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Trump Signs GENIUS Act Into Law: Stablecoins, Crypto Adoption, And More…
In a major coup for the cryptocurrency community, former President Donald Trump has signed the “Guiding and Establishing National Innovation for U.S. Stablecoins Act,” or GENIUS Act, into law. The newly enacted legislation aims to regulate payment stablecoins, foster crypto adoption, and potentially shape the future of digital finance.
The GENIUS Act is a testament to the growing importance of cryptocurrencies in the global financial landscape. By signing this bill into law, Trump has taken a significant step towards standardizing the industry and providing much-needed clarity for investors and issuers alike.
The act establishes a new regulatory framework that enables companies to receive federal charters or work with state regulators, provided their programs meet specific requirements. This dual-track system is expected to increase competition in the market, promote innovation, and reduce uncertainty.
One of the most significant changes introduced by the GENIUS Act is the requirement for all payment stablecoins to be fully backed by cash or short-term U.S. Treasuries. Issuers are prohibited from lending out or reusing these reserves, ensuring greater transparency and trust in the system.
Another key aspect of the legislation is the temporary pause on the issuance of new algorithmic coins, which have been known for their volatility. The two-year moratorium aims to address concerns surrounding the TerraUSD meltdown and protect consumers from potential losses.
The Office of the Comptroller of the Currency (OCC) will take the lead in overseeing payment stablecoins, while the Federal Reserve plays a supporting role. A new committee dedicated to approving state-level plans has also been established.
In addition to these measures, the act introduces mandatory transparency and audit requirements for issuers. This includes publishing monthly certified breakdowns of reserves, with CEOs and CFOs required to sign off on the reports. Independent accounting firms will conduct regular audits to ensure compliance.
The GENIUS Act takes a significant step by declaring payment stablecoins are not securities or commodities, effectively removing the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) from regulation in this space.
This move is seen as a direct response to the “regulation-by-enforcement” strategy that has frustrated industry leaders. The Treasury will continue to study other types of stablecoins alongside the SEC and CFTC, leaving no room for misunderstanding or misinterpretation.
The signing of this act by Trump marks an unprecedented opportunity for the United States to take a leading role in digital finance. It is clear that Washington policymakers are committed to fostering innovation while addressing concerns over consumer protection.
In conclusion, the impact of the GENIUS Act on the global crypto landscape will be keenly observed and debated over the coming days.
Source: ambcrypto.com
