WASHINGTON, D.C. — President Donald J. Trump on Friday signed into law the Guiding and Establishing National Innovation for U.S. Stablecoins Act, or GENIUS Act, marking a major step toward comprehensive federal oversight of payment stablecoins and bolstering the United States’ position in the global digital asset economy.
The legislation introduces the first national regulatory framework for stablecoins—digital assets typically pegged to the U.S. dollar—aimed at enhancing transparency, consumer protection, and financial stability. It mandates that all stablecoins issued under the new framework be fully backed by highly liquid assets such as U.S. dollars or short-term Treasury securities, with monthly public disclosures on reserves. Marketing restrictions will also prevent issuers from falsely implying government endorsement or insurance.
“This law protects consumers from deceptive practices, creates guardrails for responsible innovation, and reinforces the dominance of the U.S. dollar,” the administration stated.
In the event of a stablecoin issuer’s insolvency, the law prioritizes consumer claims above other creditors, establishing an unprecedented level of protection for holders of these digital assets.
Beyond consumer protections, the GENIUS Act is designed to stimulate domestic demand for U.S. Treasury instruments, reinforcing the dollar’s status as the world’s reserve currency. Stablecoin issuers will be required to back tokens with Treasuries, increasing systemic reliance on U.S. sovereign debt and further integrating digital finance with traditional markets.
From a national security standpoint, the law imposes anti-money laundering (AML) and sanctions compliance obligations under the Bank Secrecy Act. Issuers must now implement formal compliance programs, verify customer identities, and maintain the technical ability to freeze or destroy tokens when compelled by legal authorities.
The GENIUS Act is the culmination of a broader digital asset strategy initiated by the Trump administration earlier this year. Executive actions have included the formation of a Strategic Bitcoin Reserve and a Digital Asset Stockpile, signaling a full embrace of cryptocurrency as a pillar of future U.S. financial infrastructure.
The administration described the legislation as a pivotal moment for America’s economic and technological leadership. “Digital assets are the future, and our nation is going to own it,” President Trump said in earlier remarks. “We are talking about massive investment and big innovation.”
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