The proposed “GENIUS Act” (Guiding and Establishing National Innovation for US Stablecoins Act), aimed at regulating crypto and stablecoins, is facing major pushback. Ten US senators, some of whom previously supported the bill, have publicly voiced their opposition, citing serious concerns.
A Sudden Shift in Support
The about-face surprised many, especially since some senators who opposed the revised bill had previously backed it. Four Democratic senators—Ruben Gallego, Mark Warner, Marilyn Strickland Kim, and Lisa Blunt Rochester—were among those who changed their stance. Their concerns highlight the uncertainty surrounding the bill’s future.
Key Concerns: National Security and Money Laundering
The senators’ main concerns revolve around two key areas:
- National Security:
The revised bill lacks crucial safeguards, potentially leaving the nation vulnerable.
- Anti-Money Laundering (AML): The senators argue the bill’s weak AML protections could facilitate illegal activities.
They also worry that vague regulations could open the crypto market to exploitation.
Uncertainty in the Crypto Market
This unexpected opposition adds to the volatility already present in the crypto market. The new bill language was released just a day before the senators’ statement, leaving investors and traders in limbo. The lack of clear direction from lawmakers could significantly delay the bill’s passage, potentially for months. This delay could harm the development and expansion of crypto businesses within the US, especially concerning payment stablecoins, often used as a safe haven during market downturns.
Wider Implications: AI and Blockchain
The bill also aimed to boost innovation at the intersection of blockchain and artificial intelligence. The senators’ opposition is causing concern in the tech community, as projects in this area could be negatively impacted by the ongoing political stalemate.
The situation underscores the challenges of navigating the complex world of crypto regulation and the potential for unexpected political shifts to impact the tech industry.