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Democratic Lawmakers Change Stance
The GENIUS Act
Trump Family’s Involvement in Crypto Investments Intensifies Bipartisan Disagreement
According to reports, Senate Minority Leader Chuck Schumer privately urged Democratic colleagues not to support the bill temporarily during a closed-door meeting last Thursday, arguing that this would allow for more concessions from Republicans. Chuck Schumer expressed concerns regarding the handling of Tether and other offshore stablecoin companies in the bill.
Senator Elizabeth Warren, who has long been critical of cryptocurrencies, also voiced her concerns at the meeting, pointing out that given Trump’s and his family’s recent active involvement in the crypto business, which poses potential conflicts of interest, now is “not the right time” to pass the bill. Insiders revealed that this “tense” meeting was not initially focused on cryptocurrency issues, but the political controversies surrounding the crypto industry unexpectedly became the focal point.
In response to external doubts about the shift in stance, Arizona Democratic Senator Ruben Gallego clarified on X (formerly Twitter): “This is not a change of mind without reason.” He stated that the version of the bill submitted for Senate vote “represents a regression from several prior advancements and does not incorporate other improvements we proposed.”
Nevertheless, Ruben Gallego indicated that there is still an opportunity for both sides to renegotiate: “We will not be forced to accept this version. We look forward to continuing efforts to make the bill better.”
The bill, known as the GENIUS Act (Guiding and Establishing National Innovation for US Stablecoins), has garnered support from the cryptocurrency industry and is seen as a significant step towards regulatory clarity. The bill requires stablecoin issuers to adhere to the following regulations:
- 100% Reserve Support: Stablecoins must be fully backed by U.S. dollars and short-term U.S. Treasury securities (or other highly liquid assets).
- Monthly Public Reserve Information: To enhance transparency.
- Annual Audits: Issuers with a market capitalization exceeding $50 billion must undergo annual audits.
The Democrats are currently pushing to amend the draft to include additional national security, anti-money laundering (AML), and foreign issuer-related safeguards, as well as accountability measures for non-compliant actors.
Insiders have noted that Democrats are also concerned about the Trump family’s active presence in the cryptocurrency market. World Liberty Financial (WLFI), supported by the Trump family, has launched the dollar-pegged stablecoin USD1 and established a deep partnership with the world’s largest exchange, Binance. Democrats worry that this could lead to the bill being used as a political bargaining chip by Republicans, further undermining bipartisan consensus.
Despite this, lawmakers from both parties generally express hope to revise the bill’s content and restore the negotiation process in the coming weeks. However, as the November 2026 midterm elections approach, if bipartisan divisions continue to widen, the bill may struggle to complete the legislative process on time.
