the Act could unlock “trillions of dollars” for U.S. Treasury bonds as stablecoin issuers bolster their reserves.

The legislation is set to usher in mandatory reserve standards, promoting U.S. Treasury investments among stablecoin firms like Tether and Circle. With the $232 billion stablecoin market now under potential regulation, the bill is anticipated to enhance the U.S dollar’s global position.

“The bipartisan GENIUS Act will provide regulatory clarity to this important industry, keep innovation on shore, add robust consumer protection, and reaffirm the dominance of the U.S. dollar,” said Senator Kirsten Gillibrand, Co-sponsor of the GENIUS Act, U.S. Senate.

First Federal Stablecoin Regulation Promises Market Shift

Did you know? The GENIUS Act marks the first successful federal attempt at stablecoin regulation in the U.S., contrasting with previous legislative efforts hindered by partisan disputes.

CoinMarketCap reports Tether USD (USDT), with a market cap of approximately $151.95 billion, holds a 4.39% market dominance. Its 24-hour trading volume has surged by over 56.81%, reaching $129.26 billion. USDT’s price remains at $1.00, with 0.01% change in the last 24 hours, dated May 22, 2025.

Tether USDt(USDT), daily chart, screenshot on CoinMarketCap at 01:21 UTC on May 22, 2025. Source: CoinMarketCap Coincu research assesses that the GENIUS Act could shift trillions towards Treasuries. Historical trends suggest that regulation generally boosts investor confidence, potentially increasing capital flows into compliant crypto and DeFi entities, benefiting from enhanced market legitimacy.