Genius Act Passes, Paving Way for Stablecoin Regulation
Genius Act– Despite lacking a clear federal regulatory framework, stablecoins continue to expand rapidly. The recent passage of the GENIUS Act by the Senate could soon bring the regulatory clarity the sector has been waiting for.
According to recent data, stablecoins accounted for 28% of total cryptocurrency transaction volume in Q1 2025 alone. TRM Labs noted that leading stablecoins consistently made up at least 4% of the crypto market capitalization throughout 2024 and 2025. US dollar-pegged stablecoins dominate the market, representing over 90% of fiat-backed stablecoins in circulation.
Regions such as Latin America, sub-Saharan Africa, and Southeast Asia are seeing growing adoption as individuals and businesses use stablecoins to access US dollars and enable faster cross-border payments. These assets offer an alternative to traditional financial systems and provide increased liquidity.
Stablecoins’ Legal and Illicit Uses
TRM Labs reported that 99% of stablecoin transactions in 2024 were legitimate, supporting various use cases including payments, decentralized finance (DeFi), digital commerce, and remittances.
However, the platform also highlighted that stablecoins’ speed and liquidity make them attractive for illicit activities, accounting for 60% of illegal crypto transaction volume in Q1 2025. These activities include ransomware payments, terrorism financing, scams, sanctions evasion, OTC fraud, and money laundering.
While privacy coins like Monero gain attention, stablecoins remain the preferred choice for many malicious actors due to their stability and ease of use.
GENIUS Act Aims to Regulate Stablecoins
The GENIUS Act marks an important step toward addressing these challenges by creating a federal regulatory framework for stablecoins. The legislation focuses on consumer protection, market stability, and maintaining US leadership in digital finance. It includes measures designed to reduce the misuse of stablecoins for illegal purposes.
BeInCrypto reported that the bill passed the Senate with strong bipartisan support, signaling significant progress in establishing comprehensive stablecoin regulation.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.
