WASHINGTON — A version of this story appeared in our The Guidance newsletter on June 23. Sign up here.
Seven weeks.
That’s how long Congress has to pass the “Genius Act” before the upcoming summer recess begins.
And President Donald Trump, a prominent advocate for cryptocurrency, is growing impatient.
Last week, the president directed House Republican members to swiftly approve the Senate-passed stablecoin legislation.
“Get it to my desk ASAP,” Trump posted on Truth Social. “No delays, no add-ons.”
The “Genius Act” establishes regulatory frameworks for issuers of dollar-backed stablecoins. The Senate recently fast-tracked its passage on this matter.
Crypto leaders have described the act as a “once-in-a-generation” development.
However, a complication exists: the House is concurrently considering its own measure, titled the “Stable Act.”
The path ahead remains uncertain.
Reconciliation Process
Will House members abandon their own legislation to simply adopt and pass the “Genius Act” before the August recess?
Alternatively, will House leaders continue with their bill and then negotiate a joint agreement with Senate colleagues via “reconciliation”?
If the latter course unfolds, lawmakers must bridge the significant differences between the two bills.
Regulatory Frameworks
Generally, the Senate bill is less restrictive than the House version.
Under the “Genius Act,” stablecoin issuers valued below $10 billion may opt for regulatory oversight by state officials, potentially less stringent than federal regulation.
Conversely, the House bill, the “Stable Act,” leans toward comprehensive federal oversight, requiring stablecoin issuers to adhere to banking-like regulations under the Bank Secrecy Act.
Diverging Priorities
Key distinctions also exist regarding algorithmic stablecoins.
The “Genius Act” permits algorithmic stablecoins unless Congress imposes a moratorium. The House bill explicitly prohibits them.
This prohibition reflects concerns stemming from the 2022 collapse of the algorithmically-pegged stablecoin, UST, which precipitated the downfall of the Terra Luna ecosystem.
The bottom line: Reaching consensus on a single bill within the remaining seven weeks is expected to be exceptionally challenging.
Observers will gain insight into House intentions in the coming days, particularly regarding whether lawmakers will embrace the Senate bill or proceed with their own legislative approach.
