The GENIUS Act Passes Senate, But Trump’s Crypto Holdings Remain Unaddressed
The GENIUS Act, a landmark bill to regulate stablecoins, passed the US Senate on June 17, 2025, marking a major step toward federal oversight. The 68-30 bipartisan vote positions the US as a global leader in digital assets. However, critics argue the Act sidesteps one of its most contentious subjects: former President Trump‘s extensive crypto interests. Here’s a deep dive.
Genesis of the GENIUS Act
For years, the stablecoin market, worth around $240 billion, has operated under a patchwork of fragmented state and agency rules. Without clear federal guidelines, issuers and users faced uncertainty, which risked pushing innovation overseas.
- Stabilizing the market: Under the GENIUS Act, issuers must fully back stablecoins with dollar-equivalent reserves (cash or Treasuries), undergo regular audits, and comply with anti-money-laundering (AML) protocols.
- Cutting off unchecked foreign and non-financial issuers: It bars companies outside the banking realm, including foreign tech firms, from launching stablecoins on U.S. soil.
- Guarding against insider profiteering: The Act expressly prohibits members of Congress and their immediate family from issuing stablecoins.
This framework represents a milestone: the first federal law designed to regulate private money issues in the US, blurring both market clarity and consumer trust.
Bipartisan Achievement With Strong Opposition
Despite broad support, the bill faced resistance:
- Initial Democratic pushback stemmed from concerns over President Trump’s connections to crypto projects, especially his memecoin $TRUMP and World Liberty Financial.
- Senator Elizabeth Warren and others decried the bill’s weak ethics provisions, noting it still allows the Trump family ownership of related crypto ventures.
- Two Senate Republicans, Rand Paul and Josh Hawley, voted no over fears of empowering big tech.
The Big Loophole: Trump Exemption
Although the act restricts members of Congress and their dependents, it notably excludes the president and their family. That means Trump and related entities retain legal freedom to profit from crypto, even stablecoins covered by the law.
According to public disclosures, Trump earned around $57.35 million from World Liberty Financial token sales in 2024 and hosted an investment dinner tied to his memecoin.
Ethics experts warn this loophole leaves the door open for regulatory capture, and Trump could influence rules governing his own crypto.
Industry and Market Response
The bill’s passage met with immediate market reactions:
- Circle Financial, a publicly traded U.S. stablecoin issuer, welcomed regulation as a legitimizing catalyst.
- Tether, the dominant global stablecoin, faces new headwinds, issues of reserve transparency, and foreign domicile is now a liability.
- ARK Invest reportedly sold $44.7 million in Circle shares, signaling short-term recalibration.
- Treasury projections: Secretary Scott Bessent estimated stablecoins could swell to a $3.7 trillion market by 2030.
This shift shows regulated stablecoins are becoming serious contenders in mainstream finance, with legacy banks like JPMorgan and Fintech giants like Amazon exploring token initiatives.
Next Steps: House Review and Closing the Loophole
The GENIUS Act now moves to the Republican-controlled House, which may align the Senate’s bill with the STABLE Act or combine stablecoin legislation with larger crypto reforms like the Clarity Act.
- Amendment focus: Ethical corrections, extending restrictions to the President and family, are expected. Consumer safeguards and foreign issuer limits may also tighten.
- Time pressure: Republican leadership and the White House aim to finalize before the August recess, giving proponents less than seven weeks.
The bill’s successful House passage will test whether bipartisanship can hold and whether Trump’s crypto stance faces viable legislative checks.
Conclusion
The passage of the Genius Act is a major milestone in US crypto policy, offering regulatory certainty for stablecoins. Yet it leaves a critical issue unresolved: former President Trump‘s substantial holdings and influence in the same digital asset realm. With potential revenue from his memecoin and Stablecoin ventures still protected, the Act raises concerns about fairness and oversight. As the bill advances to the House, lawmakers face mounting pressure to close that loophole. The future transparency and integrity of US crypto regulation depend on it.
FAQs
A bipartisan Senate bill establishing the first federal framework for stablecoins, featuring reserve, audit, and AML rules.
No. While it restricts Congress members, the nullification of presidential exclusion means Trump and his family are unaffected.
According to disclosures, he earned approximately $57.35 million from his token sales in 2024.
Ethics advocates warn that the Act enables presidential profiteering and regulatory manipulation. Critics also stress weak consumer protections and national-security loopholes.
Disclaimer:
This content is made for learning only. It is not meant to give financial advice. Always check the facts yourself. Financial decisions need detailed research.