The revised GENIUS Act (S.1582) in the U.S. Senate introduces sweeping changes to stablecoin regulation. Foreign-based stablecoin issuers, most notably Tether (USDT), would now be required to comply with U.S. laws if they serve users in the United States. This marks the most significant regulatory push yet to bring global stablecoin providers under American oversight.
The bill further broadens the definition of digital asset service providers to include developers, validator nodes, and self-custody wallet providers. These entities could be made subject to Bank Secrecy Act and Anti-Money Laundering (AML) laws—posing considerable compliance challenges, especially for the decentralized finance (DeFi) sector. Critics argue that imposing such obligations threatens DeFi’s foundational principles and could stifle innovation or drive activity offshore.
Additional provisions persist from older drafts: stablecoins must be fully backed by reserves, and issuers are mandated to disclose comprehensive information about their backing assets and operations. Though the revised bill expands the asset types eligible for backing, it also introduces strict licensing and disclosure requirements.
The latest version, backed mainly by Republican senators, failed to reach formal Senate debate due to inadequate bipartisan support, but proponents expect another vote by the month’s end. Many experts see this as a crucial step toward shaping the U.S. approach to stablecoin and DeFi regulation, influencing both industry practices and future legislative efforts—even if this version stalls.
