US GENIUS Act Establishes Federal Framework for Dollar-Backed Stablecoins
The GENIUS Act, signed into law July 18, 2025, creates the first federal regulatory framework for payment stablecoins in the United States.
The GENIUS Act, signed into law on July 18, 2025, introduces the first comprehensive federal regulatory framework for dollar-backed stablecoins in the United States. The legislation sets clear rules for who can issue payment stablecoins, what assets must back them, and how holders can redeem tokens.
The law aims to provide legal clarity for stablecoin issuers and protect consumers by requiring full backing of tokens with high-quality liquid assets such as U.S. Treasuries or cash equivalents. Issuers must also meet transparency and reporting obligations.
- Issuance only by federally chartered or state-regulated entities meeting certain criteria
- Redemption rights for holders on a one-to-one basis
- Reserve requirements mandating high-quality liquid assets
- Oversight by federal banking regulators such as the OCC and Federal Reserve
The GENIUS Act represents a major step in U.S. digital asset policy, potentially influencing how stablecoins are used in payments and finance. It follows years of debate over whether states or the federal government should regulate stablecoins.