Donald Trump Signs the GENIUS Act. What It Means for Crypto

Concluding the crypto week, the United States President Donald Trump signed the “Guiding and Establishing National Innovation for U.S. Stablecoins Act,” also known as the GENIUS Act, on Friday. This establishes a regulatory framework for stablecoins, a type of cryptocurrency whose value is pegged to existing assets, such as the U.S. dollar.

Trump Signs GENIUS Act

Before reaching the President’s desk, the GENIUS Act passed a 10-hour vote in the U.S. House of Representatives, with a count of 217-212. This marks the chamber’s longest vote ever.

Notably, the GENIUS Act is the first significant piece of crypto legislation President Trump is signing into law, living up to his promise of creating a crypto-friendly America under his administration.

The president’s crypto token, $TRUMP, saw some green candles after the signing. Although the memecoin did not see up to a 1% surge as of the time of writing, its 24-hour trading volume soared by over 27% to $995.36 million.

On the other hand, bitcoin (BTC), the world’s leading crypto, and other altcoins with high market capitalization did not react or move significantly after the signing.

What it Means for Crypto

Over the years, the crypto industry has sought regulatory clarity from various angles. Thus, the GENIUS Act is good news for the industry, as it addresses a longstanding issue for the digital asset ecosystem. Among other things, the GENIUS Act allows federally licensed banks and asset managers to issue their stablecoins when they meet specific criteria outlined by the government.

The GENIUS Act, signed into law, would ensure stablecoin regulation by establishing guidelines for stablecoin issuers. With the primary purpose of ensuring the safety of stablecoin holders, the legislation would require issuers to hold 100% of their assets in reserve, with a 1:1 stockpile of liquid assets. Moreover, stablecoin issuers would register with regulatory bodies and consistently submit to regular audits.

“This new stablecoin law will help unlock technologies that will transform how value moves around the world, expand access to the financial system, and unlock new economic opportunities for millions,” Avery Ching, CEO of Aptos Labs, commented on the new legislation.

Notably, by allowing asset managers to issue stablecoins, the GENIUS Act has the potential to increase adoption as it could bring cryptocurrency to the mainstream, thus driving the innovation of blockchain technology into day-to-day life.