The GENIUS Act: the US stablecoin law, explained

On July 18, 2025, the United States enacted the GENIUS Act. Stablecoins were not previously outside all regulation, but this law gives payment stablecoins a specific federal framework. Read the change at two levels: the obligations and their effective date.

What is the GENIUS Act, in one sentence?

The GENIUS Act is the first United States federal law that sets binding rules for payment stablecoins, digital coins pegged one-to-one to a currency like the dollar. President Trump signed it on July 18, 2025, after it passed with rare bipartisan margins: 68 to 30 in the Senate, 308 to 122 in the House. The name is an acronym for Guiding and Establishing National Innovation for U.S. Stablecoins. The plain version: a coin marketed to the public as a digital dollar now has a rulebook it must follow, and regulators who can enforce it.

What does the law actually require?

The core of the act is short and strict. An issuer of a regulated payment stablecoin must meet five tests.

• Full backing, one to one. Every coin in circulation must be matched by at least an equal value of safe, liquid assets, like dollars, short-dated Treasury bills, or government money funds. The reserves cannot be lent out or reused.
• Monthly proof. Issuers must publish the composition of those reserves every month, so anyone can check the backing is really there.
• No interest to holders. An issuer cannot pay you any yield or interest for holding its coin. This one line shapes the whole market, and we come back to it below.
• Rules against dirty money. Issuers fall under the Bank Secrecy Act, must run anti-money-laundering and sanctions checks, and must be able to freeze or burn coins when a court lawfully orders it.
• Priority claims in insolvency. The law provides holder priority over required reserves and provisions for certain shortfalls. Legal priority does not guarantee immediate, full recovery.

Who is allowed to issue a stablecoin?

Not just anyone. The law opens three lanes: a subsidiary of an insured bank, a federal nonbank issuer approved by the Office of the Comptroller of the Currency (the national bank regulator, the OCC), or an issuer licensed under a state regime. The size of the issuer decides who watches it. A state-licensed issuer can stay under state supervision only while its coins in circulation total less than 10 billion dollars. Past that line it has to move to federal oversight within 360 days, or win a waiver. The effect is deliberate: the largest issuers answer to Washington, while smaller ones can start under their home state.

Why does the “no interest” rule matter?

The prohibition on issuer-paid interest simply for holding a stablecoin draws a line between a payment instrument and balance remuneration. It does not make every product involving the token identical: a separately offered investment requires its own analysis.

Our reading is that this boundary will influence competition between payment and savings products. Its actual effect depends on available offers and applicable rules. It does not establish automatic protection for every individual or a guaranteed advantage for every bank.

When do the rules take effect?

Section 20 sets effectiveness at the earlier of eighteen months after enactment or 120 days after the specified final regulations. January 18, 2027 is therefore the outer date in that formula. A proposed rule open for comment should not be described as a final regulation.

What does it mean if you just use a dollar coin?

The law provides reserve and disclosure requirements and priority treatment for holder claims in insolvency under its provisions. It does not guarantee a constant market price or immediate recovery in every situation. Assessing a token still requires identifying its issuer, status and applicable rules.

A law governing a stablecoin issuer does not by itself describe the rights and conditions of every application using that token. Integrated payments are disabled in Spliz. Their return remains in preparation, with no asset or network announced.

The one-line version

The change lies in obligations and remedies as much as announcements. That is where a digital dollar promise can be examined.

A stablecoin used to be a promise. The GENIUS Act turns it into a regulated one.

Sources

• The White House, fact sheet on the GENIUS Act’s reserve, disclosure and anti-money-laundering requirements (July 2025).
• Congress.gov, the text of S.1582 (GENIUS Act) and its enactment record.
• Paul Hastings LLP, section-level guide to issuer categories, the 10 billion dollar threshold, the no-yield rule and the effective-date timeline.
• Federal Register, the OCC’s proposed rule implementing the GENIUS Act (March 2, 2026).
• OCC Bulletin 2026-28, proposed anti-money-laundering and sanctions rule for stablecoin issuers (June 22, 2026).
• Treasury, Federal Register, proposed rule on stablecoin issuance, offer and sale, comments until October 19, 2026 (August 18, 2026).