Trump-Backed Stablecoin Bill Passes Senate Hurdle In Historic Moment For Crypto: Circle Stock In Focus

The U.S. Senate passed the Donald Trump-backed stablecoin bill on Tuesday, a significant victory for the crypto industry, which donated millions of dollars to the 2024 presidential election.

The so-called ‘Genius Act’ will regulate stablecoin digital assets, which are typically pegged at a 1:1 ratio with the U.S. dollar. Crypto users often utilize stablecoins to transfer funds between more volatile cryptocurrency assets.

In a rare show of bipartisan support, the bill passed on the Senate floor with a 68-30 vote as it moves to the House. Trump reportedly wants the bill to reach his desk before Congress begins recess in August.

The cryptocurrency industry bill had been in the works for years. Last year, it passed the House but did not get through the Senate, as the Democratic-controlled upper house chose not to discuss it.

Trump and his aides, including Treasury Secretary Scott Bessent, have backed the bill, saying it will increase demand for U.S. dollars and treasuries. The legislation mandates that stablecoin issuers hold dollar-for-dollar reserves of assets like short-term federal bonds and other similar financial instruments.

The crypto industry hopes that the legislation will ensure that stablecoins are accepted as a mainstream form of payment. Several retailers, such as Walmart and Amazon, are exploring the issuance of their stablecoins as they seek to reduce merchant fees.

The skeptical lawmakers in the Senate failed to amend the bill to include stricter consumer protections and address concerns around government bailouts of stablecoins. The bill will also allow large non-financial companies to enter the crypto markets.

The Senate also shunned Democratic efforts to bar Trump from profiting from his ever-growing crypto ventures. A Trump-linked memecoin is reportedly valued at over $2 billion already.

The bill will likely benefit Circle, the top issuer of stablecoins in the U.S., which was backing the legislation as it aims to gain market share from Tether, its overseas rival.

According to a Reuters report, Standard Chartered has estimated that the stablecoin market, currently valued at approximately $247 billion, could grow to $2 trillion by 2028 if relevant legislation is passed.

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