GENIUS Act

Key Points

• This policy creates the first major federal rules for "stablecoins," which are digital currencies designed to always be worth exactly one U.S. dollar. The goal is to make sure these digital assets are safe for regular people to use for payments and shopping without worrying about the value suddenly crashing.
• Companies that issue these digital dollars must now keep enough real cash or safe government bonds to back every single digital coin they sell on a 1-to-1 basis. They are required to prove they have this money by publishing monthly reports that are checked by independent accounting experts to ensure they aren't lying about their reserves.
• If a stablecoin company goes out of business, the law creates a clear plan to make sure the people holding the digital coins get their money back first. While these coins are still not officially insured by the government like a bank account, this rule provides a safety net for your money if the company fails.
• To prevent illegal activity, these companies must follow the same "know your customer" and anti-money laundering rules that traditional banks use. This is intended to stop terrorists, cartels, and hackers from using digital currencies to hide or move stolen money.
• The rules also ban companies from using confusing names that make their coins look like official government money. They are also prohibited from paying interest to people just for holding the coins. Most of these new requirements will start being enforced within the next 18 months.