Did the Stability Act for Stablecoins Die? Here’s What Happened!

It seemed like a sure thing. The US crypto industry, which has recently gained more political clout than ever before, was on the verge of finally getting that long-awaited “regulatory clarity” on stablecoins. Last week, however, the Senate failed in a crucial procedural vote on key legislation, the GENIUS Act. The question now is whether this bill should be considered functionally dead in legislative purgatory, or whether there is still hope for passage.

Is there still hope? That depends on who you ask. Technically, under Senate rules, the window to file a motion to reconsider the bill has already passed. Such a motion was supposed to be filed by Monday night, but no one filed it in time, a person familiar with Senate procedural rules confirmed.

Stablecoins are a vital part of the crypto economy. They are essentially digital dollar equivalents that allow users to trade in and out of digital assets and make payments or transfers abroad without having direct access to dollars. It's expected that once these assets are approved by the US Congress and the regulations are signed by the president, major banks and Wall Street giants will jump into the stablecoin market, bringing billions, if not trillions, of dollars into the crypto world. That's why the crypto industry lobby has pushed so hard for this legislation.

Still, the GENIUS Act did not go up for a cloture vote this week, as the political landscape surrounding the issue has not changed since Thursday. A small group of pro-crypto Democrats have yet to reach an agreement with Republican leaders on the language in the bill. Republicans, however, are confident that they can use “other procedural avenues” to get the GENIUS Act back on the agenda if a deal is struck.

After a relatively quiet weekend, key Democratic and Republican stakeholders are resuming discussions this week on the bill’s content. Both sides, however, remain highly cagey about what specific language will impede progress. Five Democratic senators who voted against the bill last week had previously advised in favor of it in the Senate Banking Committee. Two of the Democrats who voted against the bill on Thursday, Kirsten Gillibrand (D-NY) and Angela Alsobrooks (D-MD), are actually co-sponsors of the legislation.

In a statement issued over the weekend, pro-crypto Democrats blamed their change of support for the GENIUS Act on sections of a new draft of the bill that they said did not adequately address anti-money laundering and national security needs. But political currency also appears to have played a significant role in their about-face. In recent weeks, President Trump and his family have made several notable announcements regarding crypto and stablecoins, which has raised concerns among Democrats about alleged conflicts of interest in the White House.

This political dynamic was recently exacerbated when Trump announced on Monday that he plans to personally accept a $400 million Boeing jet as a gift from the Qatari government. Multiple crypto policy leaders have expressed concern this week that the political risks pose a serious threat not only to the chance to save the GENIUS Act, but also to the sector’s broader legislative agenda. A parallel stablecoin bill is currently moving through the House, while major legislation on market structure is also pending in both chambers of Congress.

Policymakers agree: This week is crucial for crypto’s political momentum in Washington. If the GENIUS Act doesn’t make significant progress by Friday—that means passing the cloture vote that failed last week—the situation could become irreparable.

“Things are going to get bleak if something doesn't change soon,” was the assessment of one DC insider

Frequently Asked Questions

Why is the GENIUS Act so important for the crypto industry?
The GENIUS Act aims to establish a legal framework for offering stablecoins in the United States. This could lead to greater legitimacy and participation of traditional financial institutions in the crypto market.

What are the main obstacles to the passage of the GENIUS Act?
The main obstacles are disagreements over the wording of the bill, especially in the areas of anti-money laundering measures and national security. Political dynamics and potential conflicts of interest also play a role.

What happens if the GENIUS Act doesn't pass this week?
If the GENIUS Act doesn’t make significant progress this week, it could spell the end for stablecoin legislation and the broader political outlook for the crypto industry in Washington.