Introduction
In a significant development, crypto journalist Eleanor Terrett reports that the U.S. Senate has received a recently updated bipartisan amendment draft concerning the GENIUS Act.
Key Amendments
This new iteration introduces enhanced regulatory frameworks specifically aimed at stablecoin issuers, with clear prohibitions against misleading claims of Federal Deposit Insurance Corporation (FDIC) approval or U.S. government endorsement. Additionally, the amendment restricts stablecoin issuers from incorporating terms such as “United States” or “U.S. government” in their branding, an effort designed to mitigate consumer misunderstanding about the nature of these digital currencies.
Regulations for Technology Firms
Another pivotal aspect of this amendment is the introduction of stringent regulations for major technology firms. Companies that are not primarily financial institutions—such as Meta, Amazon, Google, and Microsoft—are now barred from launching stablecoins unless they adhere to rigorous standards concerning financial risk, consumer data protection, and equitable business practices. This regulatory approach aligns with the former President Donald Trump’s “America First” principle, which emphasizes the need to delineate the banking sector from the dominant influence of Silicon Valley tech giants.
Enforcement and Oversight
Moreover, the amendment bolsters enforcement capabilities by granting the Treasury Department the authority to suspend an issuer’s registration in instances of reckless or intentional wrongdoing. It also aims to broaden the ethical oversight for special government employees, including high-profile figures like Elon Musk, ensuring consistent enforcement of regulations regarding financial conflicts of interest.
Overall, these revisions serve to curtail the financial reach of major tech enterprises while imposing additional procedural hurdles.
