() — President Donald Trump approved the initial federal legislation aimed at regulating stablecoins, calling it a "major advancement in securing America's leadership in global finance and cryptocurrency innovation," marking a significant triumph for the digital assets sector.
The Genius Act establishes a straightforward and easy-to-understand regulatory system to unlock the significant potential of dollar-pegged stablecoins," Trump stated on Friday during a White House event. "This might be the most substantial breakthrough in financial technology since the emergence of the internet.
The regulation establishes guidelines for U.S. dollar-pegged stablecoins, requiring companies to maintain full reserve backing through short-term governmental securities or comparable instruments regulated at either the state or national level. Supporters believe this will facilitate wider use of digital currencies within financial systems.
High-ranking treasury representatives spoke with journalists on Friday morning, but requested anonymity. They mentioned that the legislation aims to offer greater clarity to stablecoin providers, encourage progress within the digital asset sector, and promote wider usage of these assets, thereby reinforcing the global influence of the U.S. dollar. The measure was described as imposing rigorous standards on stablecoin issuers regarding collateralizing their coins with either cash or brief-term government bonds.
Trump stated that the action would "ensure the dollar remains the global reserve currency," noting that relinquishing this role would be "similar to suffering a defeat in a worldwide conflict."
"With the confidentiality, adaptability, and decentralized nature of physical money, this transformation could significantly boost U.S. economic expansion and enable millions to store and send funds in U.S. currency," he stated.
The text highlights a significant shift in politics for an emerging sector that Trump initially viewed skeptically but later supported. The law became the focus of an initiative the president promoted as "Crypto Week."
Trump was accompanied by technology and cryptocurrency leaders, such as Brian Armstrong from Coinbase Global Inc., Vlad Tenev of Robinhood Markets Inc., the wealthy twin brothers Cameron and Tyler Winklevoss who founded the Gemini exchange, and Chris Pavlovski of Rumble Inc.
"This agreement represents significant recognition of your dedication and innovative mindset, as well as your determination not to quit," Trump said to the cryptocurrency leaders.
After being severely impacted by the dramatic downfall of Sam Bankman-Fried's FTX cryptocurrency exchange, supporters of the recently enacted legislation claim the sector will now benefit from a more stable and clear regulatory framework and legitimacy for the asset class.
The law was approved by the House with wide cross-party backing following a months-long an effort that was nearly thwarted by conservative legislators who held up The bill requested a clause banning the Federal Reserve from introducing digital money. The conservative faction met with Trump at the White House, eventually dropping their blockade After the House leaders informed them that a provision concerning central bank digital currencies would be included in a defense authorization bill later this year.
The Democrats made an unsuccessful attempt to include a clause in the bill that would prohibit public office holders and their relatives from participating in stablecoin activities. This proposal raised concerns about potentially affecting Trump and his family, who are associated with digital asset companies such as World Liberty Financial, which operates its own token and stablecoin. Certain Democratic opponents expressed worries that the law lacks sufficient consumer protection measures and might result in demands for governmental assistance should digital currencies collapse.
The passage of the bill signifies the growing influence of cryptocurrency investors and company leaders within politics, after they utilized heavily financed political action committees during the 2024 election to endorse lawmakers supportive of their sector. Trump received significant backing from the crypto industry throughout his campaign.
Explainer: How Trump Shifted His Stance on Cryptocurrency – And What the Crypto World Expects in Exchange
Trump selected venture capital investor David Sacks from Craft Ventures LLC as the inaugural White House... The head of artificial intelligence and cryptocurrency Person in charge of AI and digital currency Executive overseeing AI and blockchain technologies Top official for artificial intelligence and crypto matters Leader responsible for AI development and cryptocurrency policies Chief authority on AI and virtual currencies Head of operations for artificial intelligence and crypto initiatives Principal figure managing AI and financial technology advancements Senior executive handling AI and decentralized finance Lead administrator for artificial intelligence and cryptographic systems .
The president welcomed business executives to the White House in March and enacted a executive order Advocating for the establishment of a Strategic Bitcoin Reserve along with an additional collection of various digital assets. His government has also committed to promoting cryptocurrency-supportive regulatory bodies and has halted or suspended legal actions and inquiries targeting companies such as Coinbase, Robinhood, Uniswap Labs, and OpenSea.
"I helped you all get out of a lot of trouble," Trump said to the executives assembled at Friday's event.
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