Senate Pushes Forward with the GENIUS Act Crypto Legislation, Amidst Apprehensions
The CLARITY Act, a bill aimed at clarifying the regulatory framework for digital assets, has been passed by the House of Representatives with a bipartisan vote of 294 to 134. The bill, which defines when tokens qualify as securities or commodities and grants the Commodity Futures Trading Commission (CFTC) jurisdiction over “digital commodities,” is now awaiting consideration in the Senate [1][2][5].
The Senate version of the bill, the Responsible Financial Innovation Act of 2025, proposes giving the Securities and Exchange Commission (SEC) primary authority over certain digital assets, while still involving the CFTC for some regulatory rules. This Senate framework differs somewhat from the House version and is expected to incorporate changes after stakeholder feedback [3].
The passage of the CLARITY Act in the House comes amidst ongoing negotiations over the bill in the Senate. The Senate Banking Committee has released a draft legislation based on the CLARITY Act, but with a focus on the SEC's primary authority over digital assets. This shift in regulatory authority and consumer protection concerns are being worked out with the goal of final enactment in 2025 [1][3][5].
However, significant Senate hurdles remain, including the need to overcome a filibuster requiring 60 votes. Some Democratic senators, notably Senator Elizabeth Warren, have expressed concerns about digital asset regulatory approaches. Senator Warren has repeatedly raised concerns regarding President Trump's engagements with the crypto industry, asserting that Trump's crypto business allows for the trading of presidential favors for hundreds of millions, possibly billions of dollars from foreign governments, billionaires, and large corporations [6][7].
Meanwhile, the GENIUS Act, a stablecoin regulation bill, has faced its own set of challenges. The bill, which aims to integrate cryptocurrency into mainstream finance, has been backed by Brian Armstrong and 60 crypto executives, but faced a procedural setback during a May cloture vote. However, the Senate recently voted 68-30 to advance the GENIUS Act, clearing the path for comprehensive debate and a subsequent full floor vote [4].
David Sacks, White House "AI and crypto czar", anticipates the GENIUS Act's eventual bipartisan passage in the Senate. However, Senator Warren has expressed concerns regarding fundamental flaws within the GENIUS Act, contending that it is undermined by numerous vulnerabilities and offers inadequate safeguards for consumers, national security, and the broader financial system [8].
As of May, the House's companion stablecoin legislation, the STABLE Act, was still under review by its Financial Services Committee [9]. The ongoing debates and negotiations in both the House and the Senate underscore the growing importance of digital assets and the urgent need for clear, effective regulation.
References:
- CoinDesk
- Bloomberg
- Politico
- Reuters
- The Block
- CNBC
- Forbes
- Decrypt
- The Hill
- The CLARITY Act, having passed in the House, now moves on to the Senate, where it will undergo changes in response to stakeholder feedback, especially in regards to the Securities and Exchange Commission's primary authority over digital assets.
- In the Senate, the Responsible Financial Innovation Act of 2025 has been drafted, which proposes giving the Securities and Exchange Commission primary authority over certain digital assets while still involving the Commodity Futures Trading Commission for some regulatory rules.
- The GENIUS Act, a stablecoin regulation bill, has faced challenges, including a clot greeted by concerns from senators like Elizabeth Warren, who contends the bill is undermined by numerous vulnerabilities and offers inadequate safeguards.
- As the Senate considers the CLARITY Act and the GENIUS Act, ongoing debates and negotiations are reflective of the growing importance of technology in the finance business, general-news, politics, and the urgent need for clear, effective regulation.
