On June 17, Treasury Secretary Scott Bessent declared that a well-regulated stablecoin market could bolster demand for U.S. Treasuries, potentially lowering government borrowing costs and easing the national debt.
This remark comes as the Senate moves toward finalizing the GENIUS Act, a sweeping bipartisan bill to regulate the $250 billion stablecoin industry after months of contentious negotiations.
“A thriving stablecoin ecosystem will drive private-sector demand for U.S. Treasuries, which back stablecoins,” Bessent said in a statement. “This newfound demand could reduce government borrowing costs and help rein in the national debt.” Her comments signal the administration’s cautious embrace of crypto innovation while pushing for stronger oversight.
GENIUS Act: Regulatory Guidelines for Stablecoin
The GENIUS Act cleared the Senate Banking Committee in March with rare bipartisan support but faced fierce Democratic opposition after reports revealed that an Abu Dhabi-backed firm planned to use $2 billion in stablecoins, purchased from Trump-linked World Liberty Financial, to invest in Binance.
The revelation heightened concerns over former President Trump’s crypto dealings and spurred demands for stricter anti-corruption safeguards. By early May, Democrats had stalled the bill, forcing weeks of negotiations that led to key revisions, including:
- Mandatory disclosures for Congress and executive officials holding over $5,000 in stablecoins.
- Stronger bankruptcy protections for bank depositors.
- Treasury oversight rules to monitor suspicious transactions.
Despite these changes, progressive Democrats, led by Sen. Elizaeth Warren (D-MA), argue the bill remains dangerously weak. “This weak bill is worse than no bill at all,” Warren declared, urging colleagues to “show a little spine” and demand amendments. However, Senate Majority Leader John Thune (R-SD) limited amendment opportunities after a GOP proposal on credit card fees threatened to derail the legislation.
The bill has faced resistance from unlikely allies: Libertarian-leaning Sen. Rand Paul (R-KY) opposes federal crypto regulation entirely, while Sen. Josh Hawley (R-MO) warns it grants excessive power to Big Tech. Meanwhile, Sen. Kirsten Gillibrand (D-NY), a co-author, defended the framework as critical for ending the “Wild West” of crypto.
“Doing nothing is irresponsible,” Gillibrand said, acknowledging Trump’s involvement as “extremely unhelpful” but insisting the bill’s merits stand.
With procedural hurdles cleared, the Senate is poised to pass the GENIUS Act—a milestone in crypto regulation, even as critics warn of unfinished business. As Bessent’s remarks underscore, the stakes extend far beyond markets: They could reshape government finance itself.
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