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Investing.com-- The U.S. Senate on Tuesday passed a bill outlining a regulatory framework for cryptocurrencies that are directly pegged against the dollar, now setting up the bill for a House of Representatives vote.
The bill, called the GENIUS Act, was backed by both Democrats and Republicans and approved in a 68-30 vote. The bill will now head to the Republican-controlled House of Representatives before it can be sent to President Donald Trump’s desk to be signed into law.
The GENIUS Act’s Senate approval marks a major milestone for U.S. crypto regulation, and comes in line with Trump’s promises of passing crypto-friendly regulation.
Stablecoins are a type of crypto that are designed to maintain a constant peg against mainstream currencies, usually the dollar. They are used largely to facilitate crypto transactions, and have seen growing use in recent years.
Proponents also claim that they can be used to send payments instantly. Currently, Circle’s USDC and Tether’s USDT are the largest stablecoins in the market.
The GENIUS Act, if approved, will require stablecoin issuers to back their currencies with liquid assets such as the dollar and short-term Treasuries. Issuers will also be required to publicly disclose the composition of their reserves every month.
But despite the positive development for the bill, crypto markets remained on the backfoot. Bitcoin fell 2.1%, extending recent losses as risk appetite was battered by a worsening Iran-Israel conflict.