A new regulatory race is unfolding in Washington after Congress pushed the most consequential stablecoin legislation in U.S. history over the finish line this summer.
Key Takeaways
U.S. regulators are now racing toward a July 2025 deadline to fully implement the GENIUS Act.
The law requires strict backing, annual audits, and new licensing rules for stablecoin issuers.
Political tensions are rising as lawmakers question President Trump’s involvement in crypto ventures.
With the GENIUS Act now law, federal agencies have been thrown into a countdown — and the political pressure around digital assets is intensifying just as quickly.
GENIUS Act Sets a Hard Deadline – and a Big Job
Rather than focusing on enforcement first, regulators are beginning with the far more complex task of designing an entirely new licensing and oversight structure.
The law demands that all rules be finalized one year from its passage, setting July 2025 as the point by which agencies must complete everything from the issuer application process to the audit standards for large stablecoin operators.
The scramble was visible during this week’s hearing on Capitol Hill, where lawmakers pressed regulators not on policy debates — but on whether they could meet the clock.
Regulators Signal Their First Moves
What’s unusual is how more than half a dozen agencies now share responsibility.
The Federal Reserve, the FDIC, the NCUA, and the OCC are all drafting their own pieces of the GENIUS framework.
FDIC Acting Chair Travis Hill announced before the hearing that his team expects to publish the agency’s first rule proposal this month, signaling that the implementation phase is fully underway.
NCUA Chairman Kyle Hauptman added that his agency’s opening rulemaking will focus on how institutions can apply to become approved stablecoin issuers, calling it the logical first step.
What the Law Demands From Issuers
The GENIUS Act reshapes the stablecoin market with a set of uncompromising requirements:
stablecoins must be backed entirely by U.S. dollars or equally liquid assets, issuers with more than $50 billion in market value must undergo annual audits, and foreign-based issuers must follow strict operating rules within U.S. markets.
The Treasury Department, now coordinating interagency input, has already begun taking public comments on how the technical details should work.
Crypto Legislation Is Turning Into a Political Battleground
As the rulemaking begins, Congress is also trying to finalize a far broader digital-asset framework — the Clarity Act.
Negotiations around both bills have exposed deep partisan divisions, with Democrats repeatedly raising questions about President Donald Trump’s involvement in crypto ventures while simultaneously shaping policy that affects the sector.
Their concerns center around the World Liberty Financial project, a DeFi and stablecoin initiative listing Trump and his sons as co-founders. Lawmakers worry about the optics — and the implications — of a sitting president being tied to a business regulated by agencies under his authority.
Conflict-of-Interest Questions Hit Center Stage
The issue boiled over during Tuesday’s hearing. Rep. Maxine Waters (D-Calif.) asked agency heads whether federal law should prohibit a president from owning businesses that could benefit from his regulatory decisions, citing crypto and banking as examples.
Waters argued that without explicit boundaries, the system risks placing enormous financial power into the hands of someone who could “personally profit from their public work.”
Her comments underscored that the debate around crypto regulation is no longer purely about financial stability — it is now intertwined with questions about presidential ethics, political conflict, and control over the emerging digital-asset economy.
