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What is the "Genius Act" and why you should care about it [1]
['This Content Is Not Subject To Review Daily Kos Staff Prior To Publication.']
Date: 2025-05-19
Stablecoins are a form of crypto currency that promises to be redeemable, dollar for dollar, on demand, just like a bank account. Sounds wonderful, doesn't it?
Unfortunately, they don’t have to follow any of the laws and regulations that govern real bank accounts regarding such minutiae, such as financial stability standards or consumer protections, not to mention, the lack of FDIC insurance in the event of a collapse. Some examples of ‘stablecoins’ include Facebook’s failed Libra Project, Tether, USDC and USD1– President Trump’s recently launched ‘stable coin’.
The GENIUS Act of 2025 (aka S.394), was introduced on February 4th by Bill Haggerty (R-TN) and co-sponsored by Republicans Tim Scott (SC), Cynthia Lumens (WY) with Democratic support provided by Kirsten Gillibrand (NY) and referred to the Committee on Banking, Housing, and Urban Affairs.
The scheme is supposed to work as follows:
Investors put a dollar into the stablecoin company, get a crypto “dollar” back that they can use for crypto trading (or money laundering or tax evasion) and get the (dubious) promise that they can trade back to their U.S. dollar at any time. In the meantime, the company that issues the stablecoin then invests the U.S. dollars into various assets and earns a return on those investments that they can keep as profit. ... The provisions in this bill would blow a hole through the United States’ traditional separation of banking and commerce. The Bank Holding Company Act, passed in 1956, prohibits bank holding companies from engaging in commercial activities and from controlling (or being controlled by) commercial enterprises. American Economic Liberties Project
So, in other words, you buy a stablecoin, you receive no interest (that would be a red line for the real banks) and have no recourse if the stablecoin becomes worthless, either by the issuer going under or deciding to get out of the business of issuing stablecoins, or they simply get hacked. Or, some other reason I can’t think of, off the top of my head.
On top of the simple financial issues above, If stablecoins are blessed by the Congress and the wannabe King, this will give big tech a huge leg up in surveilling their users financial lives, on top of the data we already give them about our personal lives.
The membership of the Committee on Banks, Housing and Urban Affairs is:
Majority Members (13) Minority Members (11) Scott, Tim (SC), Chairman
Crapo, Mike (ID)
Rounds, Mike (SD)
Tillis, Thom (NC)
Kennedy, John (LA)
Hagerty, Bill (TN)
Lummis, Cynthia M. (WY)
Britt, Katie Boyd (AL)
Ricketts, Pete (NE)
Banks, Jim (IN)
Cramer, Kevin (ND)
Moreno, Bernie (OH)
McCormick, David (PA) Warren, Elizabeth (MA), Ranking Member
Reed, Jack (RI)
Warner, Mark R. (VA)
Van Hollen, Chris (MD)
Cortez Masto, Catherine (NV)
Smith, Tina (MN)
Warnock, Raphael G. (GA)
Kim, Andy (NJ)
Gallego, Ruben (AZ)
Blunt Rochester, Lisa (DE)
Alsobrooks, Angela D. (MD)
And the Members of relevant subcommittee are:
Subcommittee on Digital Assets
Total Members: 11
Majority Members (6) Minority Members (5) Lummis, Cynthia M. (WY), Chairman
Tillis, Thom (NC)
Hagerty, Bill (TN)
Moreno, Bernie (OH)
McCormick, David (PA)
Scott, Tim (SC), Ex Officio Gallego, Ruben (AZ), Ranking Member
Warner, Mark R. (VA)
Van Hollen, Chris (MD)
Smith, Tina (MN)
Warren, Elizabeth (MA), Ex Officio
Please call your Senators if they are on the relevant committees and let them know you are opposed to latest scheme, and, if they are not on one of the committees, ask them to filibuster this money grab.
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