Congressional Record, Volume 171 Issue 123 (Thursday, July 17, 2025)

[Congressional Record Volume 171, Number 123 (Thursday, July 17, 2025)]
[House]
[Pages H3405-H3427]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

GUIDING AND ESTABLISHING NATIONAL INNOVATION FOR U.S. STABLECOINS ACT

Mr. HILL of Arkansas. Mr. Speaker, pursuant to House Resolution 580,
I call up the bill (S. 1582) to provide for the regulation of payment
stablecoins, and for other purposes, and ask for its immediate
consideration in the House.
The Clerk read the title of the bill.
The SPEAKER pro tempore. Pursuant to House Resolution 580, the bill
is considered read.
The text of the bill is as follows:

S. 1582

Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Guiding and Establishing
National Innovation for U.S. Stablecoins Act'' or the
``GENIUS Act''.

SEC. 2. DEFINITIONS.

In this Act:
(1) Appropriate federal banking agency.--The term
``appropriate Federal banking agency'' has the meaning given
that term in section 3 of the Federal Deposit Insurance Act
(12 U.S.C. 1813).
(2) Bank secrecy act.--The term ``Bank Secrecy Act''
means--
(A) section 21 of the Federal Deposit Insurance Act (12
U.S.C. 1829b);
(B) chapter 2 of title I of Public Law 91-508 (12 U.S.C.
1951 et seq.); and
(C) subchapter II of chapter 53 of title 31, United States
Code.
(3) Board.--The term ``Board'' means the Board of Governors
of the Federal Reserve System.
(4) Comptroller.--The term ``Comptroller'' means the Office
of the Comptroller of the Currency.
(5) Corporation.--The term ``Corporation'' means the
Federal Deposit Insurance Corporation.
(6) Digital asset.--The term ``digital asset'' means any
digital representation of value that is recorded on a
cryptographically secured distributed ledger.
(7) Digital asset service provider.--The term ``digital
asset service provider''--
(A) means a person that, for compensation or profit,
engages in the business in the United States (including on
behalf of customers or users in the United States) of--
(i) exchanging digital assets for monetary value;
(ii) exchanging digital assets for other digital assets;
(iii) transferring digital assets to a third party;
(iv) acting as a digital asset custodian; or
(v) participating in financial services relating to digital
asset issuance; and
(B) does not include--
(i) a distributed ledger protocol;
(ii) developing, operating, or engaging in the business of
developing distributed ledger protocols or self-custodial
software interfaces;
(iii) an immutable and self-custodial software interface;
(iv) developing, operating, or engaging in the business of
validating transactions or operating a distributed ledger; or
(v) participating in a liquidity pool or other similar
mechanism for the provisioning of liquidity for peer-to-peer
transactions.
(8) Distributed ledger.--The term ``distributed ledger''
means technology in which data is shared across a network
that creates a public digital ledger of verified transactions
or information among network participants and cryptography is
used to link the data to maintain the integrity of the public
ledger and execute other functions.
(9) Distributed ledger protocol.--The term ``distributed
ledger protocol'' means publicly available and accessible
executable software deployed to a distributed ledger,
including smart contracts or networks of smart contracts.
(10) Federal branch.--The term ``Federal branch'' has the
meaning given that term in section 3 of the Federal Deposit
Insurance Act (12 U.S.C. 1813).
(11) Federal qualified payment stablecoin issuer.--The term
``Federal qualified payment stablecoin issuer'' means--
(A) a nonbank entity, other than a State qualified payment
stablecoin issuer, approved by the Comptroller, pursuant to
section 5, to issue payment stablecoins;
(B) an uninsured national bank--
(i) that is chartered by the Comptroller, pursuant to title
LXII of the Revised Statutes; and
(ii) that is approved by the Comptroller, pursuant to
section 5, to issue payment stablecoins; and
(C) a Federal branch that is approved by the Comptroller,
pursuant to section 5, to issue payment stablecoins.
(12) Foreign payment stablecoin issuer.--The term ``foreign
payment stablecoin issuer'' means an issuer of a payment
stablecoin that is--
(A) organized under the laws of or domiciled in a foreign
country, a territory of the United States, Puerto Rico, Guam,
American Samoa, or the Virgin Islands; and
(B) not a permitted payment stablecoin issuer.
(13) Institution-affiliated party.--With respect to a
permitted payment stablecoin issuer, the term ``institution-
affiliated party'' means any director, officer, employee, or
controlling stockholder of the permitted payment stablecoin
issuer.
(14) Insured credit union.--The term ``insured credit
union'' has the meaning given that term in section 101 of the
Federal Credit Union Act (12 U.S.C. 1752).
(15) Insured depository institution.--The term ``insured
depository institution'' means--
(A) an insured depository institution, as defined in
section 3 of the Federal Deposit Insurance Act (12 U.S.C.
1813); and
(B) an insured credit union.
(16) Lawful order.--The term ``lawful order'' means any
final and valid writ, process, order, rule, decree, command,
or other requirement issued or promulgated under Federal law,
issued by a court of competent jurisdiction or by an
authorized Federal agency pursuant to its statutory
authority, that--
(A) requires a person to seize, freeze, burn, or prevent
the transfer of payment stablecoins issued by the person;
(B) specifies the payment stablecoins or accounts subject
to blocking with reasonable particularity; and
(C) is subject to judicial or administrative review or
appeal as provided by law.
(17) Monetary value.--The term ``monetary value'' means a
national currency or deposit (as defined in section 3 of the
Federal Deposit Insurance Act (12 U.S.C. 1813)) denominated
in a national currency.

[[Page H3406]]

(18) Money.--The term ``money''--
(A) means a medium of exchange currently authorized or
adopted by a domestic or foreign government; and
(B) includes a monetary unit of account established by an
intergovernmental organization or by agreement between 2 or
more countries.
(19) National currency.--The term ``national currency''
means each of the following:
(A) A Federal Reserve note (as the term is used in the
first undesignated paragraph of section 16 of the Federal
Reserve Act (12 U.S.C. 411)).
(B) Money standing to the credit of an account with a
Federal Reserve Bank.
(C) Money issued by a foreign central bank.
(D) Money issued by an intergovernmental organization
pursuant to an agreement by 2 or more governments.
(20) Nonbank entity.--The term ``nonbank entity'' means a
person that is not a depository institution or subsidiary of
a depository institution.
(21) Offer.--The term ``offer'' means to make available for
purchase, sale, or exchange.
(22) Payment stablecoin.--The term ``payment stablecoin''--
(A) means a digital asset--
(i) that is, or is designed to be, used as a means of
payment or settlement; and
(ii) the issuer of which--

(I) is obligated to convert, redeem, or repurchase for a
fixed amount of monetary value, not including a digital asset
denominated in a fixed amount of monetary value; and
(II) represents that such issuer will maintain, or create
the reasonable expectation that it will maintain, a stable
value relative to the value of a fixed amount of monetary
value; and

(B) does not include a digital asset that--
(i) is a national currency;
(ii) is a deposit (as defined in section 3 of the Federal
Deposit Insurance Act (12 U.S.C. 1813)), including a deposit
recorded using distributed ledger technology; or
(iii) is a security, as defined in section 2 of the
Securities Act of 1933 (15 U.S.C. 77b), section 3 of the
Securities Exchange Act of 1934 (15 U.S.C. 78c), or section 2
of the Investment Company Act of 1940 (15 U.S.C. 80a-2),
except that, for the avoidance of doubt, no bond, note,
evidence of indebtedness, or investment contract that was
issued by a permitted payment stablecoin issuer shall qualify
as a security solely by virtue of its satisfying the
conditions described in subparagraph (A), consistent with
section 17 of this Act.
(23) Permitted payment stablecoin issuer.--The term
``permitted payment stablecoin issuer'' means a person formed
in the United States that is--
(A) a subsidiary of an insured depository institution that
has been approved to issue payment stablecoins under section
5;
(B) a Federal qualified payment stablecoin issuer; or
(C) a State qualified payment stablecoin issuer.
(24) Person.--The term ``person'' means an individual,
partnership, company, corporation, association, trust,
estate, cooperative organization, or other business entity,
incorporated or unincorporated.
(25) Primary federal payment stablecoin regulator.--The
term ``primary Federal payment stablecoin regulator'' means--
(A) with respect to a subsidiary of an insured depository
institution (other than an insured credit union), the
appropriate Federal banking agency of such insured depository
institution;
(B) with respect to an insured credit union or a subsidiary
of an insured credit union, the National Credit Union
Administration;
(C) with respect to a State chartered depository
institution not specified under subparagraph (A), the
Corporation, the Comptroller, or the Board; and
(D) with respect to a Federal qualified payment stablecoin
issuer, the Comptroller.
(26) Registered public accounting firm.--The term
``registered public accounting firm'' has the meaning given
that term under section 2 of the Sarbanes-Oxley Act of 2002
(15 U.S.C. 7201).
(27) Stablecoin certification review committee.--The term
``Stablecoin Certification Review Committee'' means the
committee of that name and having the functions as provided
in this Act--
(A) of which--
(i) the Secretary of the Treasury shall serve as Chair; and
(ii) the Chair of the Board (or the Vice Chair for
Supervision, as delegated by the Chair of the Board), and the
Chair of the Corporation shall serve as members; and
(B) which, unless otherwise specified in this Act, shall
act by \2/3\ vote of its members at any meeting called by the
Chair or by unanimous written consent.
(28) State.--The term ``State'' means each of the several
States of the United States, the District of Columbia, and
each territory of the United States.
(29) State chartered depository institution.--The term
``State chartered depository institution'' has the meaning
given the term ``State depository institution'' in section
3(c) of the Federal Deposit Insurance Act (12 U.S.C.
1813(c)).
(30) State payment stablecoin regulator.--The term ``State
payment stablecoin regulator'' means a State agency that has
primary regulatory and supervisory authority in such State
over entities that issue payment stablecoins.
(31) State qualified payment stablecoin issuer.--The term
``State qualified payment stablecoin issuer'' means an entity
that--
(A) is legally established under the laws of a State and
approved to issue payment stablecoins by a State payment
stablecoin regulator; and
(B) is not an uninsured national bank chartered by the
Comptroller pursuant to title LXII of the Revised Statutes, a
Federal branch, an insured depository institution, or a
subsidiary of such national bank, Federal branch, or insured
depository institution.
(32) Subsidiary.--The term ``subsidiary'' has the meaning
given that term in section 3 of the Federal Deposit Insurance
Act (12 U.S.C. 1813).
(33) Subsidiary of an insured credit union.--With respect
to an insured credit union, the term ``subsidiary of an
insured credit union'' means--
(A) an organization providing services to the insured
credit union that are associated with the routine operations
of credit unions, as described in section 107(7)(I) of the
Federal Credit Union Act (12 U.S.C. 1757(7)(I));
(B) a credit union service organization, as such term is
used under part 712 of title 12, Code of Federal Regulations,
with respect to which the insured credit union has an
ownership interest or to which the insured credit union has
extended a loan; and
(C) a subsidiary of a State chartered insured credit union
authorized under State law.

SEC. 3. ISSUANCE AND TREATMENT OF PAYMENT STABLECOINS.

(a) Limitation on Issuers.--It shall be unlawful for any
person other than a permitted payment stablecoin issuer to
issue a payment stablecoin in the United States.
(b) Prohibition on Offers or Sales.--
(1) In general.--Except as provided in subsection (c) and
section 18, beginning on the date that is 3 years after the
date of enactment of this Act, it shall be unlawful for a
digital asset service provider to offer or sell a payment
stablecoin to a person in the United States, unless the
payment stablecoin is issued by a permitted payment
stablecoin issuer.
(2) Foreign payment stablecoin issuers.--It shall be
unlawful for any digital asset service provider to offer,
sell, or otherwise make available in the United States a
payment stablecoin issued by a foreign payment stablecoin
issuer unless the foreign payment stablecoin issuer has the
technological capability to comply, and will comply, with the
terms of any lawful order and any reciprocal arrangement
pursuant to section 18.
(c) Limited Safe Harbors.--
(1) In general.--The Secretary of the Treasury may issue
regulations providing safe harbors from subsection (a) that
are--
(A) consistent with the purposes of the Act;
(B) limited in scope; and
(C) apply to a de minimis volume of transactions, as
determined by the Secretary of the Treasury.
(2) Unusual and exigent circumstances.--
(A) In general.--If the Secretary of the Treasury
determines that unusual and exigent circumstances exist, the
Secretary may provide limited safe harbors from subsection
(a).
(B) Justification.--Prior to issuing a limited safe harbor
under this paragraph, the Secretary of the Treasury shall
submit to the chairs and ranking members of the Committee on
Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of
Representatives a justification for the determination of the
unusual and exigent circumstances, which may be contained in
a classified annex, as applicable.
(d) Rulemaking.--Consistent with section 13, the Secretary
of the Treasury shall issue regulations to implement this
section, including regulations to define terms.
(e) Extraterritorial Effect.--This section is intended to
have extraterritorial effect if conduct involves the offer or
sale of a payment stablecoin to a person located in the
United States.
(f) Penalty for Violation.--
(1) In general.--Whoever knowingly participates in a
violation of subsection (a) shall be fined not more than
$1,000,000 for each such violation, imprisoned for not more
than 5 years, or both.
(2) Referral to attorney general.--If a primary Federal
payment stablecoin regulator has reason to believe that any
person has knowingly violated subsection (a), the primary
Federal payment stablecoin regulator may refer the matter to
the Attorney General.
(g) Treatment.--A payment stablecoin that is not issued by
a permitted payment stablecoin issuer shall not be--
(1) treated as cash or as a cash equivalent for accounting
purposes;
(2) eligible as cash or as a cash equivalent margin and
collateral for futures commission merchants, derivative
clearing organizations, broker-dealers, registered clearing
agencies, and swap dealers; or
(3) acceptable as a settlement asset to facilitate
wholesale payments between banking organizations or by a
payment infrastructure to facilitate exchange and settlement
among banking organizations.
(h) Rules of Construction.--
(1) Exempt transactions.--This section shall not apply to--

[[Page H3407]]

(A) the direct transfer of digital assets between 2
individuals acting on their own behalf and for their own
lawful purposes, without the involvement of an intermediary;
(B) to any transaction involving the receipt of digital
assets by an individual between an account owned by the
individual in the United States and an account owned by the
individual abroad that are offered by the same parent
company; or
(C) to any transaction by means of a software or hardware
wallet that facilitates an individual's own custody of
digital assets.
(2) Treasury authority.--Nothing in this Act shall alter
the existing authority of the Secretary of the Treasury to
block, restrict, or limit transactions involving payment
stablecoins that reference or are denominated in United
States dollars that are subject to the jurisdiction of the
United States.

SEC. 4. REQUIREMENTS FOR ISSUING PAYMENT STABLECOINS.

(a) Standards for the Issuance of Payment Stablecoins.--
(1) In general.--A permitted payment stablecoin issuer
shall--
(A) maintain identifiable reserves backing the outstanding
payment stablecoins of the permitted payment stablecoin
issuer on an at least 1 to 1 basis, with reserves
comprising--
(i) United States coins and currency (including Federal
Reserve notes) or money standing to the credit of an account
with a Federal Reserve Bank;
(ii) funds held as demand deposits (or other deposits that
may be withdrawn upon request at any time) or insured shares
at an insured depository institution (including any foreign
branches or agents, including correspondent banks, of an
insured depository institution), subject to limitations
established by the Corporation and the National Credit Union
Administration, as applicable, to address safety and
soundness risks of such insured depository institution;
(iii) Treasury bills, notes, or bonds--

(I) with a remaining maturity of 93 days or less; or
(II) issued with a maturity of 93 days or less;

(iv) money received under repurchase agreements, with the
permitted payment stablecoin issuer acting as a seller of
securities and with an overnight maturity, that are backed by
Treasury bills with a maturity of 93 days or less;
(v) reverse repurchase agreements, with the permitted
payment stablecoin issuer acting as a purchaser of securities
and with an overnight maturity, that are collateralized by
Treasury notes, bills, or bonds on an overnight basis,
subject to overcollateralization in line with standard market
terms, that are--

(I) tri-party;
(II) centrally cleared through a clearing agency registered
with the Securities and Exchange Commission; or
(III) bilateral with a counterparty that the issuer has
determined to be adequately creditworthy even in the event of
severe market stress;

(vi) securities issued by an investment company registered
under section 8(a) of the Investment Company Act of 1940 (15
U.S.C. 80a-8(a)), or other registered Government money market
fund, and that are invested solely in underlying assets
described in clauses (i) through (v);
(vii) any other similarly liquid Federal Government-issued
asset approved by the primary Federal payment stablecoin
regulator, in consultation with the State payment stablecoin
regulator, if applicable, of the permitted payment stablecoin
issuer; or
(viii) any reserve described in clause (i) through (iii) or
clause (vi) through (vii) in tokenized form, provided that
such reserves comply with all applicable laws and
regulations;
(B) publicly disclose the issuer's redemption policy, which
shall--
(i) establish clear and conspicuous procedures for timely
redemption of outstanding payment stablecoins, provided that
any discretionary limitations on timely redemptions can only
be imposed by a State qualified payment stablecoin regulator,
the Corporation, the Comptroller, or the Board, consistent
with section 7; and
(ii) publicly, clearly, and conspicuously disclose in plain
language all fees associated with purchasing or redeeming the
payment stablecoins, provided that such fees can only be
changed upon not less than 7 days' prior notice to consumers;
and
(C) publish the monthly composition of the issuer's
reserves on the website of the issuer, containing--
(i) the total number of outstanding payment stablecoins
issued by the issuer; and
(ii) the amount and composition of the reserves described
in subparagraph (A), including the average tenor and
geographic location of custody of each category of reserve
instruments.
(2) Prohibition on rehypothecation.--Reserves required
under paragraph (1)(A) may not be pledged, rehypothecated, or
reused by the permitted payment stablecoin issuer, either
directly or indirectly, except for the purpose of--
(A) satisfying margin obligations in connection with
investments in permitted reserves under clauses (iv) and (v)
of paragraph (1)(A);
(B) satisfying obligations associated with the use,
receipt, or provision of standard custodial services; or
(C) creating liquidity to meet reasonable expectations of
requests to redeem payment stablecoins, such that reserves in
the form of Treasury bills may be sold as purchased
securities for repurchase agreements with a maturity of 93
days or less, provided that either--
(i) the repurchase agreements are cleared by a clearing
agency registered with the Securities and Exchange
Commission; or
(ii) the permitted payment stablecoin issuer receives the
prior approval of its primary Federal payment stablecoin
regulator or State payment stablecoin regulator, as
applicable.
(3) Monthly certification; examination of reports by
registered public accounting firm.--
(A) In general.--A permitted payment stablecoin issuer
shall, each month, have the information disclosed in the
previous month-end report required under paragraph (1)(D)
examined by a registered public accounting firm.
(B) Certification.--Each month, the Chief Executive Officer
and Chief Financial Officer of a permitted payment stablecoin
issuer shall submit a certification as to the accuracy of the
monthly report to, as applicable--
(i) the primary Federal payment stablecoin regulator of the
permitted payment stablecoin issuer; or
(ii) the State payment stablecoin regulator of the
permitted payment stablecoin issuer.
(C) Criminal penalty.--Any person who submits a
certification required under subparagraph (B) knowing that
such certification is false shall be subject to the same
criminal penalties as those set forth under section 1350(c)
of title 18, United States Code.
(4) Capital, liquidity, and risk management requirements.--
(A) In general.--The primary Federal payment stablecoin
regulators shall, or in the case of a State qualified payment
stablecoin issuer, the State payment stablecoin regulator
shall, consistent with section 13, issue regulations
implementing--
(i) capital requirements applicable to permitted payment
stablecoin issuers that--

(I) are tailored to the business model and risk profile of
permitted payment stablecoin issuers;
(II) do not exceed requirements that are sufficient to
ensure the ongoing operations of permitted payment stablecoin
issuers; and
(III) in the case of the primary Federal payment stablecoin
regulators, if the primary Federal payment stablecoin
regulators determine that a capital buffer is necessary to
ensure the ongoing operations of permitted payment stablecoin
issuers, may include capital buffers that are tailored to the
business model and risk profile of permitted payment
stablecoin issuers;

(ii) the liquidity standard under paragraph (1)(A);
(iii) reserve asset diversification, including deposit
concentration at banking institutions, and interest rate risk
management standards applicable to permitted payment
stablecoin issuers that--

(I) are tailored to the business model and risk profile of
permitted payment stablecoin issuers; and
(II) do not exceed standards that are sufficient to ensure
the ongoing operations of permitted payment stablecoin
issuers; and

(iv) appropriate operational, compliance, and information
technology risk management principles-based requirements and
standards, including Bank Secrecy Act and sanctions
compliance standards, that--

(I) are tailored to the business model and risk profile of
permitted payment stablecoin issuers; and
(II) are consistent with applicable law.

(B) Rule of construction.--Nothing in this paragraph shall
be construed to limit--
(i) the authority of the primary Federal payment stablecoin
regulators, in prescribing standards under this paragraph, to
tailor or differentiate among issuers on an individual basis
or by category, taking into consideration the capital
structure, business model risk profile, complexity, financial
activities (including financial activities of subsidiaries),
size, and any other risk-related factors of permitted payment
stablecoin issuers that a primary Federal payment stablecoin
regulator determines appropriate, provided that such
tailoring or differentiation occurs without respect to
whether a permitted payment stablecoin issuer is regulated by
a State payment stablecoin regulator; or
(ii) any supervisory, regulatory, or enforcement authority
of a primary Federal payment stablecoin regulator to further
the safe and sound operation of an institution for which the
primary Federal payment stablecoin regulator is the
appropriate regulator.
(C) Applicability of existing capital standards.--
(i) Definition.--In this subparagraph, the term
``depository institution holding company'' has the meaning
given that term under section 171(a)(3) of the Financial
Stability Act of 2010 (12 U.S.C. 5371(a)(3)).
(ii) Applicability of financial stability act.--With
respect to the promulgation of rules under subparagraph (A)
and clauses (iii) and (iv) of this subparagraph, section 171
of the Financial Stability Act of 2010 (12 U.S.C. 5371) shall
not apply.
(iii) Rules relating to leverage capital requirements or
risk-based capital requirements.--Any rule issued by an
appropriate Federal banking agency that imposes, on a
consolidated basis, a leverage capital requirement or risk-
based capital requirement with respect to an insured
depository

[[Page H3408]]

institution or depository institution holding company shall
provide that, for purposes of such leverage capital
requirement or risk-based capital requirement, any insured
depository institution or depository institution holding
company that includes, on a consolidated basis, a permitted
payment stablecoin issuer, shall not be required to hold,
with respect to such permitted payment stablecoin issuer and
its assets and operations, any amount of regulatory capital
in excess of the capital that such permitted payment
stablecoin issuer must maintain under the capital
requirements issued pursuant to subparagraph (A)(i).
(iv) Modifications.--Not later than the earlier of the
rulemaking deadline under section 13 or the date on which the
Federal payment stablecoin regulators issue regulations to
carry out this section, each appropriate Federal banking
agency shall amend or otherwise modify any regulation of the
appropriate Federal banking agency described in clause (iii)
so that such regulation, as amended or otherwise modified,
complies with clause (iii) of this subparagraph.
(5) Treatment under the bank secrecy act and sanctions
laws.--
(A) In general.--A permitted payment stablecoin issuer
shall be treated as a financial institution for purposes of
the Bank Secrecy Act, and as such, shall be subject to all
Federal laws applicable to a financial institution located in
the United States relating to economic sanctions, prevention
of money laundering, customer identification, and due
diligence, including--
(i) maintenance of an effective anti-money laundering
program, which shall include appropriate risk assessments and
designation of an officer to supervise the program;
(ii) retention of appropriate records;
(iii) monitoring and reporting of any suspicious
transaction relevant to a possible violation of law or
regulation;
(iv) technical capabilities, policies, and procedures to
block, freeze, and reject specific or impermissible
transactions that violate Federal or State laws, rules, or
regulations;
(v) maintenance of an effective customer identification
program, including identification and verification of account
holders with the permitted payment stablecoin issuer, high-
value transactions, and appropriate enhanced due diligence;
and
(vi) maintenance of an effective economic sanctions
compliance program, including verification of sanctions
lists, consistent with Federal law.
(B) Rulemaking.--The Secretary of the Treasury shall adopt
rules, tailored to the size and complexity of permitted
payment stablecoin issuers, to implement subparagraph (A).
(C) Reservation of authority.--Nothing in this Act shall
restrict the authority of the Secretary of the Treasury to
implement, administer, and enforce the provisions of
subchapter II of chapter 53 of title 31, United States Code.
(6) Coordination with permitted payment stablecoin issuers
with respect to blocking of property and technological
capabilities to comply with lawful orders.--
(A) In general.--The Secretary of the Treasury--
(i) shall, to the best of the Secretary's ability,
coordinate with a permitted payment stablecoin issuer before
taking any action to block and prohibit transactions in
property and interests in property of a foreign person to
ensure that the permitted payment stablecoin issuer is able
to effectively block a payment stablecoin of the foreign
person upon issuance of the payment stablecoin; and
(ii) is not required to notify any permitted payment
stablecoin issuer of any intended action described in clause
(i) prior to taking such action.
(B) Compliance with lawful orders.--A permitted payment
stablecoin issuer may issue payment stablecoins only if the
issuer has the technological capability to comply, and will
comply, with the terms of any lawful order.
(C) Report required.--Not later than 1 year after the date
of enactment of this Act, the Attorney General and the
Secretary of the Treasury shall submit to the Committee on
Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of
Representatives a report, which may include a classified
annex if applicable, on the coordination with permitted
payment stablecoin issuers required under subparagraph (A).
(D) Rule of construction.--Nothing in this paragraph shall
be construed to alter or affect the authority of State
payment stablecoin regulators with respect to the offer of
foreign-issued digital assets that are issued within a
foreign jurisdiction.
(7) Limitation on payment stablecoin activities.--
(A) In general.--A permitted payment stablecoin issuer may
only--
(i) issue payment stablecoins;
(ii) redeem payment stablecoins;
(iii) manage related reserves, including purchasing,
selling, and holding reserve assets or providing custodial
services for reserve assets, consistent with State and
Federal law;
(iv) provide custodial or safekeeping services for payment
stablecoins, required reserves, or private keys of payment
stablecoins, consistent with this Act; and
(v) undertake other activities that directly support any of
the activities described in clauses (i) through (iv).
(B) Rule of construction.--Nothing in subparagraph (A)
shall limit a permitted payment stablecoin issuer from
engaging in payment stablecoin activities or digital asset
service provider activities specified by this Act, and
activities incidental thereto, that are authorized by the
primary Federal payment stablecoin regulator or the State
payment stablecoin regulator, as applicable, consistent with
all other Federal and State laws, provided that the claims of
payment stablecoin holders rank senior to any potential
claims of non-stablecoin creditors with respect to the
reserve assets, consistent with section 11.
(8) Prohibition on tying.--
(A) In general.--A permitted payment stablecoin issuer may
not provide services to a customer on the condition that the
customer obtain an additional paid product or service from
the permitted payment stablecoin issuer, or any of its
subsidiaries, or agree to not obtain an additional product or
service from a competitor.
(B) Regulations.--The Board may issue such regulations as
are necessary to carry out this paragraph, and, in
consultation with other relevant primary Federal payment
stablecoin regulators, may by regulation or order, permit
such exceptions to subparagraph (A) as the Board considers
will not be contrary to the purpose of this Act.
(9) Prohibition on the use of deceptive names.--
(A) In general.--A permitted payment stablecoin issuer may
not--
(i) use any combination of terms relating to the United
States Government, including ``United States'', ``United
States Government'', and ``USG'' in the name of a payment
stablecoin; or
(ii) market a payment stablecoin in such a way that a
reasonable person would perceive the payment stablecoin to
be--

(I) legal tender, as described in section 5103 of title 31,
United States Code;
(II) issued by the United States; or
(III) guaranteed or approved by the Government of the
United States.

(B) Pegged stablecoins.--Abbreviations directly relating to
the currency to which a payment stablecoin is pegged, such as
``USD'', are not subject to the prohibitions in subparagraph
(A).
(10) Audits and reports.--
(A) Annual financial statement.--
(i) In general.--A permitted payment stablecoin issuer with
more than $50,000,000,000 in consolidated total outstanding
issuance, that is not subject to the reporting requirements
under section 13(a) or 15(d) of the Securities and Exchange
Act of 1934 (15 U.S.C. 78m, 78o(d)), shall prepare, in
accordance with generally accepted accounting principles, an
annual financial statement, which shall include the
disclosure of any related party transactions, as defined by
such generally accepted accounting principles.
(ii) Auditor.--A registered public accounting firm shall
perform an audit of the annual financial statements described
in clause (i).
(iii) Standards.--An audit described in clause (ii) shall
be conducted in accordance with all applicable auditing
standards established by the Public Company Accounting
Oversight Board, including those relating to auditor
independence, internal controls, and related party
transactions.
(iv) Rule of construction.--Nothing in this subparagraph
shall be construed to limit, alter, or expand the
jurisdiction of the Public Company Accounting Oversight Board
over permitted payment stablecoin issuers or registered
public accounting firms.
(B) Public disclosure and submission to federal
regulators.--Each permitted payment stablecoin issuer
required to prepare an audited annual financial statement
under subparagraph (A) shall--
(i) make such audited financial statements publicly
available on the website of the permitted payment stablecoin
issuer; and
(ii) submit such audited financial statements annually to
their primary Federal payment stablecoin regulator.
(C) Consultation.--The primary Federal payment stablecoin
regulators may consult with the Public Company Accounting
Oversight Board to determine best practices for determining
audit oversight and to detect fraud, material misstatements,
and other financial misrepresentations that could mislead
permitted payment stablecoin holders.
(11) Prohibition on interest.--No permitted payment
stablecoin issuer or foreign payment stablecoin issuer shall
pay the holder of any payment stablecoin any form of interest
or yield (whether in cash, tokens, or other consideration)
solely in connection with the holding, use, or retention of
such payment stablecoin.
(12) Non-financial services public companies.--
(A) Definitions.--In this paragraph:
(i) Financial activities.--The term ``financial
activities''--

(I) has the meaning given that term in section 4(k) of the
Bank Holding Company Act of 1956 (12 U.S.C. 1843(k)); and
(II) for the avoidance of doubt, includes those activities
described in subparagraphs (A) and (B) of section 2(7) and
section 4(a)(7)(A) of this Act.

(ii) Public company.--The term ``public company'' means an
issuer that is required to file reports under section 13(a)
or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C.
78m(a), 78o(d)).

[[Page H3409]]

(B) Prohibition.--
(i) In general.--A public company that is not predominantly
engaged in 1 or more financial activities, and its wholly or
majority owned subsidiaries or affiliates, may not issue a
payment stablecoin unless the public company obtains a
unanimous vote of the Stablecoin Certification Review
Committee finding that--

(I) it will not pose a material risk to the safety and
soundness of the United States banking system, the financial
stability of the United States, or the Deposit Insurance
Fund;
(II) the public company will comply with data use
limitations providing that, unless the public company
receives consent from the consumer, nonpublic personal
information obtained from stablecoin transaction data may not
be--

(aa) used to target, personalize, or rank advertising or
other content;
(bb) sold to any third party; or
(cc) shared with non-affiliates; and

(III) the public company and the affiliates of the public
company will comply with the tying prohibitions under
paragraph (8).

(ii) Exception.--The prohibition under clause (i) against
the sharing of consumer information shall not apply to
sharing of such information--

(I) to comply with Federal, State, or local laws, rules,
and other applicable legal requirements;
(II) to comply with a properly authorized civil, criminal,
or regulatory investigation, subpoena, or summons by a
Federal, State, or local authority; or
(III) to respond to judicial process or a government
regulatory authority having jurisdiction over the public
company.

(C) Extension of prohibition.--
(i) In general.--Any company not domiciled in the United
States or its Territories that is not predominantly engaged
in 1 or more financial activities, may not issue a payment
stablecoin unless the public company obtains a unanimous vote
of the Stablecoin Certification Review Committee finding
that--

(aa) used to target, personalize, or rank advertising or
other content;
(bb) sold to any third party; or
(cc) shared with non-affiliates; except

(III) the public company and the affiliates of the public
company will comply with the tying prohibitions under
paragraph (8).

(ii) Exception.--The prohibition under clause (i) against
the sharing of consumer information shall not apply to
sharing of such information--

(D) Rulemaking.--Not later than 1 year after the date of
enactment of this Act, the Stablecoin Certification Review
Committee shall issue an interpretive rule clarifying the
application of this paragraph.
(13) Eligibility.--Nothing in this Act shall be construed
as expanding or contracting legal eligibility to receive
services available from a Federal Reserve bank or to make
deposits with a Federal Reserve bank, in each case pursuant
to the Federal Reserve Act.
(14) Rule of construction.--Compliance with this section
does not alter or affect any additional requirement of a
State payment stablecoin regulator that may apply relating to
the offering of payment stablecoins.
(b) Regulation by the Comptroller.--
(1) In general.--Notwithstanding section 5136C of the
Revised Statutes (12 U.S.C. 25b), section 6 of the Home
Owners' Loan Act (12 U.S.C. 1465), or any applicable State
law relating to licensing and supervision, a Federal
qualified payment stablecoin issuer approved by the
Comptroller pursuant to section 5 of this Act shall be
licensed, regulated, examined, and supervised exclusively by
the Comptroller, which shall have authority, in coordination
with other relevant primary Federal payment stablecoin
regulators and State payment stablecoin regulators, to issue
such regulations and orders as necessary to ensure financial
stability and implement subsection (a).
(2) Conforming amendment.--Section 324(b) of the Revised
Statutes (12 U.S.C. 1(b)) is amended by adding at the end the
following:
``(3) Regulation of federal qualified payment stablecoin
issuers.--The Comptroller of the Currency shall, in
coordination with other relevant regulators and consistent
with section 13 of the GENIUS Act, issue such regulations and
orders as necessary to ensure financial stability and
implement section 4(a) of that Act.''.
(c) State-level Regulatory Regimes.--
(1) Option for state-level regulatory regime.--
Notwithstanding the Federal regulatory framework established
under this Act, a State qualified payment stablecoin issuer
with a consolidated total outstanding issuance of not more
than $10,000,000,000 may opt for regulation under a State-
level regulatory regime, provided that the State-level
regulatory regime is substantially similar to the Federal
regulatory framework under this Act.
(2) Principles.--The Secretary of the Treasury shall,
through notice and comment rulemaking, establish broad-based
principles for determining whether a State-level regulatory
regime is substantially similar to the Federal regulatory
framework under this Act.
(3) Review.--State payment stablecoin regulators shall
review State-level regulatory regimes according to the
principles established by the Secretary of the Treasury under
paragraph (2) and for the purposes of establishing any
necessary cooperative agreements to implement section 7(f).
(4) Certification.--
(A) Initial certification.--Subject to subparagraph (B),
not later than 1 year after the effective date of this Act, a
State payment stablecoin regulator shall submit to the
Stablecoin Certification Review Committee an initial
certification that the State-level regulatory regime meets
the criteria for substantial similarity established pursuant
to paragraph (2).
(B) Form of certification.--The initial certification
required under subparagraph (A) shall contain, in a form
prescribed by the Stablecoin Certification Review Committee,
an attestation that the State-level regulatory regime meets
the criteria for substantial similarity established pursuant
to paragraph (2).
(C) Annual recertification.--Not later than a date to be
determined by the Secretary of the Treasury each year, a
State payment stablecoin regulator shall submit to the
Stablecoin Certification Review Committee an additional
certification that confirms the accuracy of the initial
certification submitted under subparagraph (A).
(5) Certification review.--
(A) In general.--Not later than 30 days after the date on
which a State payment stablecoin regulator submits an initial
certification or a recertification under paragraph (4), the
Stablecoin Certification Review Committee shall--
(i) approve such certification if the Committee unanimously
determines that the State-level regulatory regime meets or
exceeds the standards and requirements described in
subsection (a); or
(ii) deny such certification and provide the State payment
stablecoin regulator with a written explanation of the
denial, describing the reasoned basis for the denial with
sufficient detail to enable the State payment stablecoin
regulator and State-level regulatory regime to make any
changes necessary to meet or exceed the standards and
requirements described in subsection (a).
(B) Recertifications.--With respect to any recertification
certification submitted by a State payment stablecoin
regulator under paragraph (4), the Stablecoin Certification
Review Committee shall only deny the recertification if--
(i) the State-level regulatory regime has materially
changed from the prior certification or there has been a
significant change in circumstances; and
(ii) the material change in the regime or significant
change in circumstances described in clause (i) is such that
the State-level regulatory regime will not promote the safe
and sound operation of State qualified payment stablecoin
issuers under its supervision.
(C) Opportunity to cure.--
(i) In general.--With respect to a denial described under
subparagraph (A) or (B), the Stablecoin Certification Review
Committee shall provide the State payment stablecoin
regulator with not less than 180 days from the date on which
the State payment stablecoin regulator is notified of such
denial to--

(I) make such changes as may be necessary to ensure the
State-level regulatory regime meets or exceeds the standards
described in subsection (a); and
(II) resubmit the initial certification or recertification.

(ii) Denial.--If, after a State payment stablecoin
regulator resubmits an initial certification or
recertification under clause (i), the Stablecoin
Certification Review Committee again determines that the
initial certification or recertification shall result in a
denial, the Stablecoin Certification Review Committee shall,
not later than 30 days after such determination, provide the
State payment stablecoin regulator with a written explanation
for the determination.
(D) Appeal of denial.--A State payment stablecoin regulator
in receipt of a denial under subparagraph (C)(ii) may appeal
the denial to the United States Court of Appeals for the
District of Columbia Circuit.
(E) Right to resubmit.--A State payment stablecoin
regulator in receipt of a denial under this paragraph shall
not be prohibited from resubmitting a new certification under
paragraph (4).
(6) List.--The Secretary of the Treasury shall publish and
maintain in the Federal Register and on the website of the
Department of the Treasury a list of States that have
submitted initial certifications and recertifications under
paragraph (4).
(7) Expedited certifications of existing regulatory
regimes.--The Stablecoin Certification Review Committee shall
take all

[[Page H3410]]

necessary steps to endeavor that, with respect to a State
that, within 180 days of the date of enactment of this Act,
has in effect a prudential regulatory regime (including
regulations and guidance) for the supervision of digital
assets or payment stablecoins, the certification process
under this paragraph with respect to that regime occurs on an
expedited timeline after the effective date of this Act.
(d) Transition to Federal Oversight.--
(1) Depository institution.--A State chartered depository
institution that is a State qualified payment stablecoin
issuer with a payment stablecoin with a consolidated total
outstanding issuance of more than $10,000,000,000 shall--
(A) not later than 360 days after the payment stablecoin
reaches such threshold, transition to the Federal regulatory
framework of the primary Federal payment stablecoin regulator
of the State chartered depository institution, which shall be
administered by the State payment stablecoin regulator of the
State chartered depository institution and the primary
Federal payment stablecoin regulator acting jointly; or
(B) beginning on the date the payment stablecoin reaches
such threshold, cease issuing new payment stablecoins until
the payment stablecoin is under the $10,000,000,000
consolidated total outstanding issuance threshold.
(2) Other institutions.--A State qualified payment
stablecoin issuer not described in paragraph (1) with a
payment stablecoin with a consolidated total outstanding
issuance of more than $10,000,000,000 shall--
(A) not later than 360 days after the payment stablecoin
reaches such threshold, transition to the Federal regulatory
framework under subsection (a) administered by the relevant
State payment stablecoin regulator and the Comptroller,
acting in coordination; or
(B) beginning on the date the payment stablecoin reaches
such threshold, cease issuing new payment stablecoins until
the payment stablecoin is under the $10,000,000,000
consolidated total outstanding issuance threshold.
(3) Waiver.--
(A) In general.--Notwithstanding paragraphs (1) and (2),
the applicable primary Federal payment stablecoin regulator
may permit a State qualified payment stablecoin issuer with a
payment stablecoin with a consolidated total outstanding
issuance of more than $10,000,000,000 to remain solely
supervised by a State payment stablecoin regulator.
(B) Criteria for waiver.--The primary Federal payment
stablecoin regulator shall consider the following exclusive
criteria in determining whether to issue a waiver under this
paragraph:
(i) The capital maintained by the State qualified payment
stablecoin issuer.
(ii) The past operations and examination history of the
State qualified payment stablecoin issuer.
(iii) The experience of the State payment stablecoin
regulator in supervising payment stablecoin and digital asset
activities.
(iv) The supervisory framework, including regulations and
guidance, of the State qualified payment stablecoin issuer
with respect to payment stablecoins and digital assets.
(C) Rule of construction.--
(i) Federal oversight.--A State qualified payment
stablecoin issuer subject to Federal oversight under
paragraph (1) or (2) of this subsection that does not receive
a waiver under this paragraph shall continue to be supervised
by the State payment stablecoin regulator of the State
qualified payment stablecoin issuer jointly with the primary
Federal payment stablecoin regulator. Nothing in this
subsection shall require the State qualified payment
stablecoin issuer to convert to a Federal charter.
(ii) State oversight.--A State qualified payment stablecoin
issuer supervised by a State payment stablecoin regulator
that has established a prudential regulatory regime
(including regulations and guidance) for the supervision of
digital assets or payment stablecoins before the 90-day
period ending on the date of enactment of this Act that has
been certified pursuant to subsection (c) and has approved 1
or more issuers to issue payment stablecoins under the
supervision of such State payment stablecoin regulator, shall
be presumptively approved for a waiver under this paragraph,
unless the Federal payment stablecoin regulator finds, by
clear and convincing evidence, that the requirements of
subparagraph (B) are not substantially met with respect to
that issuer or that the issuer poses significant safety and
soundness risks to the financial system of the United States.
(e) Misrepresentation of Insured Status.--
(1) In general.--Payment stablecoins shall not be backed by
the full faith and credit of the United States, guaranteed by
the United States Government, subject to deposit insurance by
the Federal Deposit Insurance Corporation, or subject to
share insurance by the National Credit Union Administration.
(2) Misrepresentation of insured status.--
(A) In general.--It shall be unlawful to represent that
payment stablecoins are backed by the full faith and credit
of the United States, guaranteed by the United States
Government, or subject to Federal deposit insurance or
Federal share insurance.
(B) Penalty.--A violation of subparagraph (A) shall be
considered a violation of section 18(a)(4) of the Federal
Deposit Insurance Act (12 U.S.C. 1828(a)(4)) or section 709
of title 18, United States Code, as applicable.
(3) Marketing.--
(A) In general.--It shall be unlawful to market a product
in the United States as a payment stablecoin unless the
product is issued pursuant to this Act.
(B) Penalty.--Whoever knowingly and willfully participates
in a violation of subparagraph (A) shall be fined by the
Department of the Treasury not more than $500,000 for each
such violation.
(C) Determination of the number of violations.--For
purposes of determining the number of violations for which to
impose penalties under subparagraph (B), separate acts of
noncompliance are a single violation when the acts are the
result of--
(i) a common or substantially overlapping originating
cause; or
(ii) the same statement or publication.
(D) Referral to secretary of the treasury.--If a Federal
payment stablecoin regulator has reason to believe that any
person has knowingly and willfully violated subparagraph (A),
the Federal payment stablecoin regulator shall refer the
matter to the Secretary of the Treasury.
(f) Officers or Directors Convicted of Certain Felonies.--
(1) In general.--No individual who has been convicted of a
felony offense involving insider trading, embezzlement,
cybercrime, money laundering, financing of terrorism, or
financial fraud may serve as--
(A) an officer of a payment stablecoin issuer; or
(B) a director of a payment stablecoin issuer.
(2) Penalty.--
(A) In general.--Whoever knowingly participates in a
violation of paragraph (1) shall be fined not more than
$1,000,000 for each such violation, imprisoned for not more
than 5 years, or both.
(B) Referral to attorney general.--If a Federal payment
stablecoin regulator has reason to believe that any person
has knowingly violated paragraph (1), the Federal payment
stablecoin regulator shall refer the matter to the Attorney
General.
(g) Clarification Relating to Federal Savings Association
Reserves.--A Federal savings association established under
the Home Owners' Loan Act (12 U.S.C. 1461 et seq.) that holds
a reserve that satisfies the requirements of section 4(a)(1)
shall not be required to satisfy the qualified thrift lender
test under section 10(m) of the Home Owners' Loan Act (12
U.S.C. 1467a(m)) with respect to such reserve assets.
(h) Rulemaking.--
(1) In general.--Consistent with section 13, the primary
Federal payment stablecoin regulators shall, and State
payment stablecoin regulators may, issue such regulations
relating to permitted payment stablecoin issuers as may be
necessary to establish a payment stablecoin regulatory
framework necessary to administer and carry out the
requirements of this section, including to establish
conditions, and to prevent evasion thereof.
(2) Coordinated issuance of regulations.--All regulations
issued to carry out this section shall be issued in
coordination by the primary Federal payment stablecoin
regulators, if not issued by a State payment stablecoin
regulator.
(i) Rules of Construction.--Nothing in this Act shall be
construed--
(1) as expanding the authority of the Board with respect to
the services the Board can make directly available to the
public; or
(2) to limit or prevent the continued application of
applicable ethics statutes and regulations administered by
the Office of Government Ethics, or the ethics rules of the
Senate and the House of Representatives, including section
208 of title 18, United States Code, and sections 2635.702
and 2635.802 of title 5, Code of Federal Regulations. For the
avoidance of doubt, existing Office of Government Ethics laws
and the ethics rules of the Senate and the House of
Representatives prohibit any member of Congress or senior
executive branch official from issuing a payment stablecoin
during their time in public service. For the purposes of this
paragraph, an employee described in section 202 of title 18,
United States Code, shall be deemed an executive branch
employee for purposes of complying with section 208 of that
title.

SEC. 5. APPROVAL OF SUBSIDIARIES OF INSURED DEPOSITORY
INSTITUTIONS AND FEDERAL QUALIFIED PAYMENT
STABLECOIN ISSUERS.

(a) Application.--
(1) In general.--Each primary Federal payment stablecoin
regulator shall--
(A) receive, review, and consider for approval applications
from any insured depository institution that seeks to issue
payment stablecoins through a subsidiary and any nonbank
entity, Federal branch, or uninsured national bank that is
chartered by the Comptroller pursuant to title LXII of the
Revised Statutes, and that seeks to issue payment stablecoins
as a Federal qualified payment stablecoin issuer; and
(B) establish a process and framework for the licensing,
regulation, examination, and supervision of such entities
that prioritizes the safety and soundness of such entities.
(2) Authority to issue regulations and process
applications.--The primary Federal payment stablecoin
regulators shall, before the date described in section 13--
(A) issue regulations consistent with that section to carry
out this section; and

[[Page H3411]]

(B) pursuant to the regulations described in subparagraph
(A), accept and process applications described in paragraph
(1).
(3) Mandatory approval process.--A primary Federal payment
stablecoin regulator shall, upon receipt of a substantially
complete application received under paragraph (1), evaluate
and make a determination on each application based on the
criteria established under this Act.
(b) Evaluation of Applications.--A substantially complete
application received under subsection (a) shall be evaluated
by the primary Federal payment stablecoin regulator using the
factors described in subsection (c).
(c) Factors to Be Considered.--The factors described in
this subsection are the following:
(1) The ability of the applicant (or, in the case of an
applicant that is an insured depository institution, the
subsidiary of the applicant), based on financial condition
and resources, to meet the requirements set forth under
section 4.
(2) Whether an individual who has been convicted of a
felony offense involving insider trading, embezzlement,
cybercrime, money laundering, financing of terrorism, or
financial fraud is serving as an officer or director of the
applicant.
(3) The competence, experience, and integrity of the
officers, directors, and principal shareholders of the
applicant, its subsidiaries, and parent company, including--
(A) the record of those officers, directors, and principal
shareholders of compliance with laws and regulations; and
(B) the ability of those officers, directors, and principal
shareholders to fulfill any commitments to, and any
conditions imposed by, their primary Federal payment
stablecoin regulator in connection with the application at
issue and any prior applications.
(4) Whether the redemption policy of the applicant meets
the standards under section 4(a)(1)(B).
(5) Any other factors established by the primary Federal
payment stablecoin regulator that are necessary to ensure the
safety and soundness of the permitted payment stablecoin
issuer.
(d) Timing for Decision; Grounds for Denial.--
(1) Timing for decisions on applications.--
(A) In general.--Not later than 120 days after receiving a
substantially complete application under subsection (a), a
primary Federal payment stablecoin regulator shall render a
decision on the application.
(B) Substantially complete.--
(i) In general.--For purposes of subparagraph (A), an
application shall be considered substantially complete if the
application contains sufficient information for the primary
Federal payment stablecoin regulator to render a decision on
whether the applicant satisfies the factors described in
subsection (c).
(ii) Notification.--Not later than 30 days after receiving
an application under subsection (a), a primary Federal
payment stablecoin regulator shall notify the applicant as to
whether the primary Federal payment stablecoin regulator
considers the application to be substantially complete and,
if the application is not substantially complete, the
additional information the applicant shall provide in order
for the application to be considered substantially complete.
(iii) Material change in circumstances.--An application
considered substantially complete under this subparagraph
remains substantially complete unless there is a material
change in circumstances that requires the primary Federal
payment stablecoin regulator to treat the application as a
new application.
(2) Denial of application.--
(A) Grounds for denial.--
(i) In general.--A primary Federal payment stablecoin
regulator shall only deny a substantially complete
application received under subsection (a) if the regulator
determines that the activities of the applicant would be
unsafe or unsound based on the factors described in
subsection (c).
(ii) Issuance on open, public, or decentralized network not
ground for denial.--The issuance of a payment stablecoin on
an open, public, or decentralized network shall not be a
valid ground for denial of an application received under
subsection (a).
(B) Explanation required.--If a primary Federal payment
stablecoin regulator denies a complete application received
under subsection (a), not later than 30 days after the date
of such denial, the regulator shall provide the applicant
with written notice explaining the denial with specificity,
including all findings made by the regulator with respect to
all identified material shortcomings in the application,
including actionable recommendations on how the applicant
could address the identified material shortcomings.
(C) Opportunity for hearing; final determination.--
(i) In general.--Not later than 30 days after the date of
receipt of any notice of the denial of an application under
this section, the applicant may request, in writing, an
opportunity for a written or oral hearing before the primary
Federal payment stablecoin regulator to appeal the denial.
(ii) Timing.--Upon receipt of a timely request under clause
(i), the primary Federal payment stablecoin regulator shall
notice a time (not later than 30 days after the date of
receipt of the request) and place at which the applicant may
appear, personally or through counsel, to submit written
materials or provide oral testimony and oral argument.
(iii) Final determination.--Not later than 60 days after
the date of a hearing under this subparagraph, the applicable
primary Federal payment stablecoin regulator shall notify the
applicant of a final determination, which shall contain a
statement of the basis for that determination, with specific
findings.
(iv) Notice if no hearing.--If an applicant does not make a
timely request for a hearing under this subparagraph, the
primary Federal payment stablecoin regulator shall notify the
applicant, not later than 10 days after the date by which the
applicant may request a hearing under this subparagraph, in
writing, that the denial of the application is a final
determination of the primary Federal payment stablecoin
regulator.
(3) Failure to render a decision.--If a primary Federal
payment stablecoin regulator fails to render a decision on a
complete application within the time period specified in
paragraph (1), the application shall be deemed approved.
(4) Right to reapply.--The denial of an application under
this section shall not prohibit the applicant from filing a
subsequent application.
(e) Reports on Pending Applications.--Each primary Federal
payment stablecoin regulator shall--
(1) notify Congress upon beginning to process applications
under this Act; and
(2) annually report to Congress on the applications that
have been pending for 180 days or more since the date the
initial application was filed and for which the applicant has
been informed that the application remains incomplete,
including documentation on the status of such applications
and why such applications have not yet been approved.
(f) Safe Harbor for Pending Applications.--The primary
Federal payment stablecoin regulators may waive the
application of the requirements of this Act for a period not
to exceed 12 months beginning on the effective date of this
Act, with respect to--
(1) a subsidiary of an insured depository institution, if
the insured depository institution has an application pending
for the subsidiary to become a permitted payment stablecoin
issuer on that effective date; or
(2) a Federal qualified payment stablecoin issuer with a
pending application on that effective date.
(g) Rulemaking.--Consistent with section 13, the primary
Federal payment stablecoin regulators shall issue rules
necessary for the regulation of the issuance of payment
stablecoins, but may not impose requirements in addition to
the requirements specified under section 4.
(h) Relation to Other Licensing Requirements.--The
provisions of this section supersede and preempt any State
requirement for a charter, license, or other authorization to
do business with respect to a Federal qualified payment
stablecoin issuer or subsidiary of an insured depository
institution or credit union that is approved under this
section to be a permitted payment stablecoin issuer. Nothing
in this subsection shall preempt or supersede the authority
of a State to charter, license, supervise, or regulate an
insured depository institution or credit union chartered in
such State or to supervise a subsidiary of such insured
depository institution or credit union that is approved under
this section to be a permitted payment stablecoin issuer.
(i) Certification Required.--
(1) In general.--Not later than 180 days after the approval
of an application, and on an annual basis thereafter, each
permitted payment stablecoin issuer shall submit to its
primary Federal payment stablecoin regulator, or in the case
of a State qualified payment stablecoin issuer its State
payment stablecoin regulator, a certification that the issuer
has implemented anti-money laundering and economic sanctions
compliance programs that are reasonably designed to prevent
the permitted payment stablecoin issuer from facilitating
money laundering, in particular, facilitating money
laundering for cartels and organizations designated as
foreign terrorist organizations under section 219 of the
Immigration and Nationality Act (8 U.S.C. 1189) and the
financing of terrorist activities, consistent with the
requirements of this Act.
(2) Availability of certifications.--Federal payment
stablecoin regulators and State payment stablecoin regulators
shall make certifications described in paragraph (1)
available to the Secretary of Treasury upon request.
(3) Penalties.--
(A) Approval revocation.--The primary Federal payment
stablecoin regulator or State payment stablecoin regulator of
a permitted payment stablecoin issuer that does not submit a
certification pursuant to paragraph (1) may revoke the
approval of the payment stablecoin issuer under this section.
(B) Criminal penalty.--
(i) In general.--Any person that knowingly submits a
certification pursuant to paragraph (1) that is false shall
be subject to the criminal penalties set forth under section
1001 of title 18, United States Code.
(ii) Referral to attorney general.--If a Federal payment
stablecoin regulator or State payment stablecoin regulator
has reason to believe that any person has knowingly

[[Page H3412]]

violated paragraph (1), the applicable regulator may refer
the matter to the Attorney General or to the attorney general
of the payment stablecoin issuer's host State.

SEC. 6. SUPERVISION AND ENFORCEMENT WITH RESPECT TO FEDERAL
QUALIFIED PAYMENT STABLECOIN ISSUERS AND
SUBSIDIARIES OF INSURED DEPOSITORY
INSTITUTIONS.

(a) Supervision.--
(1) In general.--Each permitted payment stablecoin issuer
that is not a State qualified payment stablecoin issuer with
a payment stablecoin with a consolidated total outstanding
issuance of less than $10,000,000,000 shall be subject to
supervision by the appropriate primary Federal payment
stablecoin regulator.
(2) Submission of reports.--Each permitted payment
stablecoin issuer described in paragraph (1) shall, upon
request, submit to the appropriate primary Federal payment
stablecoin regulator a report on--
(A) the financial condition of the permitted payment
stablecoin issuer;
(B) the systems of the permitted payment stablecoin issuer
for monitoring and controlling financial and operating risks;
(C) compliance by the permitted payment stablecoin issuer
(and any subsidiary thereof) with this Act; and
(D) the compliance of the Federal qualified nonbank payment
stablecoin issuer with the requirements of the Bank Secrecy
Act and with laws authorizing the imposition of sanctions and
implemented by the Secretary of the Treasury.
(3) Examinations.--The appropriate primary Federal payment
stablecoin regulator shall examine a permitted payment
stablecoin issuer described in paragraph (1) in order to
assess--
(A) the nature of the operations and financial condition of
the permitted payment stablecoin issuer;
(B) the financial, operational, technological, and other
risks associated within the permitted payment stablecoin
issuer that may pose a threat to--
(i) the safety and soundness of the permitted payment
stablecoin issuer; or
(ii) the stability of the financial system of the United
States; and
(C) the systems of the permitted payment stablecoin issuer
for monitoring and controlling the risks described in
subparagraph (B).
(4) Requirements for efficiency.--
(A) Use of existing reports.--In supervising and examining
a permitted payment stablecoin issuer under this subsection,
a primary Federal payment stablecoin regulator shall, to the
fullest extent possible, use existing reports and other
supervisory information.
(B) Avoidance of duplication.--A primary Federal payment
stablecoin regulator shall, to the fullest extent possible,
avoid duplication of examination activities, reporting
requirements, and requests for information in carrying out
this subsection with respect to a permitted payment
stablecoin issuer.
(C) Consideration of burden.--A primary Federal payment
stablecoin regulator shall, with respect to any examination
or request for the submission of a report under this
subsection, only request examinations and reports at a
cadence and in a format that is similar to that required for
similarly situated entities regulated by the primary Federal
payment stablecoin regulator.
(b) Enforcement.--
(1) Suspension or revocation of registration.--The primary
Federal payment stablecoin regulator of a permitted payment
stablecoin issuer that is not a State qualified payment
stablecoin issuer with a payment stablecoin with a
consolidated total outstanding issuance of less than
$10,000,000,000 may prohibit the permitted payment stablecoin
issuer from issuing payment stablecoins, if the primary
Federal payment stablecoin regulator determines that such
permitted payment stablecoin issuer, or an institution-
affiliated party of the permitted payment stablecoin issuer
is willfully or recklessly violating or has willfully or
recklessly violated--
(A) this Act or any regulation or order issued under this
Act; or
(B) any condition imposed in writing by the primary Federal
payment stablecoin regulator in connection with a written
agreement entered into between the permitted payment
stablecoin issuer and the primary Federal payment stablecoin
regulator.
(2) Cease-and-desist proceedings.--If the primary Federal
payment stablecoin regulator of a permitted payment
stablecoin issuer that is not a State qualified payment
stablecoin issuer with a payment stablecoin with a
consolidated total outstanding issuance of less than
$10,000,000,000 has reasonable cause to believe that the
permitted payment stablecoin issuer or any institution-
affiliated party of the permitted payment stablecoin issuer
is violating, has violated, or is attempting to violate this
Act, any regulation or order issued under this Act, or any
written agreement entered into with the primary Federal
payment stablecoin regulator or condition imposed in writing
by the primary Federal payment stablecoin regulator in
connection with any application or other request, the primary
Federal payment stablecoin regulator may, by provisions that
are mandatory or otherwise, order the permitted payment
stablecoin issuer or institution-affiliated party of the
permitted payment stablecoin issuer to--
(A) cease and desist from such violation or practice; or
(B) take affirmative action to correct the conditions
resulting from any such violation or practice.
(3) Removal and prohibition authority.--The primary Federal
payment stablecoin regulator of a permitted payment
stablecoin issuer that is not a State qualified payment
stablecoin issuer may remove an institution-affiliated party
of the permitted payment stablecoin issuer from the position
or office of that institution-affiliated party or prohibit
further participation in the affairs of the permitted payment
stablecoin issuer or of all such permitted payment stablecoin
issuers by that institution-affiliated party, if the primary
Federal payment stablecoin regulator determines that--
(A) the institution-affiliated party has knowingly
committed a violation or attempted violation of this Act or
any regulation or order issued under this Act; or
(B) the institution-affiliated party has knowingly
committed a violation of any provision of subchapter II of
chapter 53 of title 31, United States Code.
(4) Procedures.--
(A) In general.--If a primary Federal payment stablecoin
regulator identifies a violation or attempted violation of
this Act or makes a determination under paragraph (1), (2),
or (3), the primary Federal payment stablecoin regulator
shall comply with the procedures set forth in subsections (b)
and (e) of section 8 of the Federal Deposit Insurance Act (12
U.S.C. 1818) or subsections (e) and (g) of section 206 the
Federal Credit Union Act (12 U.S.C. 1786(e) and (g)), as
applicable.
(B) Judicial review.--A person aggrieved by a final action
under this subsection may obtain judicial review of such
action exclusively as provided in section 8(h) of the Federal
Deposit Insurance Act (12 U.S.C. 1818(h)) or section 206(j)
of the Federal Credit Union Act (12 U.S.C. 1786(j)), as
applicable.
(C) Injunction.--A primary Federal payment stablecoin
regulator may, at the discretion of the regulator, follow the
procedures provided in section 8(i)(1) of the Federal Deposit
Insurance Act (12 U.S.C. 1818(i)(1)) or section 206(k)(1) of
the Federal Credit Union Act (12 U.S.C. 1786(k)(1)), as
applicable, for judicial enforcement of any effective and
outstanding notice or order issued under this subsection.
(D) Temporary cease-and-desist proceedings.--If a primary
Federal payment stablecoin regulator determines that a
violation or attempted violation of this Act or an action
with respect to which a determination was made under
paragraph (1), (2), or (3), or the continuation thereof, is
likely to cause insolvency or significant dissipation of
assets or earnings of a permitted payment stablecoin issuer,
or is likely to weaken the condition of the permitted payment
stablecoin issuer or otherwise prejudice the interests of the
customers of the permitted payment stablecoin issuer prior to
the completion of the proceedings conducted under this
paragraph, the primary Federal payment stablecoin regulator
may follow the procedures provided in section 8(c) of the
Federal Deposit Insurance Act (12 U.S.C. 1818(c)) or section
206(f) of the Federal Credit Union Act (12 U.S.C. 1786(f)),
as applicable, to issue a temporary cease and desist order.
(5) Civil money penalties.--Unless otherwise specified in
this Act, the civil money penalties for violations of this
Act consist of the following:
(A) Failure to be approved.--Any person that issues a
United States dollar-denominated payment stablecoin in
violation of section 3, and any institution-affiliated party
of such a person who knowingly participates in issuing such a
payment stablecoin, shall be liable for a civil penalty of
not more than $100,000 for each day during which such payment
stablecoins are issued.
(B) First tier.--Except as provided in subparagraph (A), a
permitted payment stablecoin issuer or institution-affiliated
party of such permitted payment stablecoin issuer that
materially violates this Act or any regulation or order
issued under this Act, or that materially violates any
condition imposed in writing by the appropriate primary
Federal payment stablecoin regulator in connection with a
written agreement entered into between the permitted payment
stablecoin issuer and that primary Federal payment stablecoin
regulator, shall be liable for a civil penalty of not more
than $100,000 for each day during which the violation
continues.
(C) Second tier.--Except as provided in subparagraph (A),
and in addition to the penalties described in subparagraph
(B), a permitted payment stablecoin issuer or institution-
affiliated party of such permitted payment stablecoin issuer
who knowingly participates in a violation of any provision of
this Act, or any regulation or order issued under this Act,
shall be liable for a civil penalty of not more than an
additional $100,000 for each day during which the violation
continues.
(D) Procedure.--Any penalty imposed under this paragraph
may be assessed and collected by the appropriate primary
Federal payment stablecoin regulator pursuant to the
procedures set forth in section 8(i)(2) of the Federal
Deposit Insurance Act (12 U.S.C. 1818(i)(2)) or section
206(k)(2) of the Federal Credit Union Act (12 U.S.C.
1786(k)(2)), as applicable.
(E) Notice and orders after separation from service.--The
resignation, termination

[[Page H3413]]

of employment or participation, or separation of an
institution-affiliated party (including a separation caused
by the closing of a permitted payment stablecoin issuer)
shall not affect the jurisdiction and authority of a primary
Federal payment stablecoin regulator to issue any notice or
order and proceed under this subsection against any such
party, if such notice or order is served before the end of
the 6-year period beginning on the date on which such party
ceased to be an institution-affiliated party with respect to
such permitted payment stablecoin issuer.
(6) Non-applicability to a state qualified payment
stablecoin issuer.--Notwithstanding anything in this
subsection to the contrary, this subsection shall not apply
to a State qualified payment stablecoin issuer.
(c) Rule of Construction.--Nothing in this Act may be
construed to modify or otherwise affect any right or remedy
under any Federal consumer financial law, including 12 U.S.C.
5515 and 15 U.S.C. 41 et seq.

SEC. 7. STATE QUALIFIED PAYMENT STABLECOIN ISSUERS.

(a) In General.--A State payment stablecoin regulator shall
have supervisory, examination, and enforcement authority over
all State qualified payment stablecoin issuers of such State.
(b) Authority To Enter Into Agreements With the Board.--A
State payment stablecoin regulator may enter into a
memorandum of understanding with the Board, by mutual
agreement, under which the Board may participate in the
supervision, examination, and enforcement of this Act with
respect to the State qualified payment stablecoin issuers of
such State.
(c) Sharing of Information.--A State payment stablecoin
regulator and the Board shall share information on an ongoing
basis with respect to a State qualified payment stablecoin
issuer of such State, including a copy of the initial
application and any accompanying documents.
(d) Rulemaking.--A State payment stablecoin regulator may
issue orders and rules under section 4 applicable to State
qualified payment stablecoin issuers to the same extent as
the primary Federal payment stablecoin regulators issue
orders and rules under section 4 applicable to permitted
payment stablecoin issuers that are not State qualified
payment stablecoin issuers.
(e) Enforcement Authority in Unusual and Exigent
Circumstances.--
(1) Board.--
(A) In general.--Subject to subparagraph (C), under unusual
and exigent circumstances that the Board determines to exist,
the Board may, after not less than 48 hours' prior written
notice to the applicable State payment stablecoin regulator,
take an enforcement action against a State qualified payment
stablecoin issuer or an institution-affiliated party of such
issuer for violations of this Act during such unusual and
exigent circumstances.
(B) Rulemaking.--Consistent with section 13, the Board
shall issue rules to set forth the unusual and exigent
circumstances in which the Board may act under this
paragraph.
(C) Limitations.--If, after unusual and exigent
circumstances are determined to exist pursuant to
subparagraph (A), the Board determines that there is
reasonable cause to believe that the continuation by a State
qualified payment stablecoin issuer of any activity
constitutes a serious risk to the financial safety,
soundness, or stability of the State qualified payment
stablecoin issuer, the Board may impose such restrictions as
the Board determines to be necessary to address such risk
during such unusual and exigent circumstances, which may
include limitations on redemptions of payment stablecoins,
and which shall be issued in the form of a directive, with
the effect of a cease and desist order that has become final,
to the State qualified payment stablecoin issuer and any of
its affiliates, limiting--
(i) transactions between the State qualified payment
stablecoin issuer, a holding company, and the subsidiaries or
affiliates of either the State qualified payment stablecoin
issuer or the holding company; and
(ii) any activities of the State qualified payment
stablecoin issuer that might create a serious risk that the
liabilities of a holding company and the affiliates of the
holding company may be imposed on the State qualified payment
stablecoin issuer.
(D) Review of directive.--
(i) Administrative review.--

(I) In general.--After a directive described in
subparagraph (C) is issued, the applicable State qualified
payment stablecoin issuer, or any institution-affiliated
party of the State qualified payment stablecoin issuer
subject to the directive, may object and present to the
Board, in writing, the reasons why the directive should be
modified or rescinded.
(II) Automatic lapse of directive.--If, after 10 days after
the receipt of a response described in subclause (I), the
Board does not affirm, modify, or rescind the directive, the
directive shall automatically lapse.

(ii) Judicial review.--

(I) In general.--If the Board affirms or modifies a
directive pursuant to clause (i), any affected party may
immediately thereafter petition the United States district
court for the district in which the main office of the
affected party is located, or in the United States District
Court for the District of Columbia, to stay, modify,
terminate, or set aside the directive.
(II) Relief for extraordinary cause.--Upon a showing of
extraordinary cause, an affected party may petition for
relief under subclause (I) without first pursuing or
exhausting the administrative remedies under clause (i).

(2) Comptroller.--
(A) In general.--Subject to subparagraph (C), under unusual
and exigent circumstances determined to exist by the
Comptroller, the Comptroller shall, after not less than 48
hours' prior written notice to the applicable State payment
stablecoin regulator, take an enforcement action against a
State qualified payment stablecoin issuer that is a nonbank
entity for violations of this Act.
(B) Rulemaking.--Consistent with section 13, the
Comptroller shall issue rules to set forth the unusual and
exigent circumstances in which the Comptroller may act under
this paragraph.
(C) Limitations.--If, after unusual and exigent
circumstances are determined to exist under subparagraph (A),
the Comptroller determines that there is reasonable cause to
believe that the continuation of any activity by a State
qualified payment stablecoin issuer that is a nonbank entity
constitutes a serious risk to the financial safety,
soundness, or stability of the State qualified payment
stablecoin issuer that is a nonbank entity, the Comptroller
shall impose such restrictions as the Comptroller determines
to be necessary to address such risk during such unusual and
exigent circumstances, which may include limitations on
redemption of payment stablecoins, and which shall be issued
in the form of a directive, with the effect of a cease and
desist order that has become final, to the State qualified
payment stablecoin issuer that is a nonbank entity and any of
its affiliates, limiting--
(i) transactions between the State qualified payment
stablecoin issuer, a holding company, and the subsidiaries or
affiliates of either the State qualified payment stablecoin
issuer or the holding company; and
(ii) any activities of the State qualified payment
stablecoin issuer that might create a serious risk that the
liabilities of a holding company and the affiliates of the
holding company may be imposed on the State qualified payment
stablecoin issuer.
(D) Review of directive.--
(i) Administrative review.--

(I) In general.--After a directive described in
subparagraph (C) is issued, the applicable Federal qualified
payment stablecoin issuer, or any institution-affiliated
party of the Federal qualified payment stablecoin issuer
subject to the directive, may object and present to the
Comptroller, in writing, the reasons that the directive
should be modified or rescinded.
(II) Automatic lapse of directive.--If, after 10 days after
the receipt of a response described in subclause (I), the
Comptroller does not affirm, modify, or rescind the
directive, the directive shall automatically lapse.

(ii) Judicial review.--

(I) In general.--If the Comptroller affirms or modifies a
directive pursuant to clause (i), any affected party may
immediately thereafter petition the United States district
court for the district in which the main office of the
affected party is located, or in the United States District
Court for the District of Columbia, to stay, modify,
terminate, or set aside the directive.
(II) Relief for extraordinary cause.--Upon a showing of
extraordinary cause, an affected party may petition for
relief under subclause (I) without first pursuing or
exhausting the administrative remedies under clause (i).

(f) Effect on State Law.--
(1) Host state law.--Notwithstanding any other provision of
law, the laws of a host State, including laws relating to
consumer protection, shall only apply to the activities
conducted in the host State by an out-of-State State
qualified payment stablecoin issuer to the same extent as
such laws apply to the activities conducted in the host State
by an out-of-State Federal qualified payment stablecoin
issuer.
(2) Home state law.--If any host State law is determined
not to apply under paragraph (1), the laws of the home State
of the State qualified payment stablecoin issuer shall govern
the activities of the permitted payment stablecoin issuer
conducted in the host State.
(3) Applicability.--
(A) In general.--This subsection shall only apply to an
out-of-State State qualified payment stablecoin issuer
chartered, licensed, or otherwise authorized to do business
by a State that has a certification in place pursuant to
section 4(c) of this Act.
(B) Exclusion.--The laws applicable to an out-of-State
qualified payment stablecoin issuer under paragraph (1)
exclude host State laws governing the chartering, licensure,
or other authorization to do business in the host State as a
permitted payment stablecoin issuer pursuant to this Act.
(4) Rule of construction.--Except for State laws relating
to the chartering, licensure, or other authorization to do
business as a permitted payment stablecoin issuer, nothing in
this Act shall preempt State consumer protection laws,
including common law, and the remedies available thereunder.

SEC. 8. ANTI-MONEY LAUNDERING PROTECTIONS.

(a) Payment Stablecoins Issued by a Foreign Payment
Stablecoin Issuer.--
(1) In general.--A payment stablecoin that is issued by a
foreign payment stablecoin issuer may not be publicly
offered, sold, or otherwise made available for

[[Page H3414]]

trading in the United States by a digital asset service
provider unless the foreign payment stablecoin issuer has the
technological capability to comply and complies with the
terms of any lawful order.
(2) Enforcement.--
(A) Authority.--The Secretary of the Treasury shall have
the authority to designate any foreign issuer that publicly
offers, sells, or otherwise makes available a payment
stablecoin in violation of paragraph (1) as noncompliant.
(B) Designation as noncompliant.--Not later than 30 days
after the Department of the Treasury has identified a foreign
payment stablecoin issuer of any payment stablecoin trading
in the United States that is in violation of paragraph (1),
the Secretary of the Treasury, in coordination with relevant
Federal agencies, may, pursuant to the authority under
subparagraph (A), designate the foreign payment stablecoin
issuer as noncompliant and notify the foreign payment
stablecoin issuer in writing of the designation.
(3) Appeal.--A determination of noncompliance under this
subsection is subject to judicial review in the United States
Court of Appeals for the District of Columbia Circuit.
(b) Publication of Designation; Prohibition on Secondary
Trading.--
(1) In general.--If a foreign payment stablecoin issuer
does not come into compliance with the lawful order within 30
days from the date of issuance of the written notice
described in subsection (a), except as provided in subsection
(c), the Secretary of the Treasury shall--
(A) publish the determination of noncompliance in the
Federal Register, including a statement on the failure of the
foreign payment stablecoin issuer to comply with the lawful
order after the written notice; and
(B) issue a notification in the Federal Register
prohibiting digital asset service providers from facilitating
secondary trading of payment stablecoins issued by the
foreign payment stablecoin issuer in the United States.
(2) Effective date of prohibition.--The prohibition on
facilitation of secondary trading described in paragraph (1)
shall become effective on the date that is 30 days after the
date of issue of notification of the prohibition in the
Federal Register.
(3) Expiration of prohibition.--
(A) In general.--The prohibition on facilitation of
secondary trading described in paragraph (1)(B) shall expire
upon the Secretary of the Treasury's determination that the
foreign payment stablecoin issuer is no longer noncompliant.
(B) Rulemaking.--Consistent with section 13, the Secretary
of the Treasury shall specify the criteria that a
noncompliant foreign issuer must meet for the Secretary of
the Treasury to determine that the foreign payment stablecoin
issuer is no longer noncompliant.
(C) Publication.--Upon a determination under subparagraph
(A), the Secretary of the Treasury shall publish the
determination in the Federal Register, including a statement
detailing how the foreign payment stablecoin issuer has met
the criteria described in subparagraph (B).
(4) Civil monetary penalties.--The Secretary of the
Treasury may impose a civil monetary penalty as follows:
(A) Digital asset service providers.--Any digital asset
service provider that knowingly violates a prohibition under
paragraph (1)(B) shall be subject to a civil monetary penalty
of not more than $100,000 per violation per day.
(B) Foreign payment stablecoin issuers.--Any foreign
payment stablecoin issuer that knowingly continues to
publicly offer a payment stablecoin in the United States
after publication of the determination of noncompliance under
paragraph (1)(A) shall be subject to a civil monetary penalty
of not more than $1,000,000 per violation per day, and the
Secretary of the Treasury may seek an injunction in a
district court of the United States to bar the foreign
payment stablecoin issuer from engaging in financial
transactions in the United States or with United States
persons.
(C) Determination of the number of violations.--For
purposes of determining the number of violations for which to
impose a penalty under subparagraph (A) or (B), separate acts
of noncompliance are a single violation when the acts are the
result of a common or substantially overlapping originating
cause. Notwithstanding the foregoing, the Secretary of
Treasury may determine that multiple acts of noncompliance
constitute separate violations if such acts were the result
of gross negligence, a reckless disregard for, or a pattern
of indifference to, money laundering, financing of terrorism,
or sanctions evasion requirements.
(D) Commencement of civil actions.--The Secretary of the
Treasury may commence a civil action against a foreign
payment stablecoin issuer in a district court of the United
States to--
(i) recover a civil monetary penalty assessed under
subparagraph (A) or (B);
(ii) seek an injunction to bar the foreign payment
stablecoin issuer from engaging in financial transactions in
the United States or with United States persons; or
(iii) seek an injunction to stop a digital asset service
provider from offering on the platform of the digital asset
service provider payment stablecoins issued by the foreign
payment stablecoin issuer.
(c) Waiver and Licensing Authority Exemptions.--
(1) In general.--The Secretary of the Treasury may offer a
waiver, general license, or specific license to any United
States person engaging in secondary trading described in
subsection (b)(1)(B) on a case-by-case basis if the Secretary
determines that--
(A) prohibiting secondary trading would adversely affect
the financial system of the United States; or
(B) the foreign payment stablecoin issuer is taking
tangible steps to remedy the failure to comply with the
lawful order that resulted in the noncompliance determination
under subsection (a).
(2) National security waiver.--The Secretary of the
Treasury, in consultation with the Director of National
Intelligence and the Secretary of State, may waive the
application of the secondary trading restrictions under
subsection (b)(1)(B) if the Secretary of the Treasury
determines that the waiver is in the national security
interest of the United States.
(3) Waiver for intelligence and law enforcement
activities.--The head of a department or agency may waive the
application of this section with respect to--
(A) activities subject to the reporting requirements under
title V of the National Security Act of 1947 (50 U.S.C. 3091
et seq.), or any authorized intelligence activities of the
United States; or
(B) activities necessary to carry out or assist law
enforcement activity of the United States.
(4) Report required.--Not later than 7 days after issuing a
waiver or a license under paragraph (1), (2), or (3), the
Secretary of the Treasury shall submit to the chairs and
ranking members of the Committee on Banking, Housing, and
Urban Affairs of the Senate and the Committee on Financial
Services of the House of Representatives, a report, which may
include a classified annex, if applicable, including the text
of the waiver or license, as well as the facts and
circumstances justifying the waiver determination, and
provide a briefing on the report.
(d) Rule of Construction.--Nothing in this Act shall be
construed as altering the existing authority of the Secretary
of the Treasury to block, restrict, or limit transactions
involving payment stablecoins that reference or are
denominated in United States dollars that are subject to the
jurisdiction of the United States.

SEC. 9. ANTI-MONEY LAUNDERING INNOVATION.

(a) Public Comment.--Beginning on the date that is 30 days
after the date of enactment of this Act, and for a period of
60 days thereafter, the Secretary of the Treasury shall seek
public comment to identify innovative or novel methods,
techniques, or strategies that regulated financial
institutions use, or have the potential to use, to detect
illicit activity, such as money laundering, involving digital
assets, including comments with respect to--
(1) application program interfaces;
(2) artificial intelligence;
(3) digital identify verification; and
(4) use of blockchain technology and monitoring.
(b) Treasury Research.--
(1) In general.--Upon completion of the public comment
period described in subsection (a), the Secretary of the
Treasury shall conduct research on the innovative or novel
methods, techniques, or strategies that regulated financial
institutions use, or have the potential to use, to detect
illicit activity, such as money laundering, involving digital
assets that were identified in such public comment period.
(2) Research factors.--With respect to each innovative or
novel method, technique, or strategy described in paragraph
(1), the Financial Crimes Enforcement Network shall evaluate
and consider the following factors against existing methods,
techniques, or strategies:
(A) Improvements in the ability of financial institutions
to detect illicit activity involving digital assets.
(B) Costs to regulated financial institutions.
(C) The amount and sensitivity of information that is
collected or reviewed.
(D) Privacy risks associated with the information that is
collected or reviewed.
(E) Operational challenges and efficiency considerations.
(F) Cybersecurity risks.
(G) Effectiveness of methods, techniques, or strategies at
mitigating illicit finance.
(c) Treasury Risk Assessment.--As part of the national
strategy for combating terrorist and other illicit financing
required under sections 261 and 262 of the Countering
America's Adversaries Through Sanctions Act (Public Law 115-
44; 131 Stat. 934), the Secretary of the Treasury shall
consider--
(1) the source of illicit activity, such as money
laundering and sanctions evasion involving digital assets;
(2) the effectiveness of and gaps in existing methods,
techniques, and strategies used by regulated financial
institutions in detecting illicit activity, such as money
laundering, involving digital assets;
(3) the impact of existing regulatory frameworks on the use
and development of innovative methods, techniques, or
strategies by regulated financial institutions; and
(4) any foreign jurisdictions that pose a high risk of
facilitating illicit activity through the use of digital
assets to obtain fiat currency.
(d) FinCEN Guidance or Rulemaking.--Not later than 3 years
after the date of enactment of this Act, the Financial Crimes

[[Page H3415]]

Enforcement Network shall issue public guidance and notice
and comment rulemaking, based on the results of the research
and risk assessments required under this section, relating to
the following:
(1) The implementation of innovative or novel methods,
techniques, or strategies by regulated financial institutions
to detect illicit activity involving digital assets.
(2) Standards for payment stablecoin issuers to identify
and report illicit activity involving the payment stablecoin
of a permitted payment stablecoin issuer, including, fraud,
cybercrime, money laundering, financing of terrorism,
sanctions evasion, or insider trading.
(3) Standards for payment stablecoin issuers' systems and
practices to monitor transactions on blockchains, digital
asset mixing services, tumblers, or other similar services
that mix payment stablecoins in such a way as to make such
transaction or the identity of the transaction parties less
identifiable.
(4) Tailored risk management standards for financial
institutions interacting with decentralized finance
protocols.
(e) Recommendations and Report to Congress.--
(1) In general.--Not later than 180 days after the date of
enactment of this Act, the Secretary of the Treasury shall
submit to the chairs and ranking members of the Committee on
Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of
Representatives a report on--
(A) legislative and regulatory proposals to allow regulated
financial institutions to develop and implement novel and
innovative methods, techniques, or strategies to detect
illicit activity, such as money laundering and sanctions
evasion, involving digital assets;
(B) the results of the research and risk assessments
conducted pursuant to this section;
(C) efforts to support the ability of financial
institutions to implement novel and innovative methods,
techniques, or strategies to detect illicit activity, such as
money laundering and sanctions evasion, involving digital
assets;
(D) the extent to which transactions on distributed
ledgers, digital asset mixing services, tumblers, or other
similar services that mix payment stablecoins in such a way
as to make such transaction or the identity of the
transaction parties less identifiable may facilitate illicit
activity; and
(E) legislative recommendations relating to the scope of
the term ``digital asset service provider'' and the
application of that term to decentralized finance.
(2) Classified annex.--A report under this section may
include a classified annex, if applicable.
(f) Rule of Construction.--Nothing in this section shall be
construed to limit the existing authority of the Secretary of
the Treasury or the primary Federal payment stablecoin
regulators to, prior to the submission of a report required
under this section, use existing exemptive authorities, the
no-action letter process, or rulemaking authorities in a
manner that encourages regulated financial institutions to
adopt novel or innovative methods, techniques, or strategies
to detect illicit activity, such as money laundering,
involving digital assets.

SEC. 10. CUSTODY OF PAYMENT STABLECOIN RESERVE AND
COLLATERAL.

(a) In General.--A person may only engage in the business
of providing custodial or safekeeping services for the
payment stablecoin reserve, the payment stablecoins used as
collateral, or the private keys used to issue permitted
payment stablecoins if the person--
(1) is subject to--
(A) supervision or regulation by a primary Federal payment
stablecoin regulator or a primary financial regulatory agency
described under subparagraph (B) or (C) of section 2(12) of
the Dodd-Frank Wall Street Reform and Consumer Protection Act
(12 U.S.C. 5301(12)); or
(B) supervision by a State bank supervisor, as defined
under section 3 of the Federal Deposit Insurance Act (12
U.S.C. 1813), or a State credit union supervisor, as defined
under section 6003 of the Anti-Money Laundering Act of 2020
(31 U.S.C. 5311 note), and such State bank supervisor or
State credit union supervisor makes available to the Board
such information as the Board determines necessary and
relevant to the categories of information under subsection
(d); and
(2) complies with the requirements under subsection (b),
unless such person holds such property in accordance with
similar requirements as required by a primary Federal payment
stablecoin regulator, the Securities and Exchange Commission,
or the Commodity Futures Trading Commission.
(b) Customer Property Requirement.--A person described in
subsection (a) shall, with respect to other property
described in that subsection--
(1) treat and deal with the payment stablecoins, private
keys, cash, and other property of a person for whom or on
whose behalf the person described in that subsection
receives, acquires, or holds payment stablecoins, private
keys, cash, and other property (hereinafter referred to in
this section as the ``customer'') as belonging to such
customer and not as the property of such person; and
(2) take such steps as are appropriate to protect the
payment stablecoins, private keys, cash, and other property
of a customer from the claims of creditors of the person.
(c) Commingling Prohibited.--
(1) In general.--Payment stablecoin reserves, payment
stablecoins, cash, and other property of a permitted payment
stablecoin issuer or customer shall be separately accounted
for by a person described in subsection (a) and shall be
segregated from and not be commingled with the assets of the
person.
(2) Exceptions.--Notwithstanding paragraph (1) or
subsection (b)--
(A) the payment stablecoin reserves, payment stablecoins,
cash, and other property of a permitted payment stablecoin
issuer or customer may, for convenience, be commingled and
deposited in an omnibus account holding the payment
stablecoin reserves, payment stablecoins, cash, and other
property of more than 1 permitted payment stablecoin issuer
or customer at a State chartered depository institution, an
insured depository institution, national bank, or trust
company, and any payment stablecoin reserves in the form of
cash held in the form of a deposit liability at a depository
institution shall not be subject to any requirement relating
to the separation of such cash from the property of the
applicable depository institution;
(B) such share of the payment stablecoin reserves, payment
stablecoins, cash, and other property of the permitted
payment stablecoin issuer or customer that shall be necessary
to transfer, adjust, or settle a transaction or transfer of
assets may be withdrawn and applied to such purposes,
including the payment of commissions, taxes, storage, and
other charges lawfully accruing in connection with the
provision of services by a person described in subsection
(a);
(C) in accordance with such terms and conditions as a
primary Federal payment stablecoin regulator may prescribe by
rule, regulation, or order, any payment stablecoin reserves,
payment stablecoins, cash, and other property described in
this subsection may be commingled and deposited in permitted
payment stablecoin issuer or customer accounts with payment
stablecoin reserves, payment stablecoins, cash, and other
property received by the person and required by the primary
Federal payment stablecoin regulator to be separately
accounted for, treated as, and dealt with as belonging to
such permitted payment stablecoin issuers or customers; or
(D) an insured depository institution that provides
custodial or safekeeping services for payment stablecoin
reserves shall be permitted to hold payment stablecoin
reserves in the form of cash on deposit provided such
treatment is consistent with Federal law.
(3) Customer priority.--With respect to payment stablecoins
held by a person described in subsection (a) for a customer,
with or without the segregation required under paragraph (1),
the claims of the customer against such person with respect
to such payment stablecoins shall have priority over the
claims of any person other than the claims of another
customer with respect to payment stablecoins held by such
person described in subsection (a), unless the customer
expressly consents to the priority of such other claim.
(d) Regulatory Information.--A person described under
subsection (a) shall submit to the applicable primary Federal
payment stablecoin regulator information concerning the
person's business operations and processes to protect
customer assets, in such form and manner as the primary
regulator shall determine.
(e) Exclusion.--The requirements of this section shall not
apply to any person solely on the basis that such person
engages in the business of providing hardware or software to
facilitate a customer's own custody or safekeeping of the
customer's payment stablecoins or private keys.

SEC. 11. TREATMENT OF PAYMENT STABLECOIN ISSUERS IN
INSOLVENCY PROCEEDINGS.

(a) In General.--Subject to section 507(e) of title 11,
United States Code, as added by subsection (d), in any
insolvency proceeding of a permitted payment stablecoin
issuer under Federal or State law, including any proceeding
under that title and any insolvency proceeding administered
by a State payment stablecoin regulator with respect to a
permitted payment stablecoin issuer--
(1) the claim of a person holding payment stablecoins
issued by the permitted payment stablecoin issuer shall have
priority, on a ratable basis with the claims of other persons
holding such payment stablecoins, over the claims of the
permitted payment stablecoin issuer and any other holder of
claims against the permitted payment stablecoin issuer, with
respect to required payment stablecoin reserves;
(2) notwithstanding any other provision of law, including
the definition of ``claim'' under section 101(5) of title 11,
United States Code, any person holding a payment stablecoin
issued by the permitted payment stablecoin issuer shall be
deemed to hold a claim; and
(3) the priority under paragraph (1) shall not apply to
claims other than those arising directly from the holding of
payment stablecoins.
(b) Definitions.--Section 101 of title 11, United States
Code, is amended by adding after paragraph (40B) the
following:
``(40C) The terms `payment stablecoin' and `permitted
payment stablecoin issuer' have

[[Page H3416]]

the meanings given those terms in section 2 of the GENIUS
Act.''.
(c) Automatic Stay.--Section 362 of title 11, United States
Code, is amended--
(1) in subsection (a)--
(A) in paragraph (7), by striking ``and'';
(B) in paragraph (8), by striking the period and inserting
``; and''; and
(C) by adding at the end the following:
``(9) the redemption of payment stablecoins issued by the
permitted payment stablecoin issuer, from payment stablecoin
reserves required to be maintained under section 4 of the
GENIUS Act.''; and
(2) in subsection (d)--
(A) in paragraph (3)(B)(ii), by striking ``or'' at the end;
(B) in paragraph (4)(B), by striking the period at the end
and inserting ``; or''; and
(C) by inserting after paragraph (4) the following:
``(5) with respect to the redemption of payment stablecoins
held by a person, if the court finds, subject to the motion
and attestation of the permitted payment stablecoin issuer,
which shall be filed on the petition date or as soon as
practicable thereafter, there are payment stablecoin reserves
available for distribution on a ratable basis to similarly
situated payment stablecoin holders, provided that the court
shall use best efforts to enter a final order to begin
distributions under this paragraph not later than 14 days
after the date of the required hearing.''.
(d) Priority in Bankruptcy Proceedings.--Section 507 of
title 11, United States Code, is amended--
(1) in subsection (a), in the matter preceding paragraph
(1), by striking ``The following'' and inserting ``Subject to
subsection (e), the following''; and
(2) by adding at the end the following:
``(e) Notwithstanding subsection (a), if a payment
stablecoin holder is not able to redeem all outstanding
payment stablecoin claims from required payment stablecoin
reserves maintained by the permitted payment stablecoin
issuer, any such remaining claim arising from a person's
holding of a payment stablecoin issued by the permitted
payment stablecoin issuer shall be a claim against the estate
and shall have first priority over any other claim, including
over any expenses and claims that have priority under that
subsection, to the extent compliance with section 4 of the
GENIUS Act would have required additional reserves to be
maintained by the permitted payment stablecoin issuer for
payment stablecoin holders.''.
(e) Payment Stablecoin Reserves.--Section 541(b) of title
11, United States Code, is amended--
(1) in paragraph (9), in the matter following subparagraph
(B), by striking ``or'' at the end;
(2) in paragraph (10)(C), by striking the period and
inserting ``; or''; and
(3) by inserting after paragraph (10) the following:
``(11) required payment stablecoin reserves under section 4
of the GENIUS Act, provided that notwithstanding the
exclusion of such reserves from the property of the estate,
section 362 of this title shall apply to such reserves.''.
(f) Intervention.--Section 1109 of title 11, United States
Code, is amended by adding at the end the following:
``(c) The Comptroller of the Currency or State payment
stablecoin regulator (as defined in section 2 of the GENIUS
Act) shall raise, and shall appear and be heard on, any
issue, including the protection of customers, in a case under
this chapter in which the debtor is a permitted payment
stablecoin issuer.''.
(g) Application of Existing Insolvency Law.--In accordance
with otherwise applicable law, an insolvency proceeding with
respect to a permitted payment stablecoin issuer shall occur
as follows:
(1) A depository institution (as defined in section 3 of
the Federal Deposit Insurance Act (12 U.S.C. 1813)) shall be
resolved by the Federal Deposit Insurance Corporation,
National Credit Union Administration, or State payment
stablecoin regulator, as applicable.
(2) A subsidiary of a depository institution (as defined in
section 3 of the Federal Deposit Insurance Act (12 U.S.C.
1813)) or a nonbank entity may be considered a debtor under
title 11, United States Code.
(h) Study by Primary Federal Payment Stablecoin
Regulators.--
(1) Study required.--The primary Federal payment stablecoin
regulators shall perform a study of the potential insolvency
proceedings of permitted payment stablecoin issuers,
including an examination of--
(A) existing gaps in the bankruptcy laws and rules for
permitted payment stablecoin issuers;
(B) the ability of payment stablecoin holders to be paid
out in full in the event a permitted payment stablecoin
issuer is insolvent; and
(C) the utility of orderly insolvency administration
regimes and whether any additional authorities are needed to
implement such regimes.
(2) Report.--Not later than 3 years after the date of
enactment of this Act, the primary Federal payment stablecoin
regulators shall submit to the Committee on Banking, Housing,
and Urban Affairs of the Senate and the Committee on
Financial Services of the House of Representatives a report
that contains all findings of the study under paragraph (1),
including any legislative recommendations.

SEC. 12. INTEROPERABILITY STANDARDS.

The primary Federal payment stablecoin regulators, in
consultation with the National Institute of Standards and
Technology, other relevant standard-setting organizations,
and State bank and credit union regulators, shall assess and,
if necessary, may, pursuant to section 553 of title 5, United
States Code, and in a manner consistent with the National
Technology Transfer and Advancement Act of 1995 (Public Law
104-113), prescribe standards for permitted payment
stablecoin issuers to promote compatibility and
interoperability with--
(1) other permitted payment stablecoin issuers; and
(2) the broader digital finance ecosystem, including
accepted communications protocols and blockchains,
permissioned or public.

SEC. 13. RULEMAKING.

(a) In General.--Not later than 1 year after the date of
enactment of this Act, each primary Federal payment
stablecoin regulator, the Secretary of the Treasury, and each
State payment stablecoin regulator shall promulgate
regulations to carry out this Act through appropriate notice
and comment rulemaking.
(b) Coordination.--Federal payment stablecoin regulators,
the Secretary of the Treasury, and State payment stablecoin
regulators should coordinate, as appropriate, on the issuance
of any regulations to implement this Act.
(c) Report Required.--Not later than 180 days after the
effective date of this Act, each Federal banking agency shall
submit to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on Financial Services
of the House of Representatives a report that confirms and
describes the regulations promulgated to carry out this Act.

SEC. 14. STUDY ON NON-PAYMENT STABLECOINS.

(a) Study by Treasury.--
(1) Study.--The Secretary of the Treasury, in consultation
with the Board, the Comptroller, the Corporation, the
Securities and Exchange Commission, and the Commodity Futures
Trading Commission shall carry out a study of non-payment
stablecoins, including endogenously collateralized payment
stablecoins.
(2) Report.--Not later than 365 days after the date of the
enactment of this Act, the Secretary of the Treasury shall
provide to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on Financial Services
of the House of Representatives a report that contains all
findings made in carrying out the study under paragraph (1),
including an analysis of--
(A) the categories of non-payment stablecoins, including
the benefits and risks of technological design features;
(B) the participants in non-payment stablecoin
arrangements;
(C) utilization and potential utilization of non-payment
stablecoins;
(D) the nature of reserve compositions;
(E) types of algorithms being employed;
(F) governance structure, including aspects of
decentralization;
(G) the nature of public promotion and advertising; and
(H) the clarity and availability of consumer notices
disclosures.
(3) Classified annex.--A report under this section may
include a classified annex, if applicable.
(b) Endogenously Collateralized Payment Stablecoin
Defined.--In this section, the term ``endogenously
collateralized payment stablecoin'' means any digital asset--
(1) the originator of which has represented will be
converted, redeemed, or repurchased for a fixed amount of
monetary value; and
(2) that relies solely on the value of another digital
asset created or maintained by the same originator to
maintain the fixed price.

SEC. 15. REPORTS.

(a) Annual Reporting Requirement.--Beginning on the date
that is 1 year after the date of enactment of this Act, and
annually thereafter, the primary Federal payment stablecoin
regulators, in consultation with State payment stablecoin
regulators, as necessary, shall submit to the Committee on
Banking, Housing, and Urban Affairs of the Senate, the
Committee on Financial Services of the House of
Representatives, and the Director of the Office of Financial
Research a report, which may include a classified annex, if
applicable, on the status of the payment stablecoin industry,
including--
(1) a summary of trends in payment stablecoin activities;
(2) a summary of the number of applications for approval as
a permitted payment stablecoin issuer under section 5,
including aggregate approvals and rejections of applications;
and
(3) a description of the potential financial stability
risks posed to the safety and soundness of the broader
financial system by payment stablecoin activities.
(b) FSOC Report.--The Financial Stability Oversight Council
shall incorporate the findings in the report under subsection
(a) into the annual report of the Council required under
section 112(a)(2)(N) of the Financial Stability Act of 2010
(12 U.S.C. 5322(a)(2)(N)).

SEC. 16. AUTHORITY OF BANKING INSTITUTIONS.

(a) Rule of Construction.--Nothing in this Act may be
construed to limit the authority of a depository institution,
Federal credit union, State credit union, national bank, or
trust company to engage in activities permissible pursuant to
applicable State and Federal law, including--

[[Page H3417]]

(1) accepting or receiving deposits or shares (in the case
of a credit union), and issuing digital assets that represent
those deposits or shares;
(2) utilizing a distributed ledger for the books and
records of the entity and to effect intrabank transfers; and
(3) providing custodial services for payment stablecoins,
private keys of payment stablecoins, or reserves backing
payment stablecoins.
(b) Regulatory Review.--Entities regulated by the primary
Federal payment stablecoin regulators are authorized to
engage in the payment stablecoin activities and investments
contemplated by this Act, including acting as a principal or
agent with respect to any payment stablecoin and payment of
fees to facilitate customer transactions. The primary Federal
payment stablecoin regulators shall review all existing
guidance and regulations, and if necessary, amend or
promulgate new regulations and guidance, to clarify that
regulated entities are authorized to engage in such
activities and investments.
(c) Treatment of Custody Activities.--The appropriate
Federal banking agency, the National Credit Union
Administration (in the case of a credit union), and the
Securities and Exchange Commission may not require a
depository institution, national bank, Federal credit union,
State credit union, or trust company, or any affiliate
thereof--
(1) to include digital assets held in custody that are not
owned by the entity as a liability on the financial statement
or balance sheet of the entity, including payment stablecoin
custody or safekeeping activities; or
(2) to hold in custody or safekeeping regulatory capital
against digital assets and reserves backing such assets
described in section 4(a)(1)(A), except as necessary to
mitigate against operational risks inherent in custody or
safekeeping services, as determined by--
(A) the appropriate Federal banking agency;
(B) the National Credit Union Administration (in the case
of a credit union);
(C) a State bank supervisor; or
(D) a State credit union supervisor.
(d) State-chartered Depository Institutions.--
(1) In general.--A depository institution chartered under
the banking laws of a State, that has a subsidiary that is a
permitted payment stablecoin issuer, may engage in the
business of money transmission or provide custodial services
through the permitted payment stablecoin issuer in any State
if such State-chartered depository institution is--
(A) required by the laws or regulations of the home State
to establish and maintain adequate liquidity, and such
liquidity is regularly reassessed by the home State banking
supervisor to take into account any changes in the financial
condition and risk profile of the institution, including any
uninsured deposits maintained by such institution; and
(B) required by the laws or regulations of the home State
to establish and maintain adequate capital, and such capital
is regularly reassessed by the home State banking supervisor
to take into account any changes in the financial condition
and risk profile of the institution, including any uninsured
deposits maintained by such institution.
(2) Rule of construction.--Nothing in this section shall
limit, or be construed to limit, the authority of a host
State bank regulator, to perform examinations of a depository
institution's subsidiary permitted payment stablecoin issuer
or activities conducted through the permitted payment
stablecoin issuer to ensure compliance with host State
consumer protection laws that the host State bank regulator
has specific jurisdiction to enforce, which shall apply to
such institution consistent with section 7(f).
(e) Definitions.--In this section:
(1) Home state.--The term ``home State'' means the State by
which the depository institution is chartered.
(2) Host state.--The term ``host State'' means a State in
which a depository institution establishes a branch, solicits
customers, or otherwise engages in business activities, other
than the home State.

SEC. 17. AMENDMENTS TO CLARIFY THAT PAYMENT STABLECOINS ARE
NOT SECURITIES OR COMMODITIES AND PERMITTED
PAYMENT STABLECOIN ISSUERS ARE NOT INVESTMENT
COMPANIES.

(a) Investment Advisers Act of 1940.--Section 202(a)(18) of
the Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)(18))
is amended by adding at the end the following: ``The term
`security' does not include a payment stablecoin issued by a
permitted payment stablecoin issuer, as such terms are
defined in section 2 of the GENIUS Act.''.
(b) Investment Company Act of 1940.--The Investment Company
Act of 1940 (15 U.S.C. 80a-1 et seq.) is amended
(1) in section 2(a)(36) of the Act (15 U.S.C. 80a-
2(a)(36)), by adding at the end the following: ``The term
`security' does not include a payment stablecoin issued by a
permitted payment stablecoin issuer, as such terms are
defined in section 2 of the GENIUS Act.''; and
(2) in section 3(c)(3) of the Act (15 U.S.C. 80a-3(c)(3)),
by inserting ``any permitted payment stablecoin issuer, as
such term is defined in section 2 of the GENIUS Act;'' after
``therefor;''.
(c) Securities Act of 1933.--Section 2(a)(1) of the
Securities Act of 1933 (15 U.S.C. 77b(a)(1)) is amended by
adding at the end the following: ``The term `security' does
not include a payment stablecoin issued by a permitted
payment stablecoin issuer, as such terms are defined in
section 2 of the GENIUS Act.''.
(d) Securities Exchange Act of 1934.--Section 3(a)(10) of
the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(10)) is
amended by adding at the end the following: ``The term
`security' does not include a payment stablecoin issued by a
permitted payment stablecoin issuer, as such terms are
defined in section 2 of the GENIUS Act.''.
(e) Securities Investor Protection Act of 1970.--Section
16(14) of the Securities Investor Protection Act of 1970 (15
U.S.C. 78lll(14)) is amended by adding at the end the
following: ``The term `security' does not include a payment
stablecoin issued by a permitted payment stablecoin issuer,
as such terms are defined in section 2 of the GENIUS Act.''.
(f) Commodity Exchange Act.--Section 1a(9) of the Commodity
Exchange Act (7 U.S.C. 1a(9)) is amended by adding at the end
the following: ``The term `commodity' does not include a
payment stablecoin issued by a permitted payment stablecoin
issuer, as such terms are defined in section 2 of the GENIUS
Act.''.

SEC. 18. EXCEPTION FOR FOREIGN PAYMENT STABLECOIN ISSUERS AND
RECIPROCITY FOR PAYMENT STABLECOINS ISSUED IN
OVERSEAS JURISDICTIONS.

(a) In General.--The prohibitions under section 3 shall not
apply to a foreign payment stablecoin issuer if all of the
following apply:
(1) The foreign payment stablecoin issuer is subject to
regulation and supervision by a foreign payment stablecoin
regulator of a foreign country, a territory of the United
States, Puerto Rico, Guam, American Samoa, or the Virgin
Islands that has a regulatory and supervisory regime with
respect to payment stablecoins that the Secretary of the
Treasury determines, pursuant to subsection (b), is
comparable to the regulatory and supervisory regime
established under this Act, including, in particular, the
requirements under section 4(a).
(2) The foreign payment stablecoin issuer is registered
with the Comptroller pursuant to subsection (c).
(3) The foreign payment stablecoin issuer holds reserves in
a United States financial institution sufficient to meet
liquidity demands of United States customers, unless
otherwise permitted under a reciprocal arrangement
established pursuant to subsection (d).
(4) The foreign country in which the foreign payment
stablecoin issuer is domiciled and regulated is not subject
to comprehensive economic sanctions by the United States or
in a jurisdiction that the Secretary of the Treasury has
determined to be a jurisdiction of primary money laundering
concern.
(b) Treasury Determination.--
(1) In general.--The Secretary of the Treasury may make a
determination as to whether a foreign country has a
regulatory and supervisory regime that is comparable to the
requirements established under this Act, including the
requirements under section 4(a). The Secretary of the
Treasury may make such a determination only upon a
recommendation from each other member of the Stablecoin
Certification Review Committee. Prior to such determination
taking effect, the Secretary of the Treasury shall publish in
the Federal Register a justification for such determination,
including how the foreign country's regulatory and
supervisory regime is comparable to the requirements
established under this Act, including the requirements under
section 4(a).
(2) Request.--A foreign payment stablecoin issuer or a
foreign payment stablecoin regulator may request from the
Secretary of the Treasury a determination under paragraph
(1).
(3) Timing for determination.--If a foreign payment
stablecoin issuer or foreign payment stablecoin regulator
requests a determination under paragraph (2), the Secretary
of the Treasury shall render a decision on the determination
not later than 210 days after the receipt of a substantially
complete determination request.
(4) Rescission of determination.--
(A) In general.--The Secretary of the Treasury may, in
consultation with the Federal payment stablecoin regulators,
rescind a determination made under paragraph (1), if the
Secretary determines that the regulatory regime of such
foreign country is no longer comparable to the requirements
established under this Act. Prior to such rescission taking
effect, the Secretary of the Treasury shall publish in the
Federal Register a justification for the rescission.
(B) Limited safe harbor.--If the Secretary of the Treasury
rescinds a determination pursuant to subparagraph (A), a
digital asset service provider shall have 90 days before the
offer or sale of a payment stablecoin issued by the foreign
payment stablecoin issuer that is the subject of the
rescinded determination shall be in violation of section 3.
(5) Public notice.--The Secretary of the Treasury shall
keep and make publicly available a current list of foreign
countries for which a determination under paragraph (1) has
been made.
(6) Rulemaking.--Not later than 1 year after the date of
enactment of this Act, the Secretary of the Treasury shall
issue such

[[Page H3418]]

rules as may be required to carry out this section.
(c) Registration and Ongoing Monitoring.--
(1) Registration.--
(A) In general.--A foreign payment stablecoin issuer may
offer or sell payment stablecoins using a digital asset
service provider if the foreign payment stablecoin issuer is
registered with the Comptroller.
(B) Registration approval.--A registration of a foreign
payment stablecoin issuer filed in accordance with this
section shall be deemed approved on the date that is 30 days
after the date the Comptroller receives the registration,
unless the Comptroller notifies the foreign payment
stablecoin issuer in writing that such registration has been
rejected.
(C) Standards for rejection.--In determining whether to
reject a foreign payment stablecoin issuer's registration,
the Comptroller shall consider
(i) the final determination of the Secretary of the
Treasury under this section;
(ii) the financial and managerial resources of the United
States operations of the foreign payment stablecoin issuer;
(iii) whether the foreign payment stablecoin issuer will
provide adequate information to the Comptroller as the
Comptroller determines is necessary to determine compliance
with this Act;
(iv) whether the foreign payment stablecoin presents a risk
to the financial stability of the United States; and
(v) whether the foreign payment stablecoin issuer presents
illicit finance risks to the United States.
(D) Procedure for appeal.--If the Comptroller rejects a
registration, not later than 30 days after the date of
receipt of such rejection, the foreign payment stablecoin
issuer may appeal the rejection by notifying the Comptroller
of the request to appeal.
(E) Rulemaking.--Pursuant to section 13 of this Act, the
Comptroller shall issue rules relating to the standards for
approval of registration requests and the process for
appealing denials of such registration requests.
(F) Public notice.--The Comptroller shall keep and make
publicly available a current list of foreign payment
stablecoin issuer registrations that have been approved.
(2) Ongoing monitoring.--A foreign payment stablecoin
issuer shall
(A) be subject to reporting, supervision, and examination
requirements as determined by the Comptroller; and
(B) consent to United States jurisdiction relating to the
enforcement of this Act.
(3) Lack of compliance.--
(A) Comptroller action.--The Comptroller may, in
consultation with the Secretary of the Treasury, rescind
approval of a registration of a foreign payment stablecoin
issuer under this subsection if the Comptroller determines
that the foreign payment stablecoin issuer is not in
compliance with the requirements of this Act, including for
maintaining insufficient reserves or posing an illicit
finance risk or financial stability risk. Prior to such
rescission taking effect, the Comptroller shall publish in
the Federal Register a justification for the rescission.
(B) Secretary action.--The Secretary of the Treasury, in
consultation with the Comptroller, may revoke a registration
of a foreign payment stablecoin issuer under this subsection
if the Secretary determines that reasonable grounds exist for
concluding that the foreign payment stablecoin issuer
presents economic sanctions evasion, money laundering, or
other illicit finance risks, or, as applicable, violations,
or facilitation thereof.
(d) Reciprocity.--
(1) In general.--The Secretary of the Treasury may create
and implement reciprocal arrangements or other bilateral
agreements between the United States and jurisdictions with
payment stablecoin regulatory regimes that are comparable to
the requirements established under this Act. The Secretary of
the Treasury shall consider whether the jurisdiction's
requirements for payment stablecoin issuers include
(A) similar requirements to those under section 4(a);
(B) adequate anti-money laundering and counter-financing of
terrorism program and sanction compliance standards; and
(C) adequate supervisory and enforcement capacity to
facilitate international transactions and interoperability
with United States dollar-denominated payment stablecoins
issued overseas.
(2) Publication.--Not later than 90 days prior to the entry
into force of any arrangement or agreement under paragraph
(1), the Secretary of the Treasury shall publish the
arrangement or agreement in the Federal Register.
(3) Completion.--The Secretary of the Treasury should
complete the arrangements under this subsection not later
than the date that is 2 years after the date of enactment of
this Act.

SEC. 19. DISCLOSURE RELATING TO PAYMENT STABLECOINS.

Section 13104(a)(3) of title 5, United States Code, is
amended, in the first sentence, by striking ``, or any
deposits'' and inserting ``, any payment stablecoins issued
by a permitted payment stablecoin issuer aggregating $5,000
or less held, or any deposits''.

SEC. 20. EFFECTIVE DATE.

This Act, and the amendments made by this Act, shall take
effect on the earlier of
(1) the date that is 18 months after the date of enactment
of this Act; or
(2) the date that is 120 days after the date on which the
primary Federal payment stablecoin regulators issue any final
regulations implementing this Act.

The SPEAKER pro tempore. The bill shall be debatable for 1 hour,
equally divided and controlled by the chair and ranking minority member
of the Committee on Financial Services or their respective designees.
The gentleman from Arkansas (Mr. Hill) and the gentlewoman from
California (Ms. Waters) each will control 30 minutes.
The Chair recognizes the gentleman from Arkansas.

General Leave

Mr. HILL of Arkansas. Mr. Speaker, I ask unanimous consent that all
Members may have 5 legislative days in which to revise and extend their
remarks and include extraneous material on this bill.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Arkansas?
There was no objection.
Mr. HILL of Arkansas. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, I rise in strong support of the Senate GENIUS Act, and I
thank my colleague and longtime friend, Senator Bill Hagerty of
Tennessee, for his leadership in ushering this bipartisan bill through
the United States Senate.
Around the world, payment systems are undergoing an evolution. New
technologies are modernizing legacy infrastructure and unlocking
innovative solutions to improve efficiency, reduce costs, and expand
access to financial services.
Members of the House Financial Services Committee have long
recognized the promise of payment stablecoins and have worked since
2022 to establish a legislative framework.
Last Congress, under the leadership of former Chairman Patrick
McHenry of North Carolina, the committee passed the Clarity for Payment
Stablecoins Act of 2023. This bill provided for bank and nonbank
pathways for issuers to obtain regulatory approval, preserve State-
level oversight, and set standards for reserve composition, audits, and
sound risk management.
When the 119th Congress started in January, we picked up this effort.
In close coordination with the Senate Banking Committee and our base
legislation, our legislative work over the past 2 years has laid that
foundation for the progress made in both the House and the Senate.
Today, we have an opportunity to send stablecoin legislation to
President Trump's desk. This is a multi-Congress priority item, and it
ensures American competitiveness and strong guardrails for our
consumers. We should not, Mr. Speaker, squander that opportunity.
This priority has been agreed to by both President Biden, with his
executive order, and President Trump in his Executive Order 14178.

{time} 1040

Mr. Speaker, through multiple versions of stablecoin legislation, the
House and Senate have shared ideas and crafted workable approaches. Our
joint efforts before us helped enhance the legislation on the floor
this morning.
I recognize the hard work of my friends in the Senate to get the core
fundamentals of what payment stablecoin legislation demands.
I also recognize the diligence and thoughtful work of my colleagues
here in the House, including the chairman of our Subcommittee on
Digital Assets, Financial Technology, and Artificial Intelligence,
Bryan Steil, who championed and worked through our committee through
markup in successfully designing, writing, and passing in committee the
STABLE Act.
I thank my House colleagues for their principled approach to key
policies that guided and distinguished our efforts particularly around
State regime oversight, the reserve composition, the anti-money
laundering, and territorial integrity issues around stablecoins, and,
finally, the corporate structure of issuers.
Furthermore, it is my firmly held belief that only by enacting
payment stablecoin legislation and, Mr. Speaker, I repeat, and
comprehensive market structure reform in this Congress, like we just
debated a few minutes ago, the

[[Page H3419]]

CLARITY Act, only by passing both will this Congress fully usher in the
era of digital finance and ensure that consumers are protected whenever
they engage with digital assets.
Mr. Speaker, I urge all my colleagues to join me in supporting this
bill and sending it forward to 1600 Pennsylvania Avenue for President
Trump to sign into law.
Mr. Speaker, I reserve the balance of my time.
Ms. WATERS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, 2 weeks ago Republicans boasted about how they would
provide billionaires with tax cuts they don't need by stripping
healthcare from 17 million Americans, shuttering hospitals across the
country, and starving 12 million families, including millions of
children.
These billionaires are the same individuals who proudly gave millions
of dollars to President Trump's campaign. They literally bought votes
during the last election and even sponsored Stalinist military parades
to celebrate the President's birthday.
No one should be surprised that these same Republicans' next order of
business is to validate, legitimize, and endorse the Trump family's
corruption and efforts to sell the White House to the highest bidder.
S. 1582, the so-called GENIUS Act, establishes a woefully deficient
Federal framework for dollar-denominated payment stablecoins in the
United States. Stablecoins are a form of digitized private money.
Unlike other types of crypto, these coins claim to always maintain
their value, often one coin for $1.
Nevertheless, that promise of stability is precisely what causes
stablecoins to be subject to bank-like runs where the public rushes to
sell their stablecoins at the first whiff of instability, making a bit
of bad news into a full-blown financial crisis.
It was for this reason that when I was chairwoman of the committee, I
sought to create a Federal framework to oversee these stablecoins and
ensure that consumers are protected. I worked with the Biden
administration and former Republican Chairman Patrick Henry to craft
legislation.
We achieved that goal, and I posted that legislation earlier this
year. We wanted to create a strong Federal system to oversee this type
of crypto market that protected consumers, our national security, and
financial stability.
Unfortunately, the election of Donald Trump ended those bipartisan
efforts and brought a significant new challenge to stablecoins. That
challenge was the Trump family's brazen corruption using crypto to sell
access in exchange for official acts.
It just so happens that those stablecoins are one of the main
vehicles Trump is using to make his corrupt crypto billions. The Trump
family's crypto company, World Liberty Financial, launched a stablecoin
called USD1 in April.
Shortly after that, the Abu Dhabi-backed investment from MGX bought
$2 billion of Trump's coins to make an investment in Binance, a company
that had been under investigation for numerous legal violations. Trump
and his family will make tens of millions of dollars just on that
transaction from the interest earnings alone. That is Abu Dhabi's
money.
More concerning, by passing this bill, Congress will be telling the
world that Congress is okay with corruption, okay with foreign
companies buying influence, and okay with criminals buying Trump coins
to seek pardons and beneficial treatment.
Each of my colleagues surely can see how this is a blatant conflict
of interest. Democrats and the rest of America do, as well. It is why I
introduced the Stop TRUMP in Crypto Act, to ban the President, Vice
President, and Members of Congress from crypto corruption. If we do not
ban elected officials in S. 1582, including the President or Vice
President, from crypto corruption, each of us will be complicit.
Let me be clear on this point because there has been a lot of
misinformation. This bill has a policy statement that elected officials
like Members of Congress and Senators, as well as government officials,
cannot issue their own stablecoin.
Are my colleagues aware who Republicans did not ban? Get this
straight. The President and the Vice President are the only elected
officials that can have a crypto business. Why are the Republicans
protecting the President so he can make billions and billions more?
Don't just take my word for it. Earlier this week, Chairman Hill
confirmed this much in the Rules Committee. Anyone who says the bill
stops the President's company from issuing stablecoins is not telling
the truth.
Yet, even if we adopted such a ban, the GENIUS Act, sent over by the
Senate and apparently unable to be amended, is still bad public policy.
S. 1582 creates the appearance of a Federal framework for stablecoins,
but it does not provide the Federal Government with the full authority
it needs to ensure that all stablecoin issuers comply with the law.

The bill also creates risks for consumers who will be stuck in a
lengthy bankruptcy process if a stablecoin ever fails.
Additionally, it leaves the door open for foreign firms that present
a major national security threat, including targets of sanctions, all
to appease those in the Trump family's inner circle which has ties to
those shady entities.
Yes, I am talking about Tether, the foreign stablecoin issuer
everyone knows has been used in terrorist financing, organized crime
schemes, and other horrible acts but which the Secretary of Commerce
has close ties with.
Let me give one more example of why this bill is just bad for
America. The very heart of this bill is that stablecoins will, in fact,
be stable because they will be backed one to one with solid, safe
assets. I invite anyone to read the bill.
While some of the reserves are cash and short-term Treasury
securities, this bill allows for uninsured deposits. We already know
how dangerous these deposits are. When Silicon Valley Bank failed,
Circle, the largest stablecoin today, had $3 billion locked up in
uninsured deposits and needed the Federal Government to rescue it. That
isn't all.
A stablecoin issuer is also permitted to hold bitcoin as reserves.
That is because someone added language in this bill late in the night
that added new definitions and language to the bill.
The language allows for a stablecoin issuer to use any money received
under repurchase agreements that are a means of exchange currently
authorized or adopted by a foreign government.
Do my colleagues know what Trump's favorite strongman, the dictator
of El Salvador, adopted as a legal currency? He adopted bitcoin.

{time} 1050

This highly volatile cryptocurrency will now be eligible to be a
reserve backing your stablecoins. It is truly absurd and dangerous and
will lead to consumers losing their money and the taxpayers being
called on to bail out the financial system.
It is for all of these reasons that I submitted several amendments to
this bill, none of which were made in order by Republicans, because the
President has rejected any conflict of interest language that binds
him.
One interesting point is that even Chairman Hill himself inserted
language at the end of the so-called CLARITY Act that the House is
separately considering this week that actually amends the GENIUS Act.
Mr. Speaker, you heard me right. Rather than amend the GENIUS Act,
which our own chairman saw had problems, he put his changes at the end
of the CLARITY Act.
Mr. Speaker, you may be asking why he would do that. He could just
offer his amendments to the GENIUS Act. The reason is that House
Republican leadership has given up our power as the United States House
of Representatives to work the will of our Members on behalf of our
constituents and make changes to any legislation that the Senate sends
us. Instead, we are simply taking the language directly from the Senate
with no amendments, even when the chairman and other House Members know
that this bill is flawed.
Unfortunately, because President Trump demanded the bill be passed
without any changes, that is what the Republican Congress will do.
One of Chairman Hill's changes to the GENIUS Act addresses a key
concern I have had from the beginning, which is that Facebook and any
other Big Tech company should not be allowed to issue their own
stablecoin.

[[Page H3420]]

That would violate a longstanding separation of banking and commerce in
financial regulation, and our chairman's amended language would help
close this loophole.
Unfortunately, the GENIUS Act allows Elon Musk's X to issue its own
stablecoin and creates a pathway for Facebook to do the same.
For these reasons and many more, I strongly oppose this bill.
Mr. Speaker, I reserve the balance of my time.
The SPEAKER pro tempore (Mr. Patronis). Members are reminded to
refrain from engaging in personalities toward the President.
Mr. HILL of Arkansas. Mr. Speaker, I yield myself such time as I may
consume. I would like to address a few of those points.
One, I am so delighted to hear that it sounds as if my friend, the
ranking member from California, in fact, will now vote for the CLARITY
Act this afternoon on the House floor since she highlights some of my
suggested changes to the GENIUS Act. I appreciate her remarks on that.
Here is the big picture, Mr. Speaker. These bills, the CLARITY and
GENIUS Acts, are about protecting American consumers, protecting
investments, bringing capital back to the United States, and making the
U.S. a fintech leader in payments and digital assets.
Consumers are protected. The rules are straightforward. All issuers
of a payment stablecoin are treated the same, with high standards and
high regulatory oversight. I want to make sure that those at home
following on C-SPAN get the record straight.
Mr. Speaker, I yield 1 minute to the gentleman from Pennsylvania (Mr.
Thompson), who is the chair of the House Agriculture Committee and who,
for years, has been a partner in crafting a digital asset approach that
will make America more competitive.
Mr. THOMPSON of Pennsylvania. Mr. Speaker, I am proud to stand before
Chairman Hill and support the GENIUS Act. It actually garnered 68
bipartisan votes in the Senate. I appreciate those Senators. They
demonstrated an awareness of the needs of a modern financial sector
here in the United States. I congratulate Chairman Hill and Chairman
Steil and thank them for their work on the stablecoin legislation.
The GENIUS Act represents an important step for this Congress in
establishing the United States as a leader in the digital asset space.
This legislation, together with the market structure bill that we
previously considered, which I have had the honor of cosponsoring with
my colleagues on the Financial Services Committee, will provide
important safeguards around the utility of vital digital assets in the
next generation of global finance.
Furthermore, Mr. Speaker, I intend to submit additional remarks for
the Record to clarify congressional intent on the effect the bill may
have on the ability to list certain derivative products.
Mr. THOMPSON. Mr. Speaker, additionally, I would further state the
following understanding with respect to the ability to offer listed
derivatives products on payment stablecoins.
By excluding ``payment stablecoins'' from the definition of
``commodity'' in Sec. 1a(9) of the Commodity Exchange Act (7 U.S.C. 1a
et seq.) Congressional intent was not to extend Commodity Futures
Trading Commission's (``CFTC'') jurisdiction over ``payment
stablecoins'' and leaving this jurisdictional reach only for
appropriate State and Federal payment stablecoin regulators. However,
in the event that a derivative market on payment stablecoins develops,
such exclusion of ``payment stablecoins'' from ``commodity'' would not
affect the regulatory status under the CEA of certain derivative
instruments based on ``payment stablecoins'' issued under the GENIUS
Act, such as ``swaps'' as defined in Sec. 1a(47) of the CEA. For
example, registered designated contract markets (``DCMs''), i.e.,
commodity exchanges, and swap execution facilities (``SEFs'') could
list for trading swaps on payment stablecoins and make them available
for retail and professional participants to allow them to hedge and
mitigate their commercial risks and exposure to potential market price
fluctuations of ``payment stablecoins.''
Because ``swaps'' are qualified as ``commodity interests'' under
Sec. 1.3 of CFTC regulations (17 C.F.R. 1, et seq.), CFTC will have
jurisdiction to police fraud, manipulation, insider trading and other
market violations and to otherwise ensure customer protection of retail
participants if a derivative market in payment stablecoin swaps
develops in the U.S. or overseas and becomes available to U.S. persons.
Ms. WATERS. Mr. Speaker, I yield 3 minutes to the gentleman from
Massachusetts (Mr. Lynch), who is also the ranking member of the
Subcommittee on Digital Assets, Financial Technology, and Artificial
Intelligence.
Mr. LYNCH. Mr. Speaker, I thank the gentlewoman for yielding.
Mr. Speaker, I rise in strong opposition to the so-called GENIUS Act.
Mr. Speaker, this bill has never even been considered or debated by
the House Financial Services Committee or the Agriculture Committee,
the committees of jurisdiction, which is the usual practice in this
body. I guess this is what passes for genius these days.
Republican leadership has, once again, caved in to President Trump's
demands to quickly push crypto legislation.
President Trump just yesterday posted to pass the GENIUS Act ASAP.
There is no need to debate it, read it, or amend it. Just pass it.
Mr. Speaker, you might think that Republicans might be cautious about
taking financial policy directions from someone who has a side hustle
selling baseball hats and Bibles and who has filed bankruptcy six times
in the past 20 years. Sadly, Mr. Speaker, you would be mistaken.
This bill significantly weakens the U.S. dollar, which is the global
U.S. reserve currency and provides a huge competitive advantage for our
country.
This bill allows a complete takeover of our financial system by Big
Tech companies by allowing these massive companies to issue their own
cryptocurrencies.
For example, Google has 3.5 billion daily users, and META has over 2
billion active daily users, not to mention Amazon, X, or Walmart.
Several of these companies have already indicated they are planning to
launch crypto stablecoins if this bill becomes law. These companies can
easily compel or incentivize users to move away from the dollar, away
from traditional banks, and into these so-called stablecoins.
President Trump's own stablecoin is set to become one of the top 10
stablecoins after Abu Dhabi announced a $2 billion investment in World
Liberty Financial, which is a joint venture between the Trump family,
his sons, and Steve Witkoff and his family. You may recall, Mr.
Speaker, that Steve Witkoff is Trump's Special Envoy to the Middle
East, where Abu Dhabi is located.
Nothing in this bill prevents the clear conflicts of interest and
violations of ethics laws by President Trump.
The worst aspect of this bill is the danger and risk that it puts on
the backs of U.S. taxpayers because this will not end well, and nothing
in this bill prevents a taxpayer bailout of crypto. If we really wanted
to protect the taxpayer, we could require the crypto companies that are
pushing these bills to absorb the losses if they fail. That would seem
fair. Despite several attempts to have amendments included in this bill
that would protect the taxpayer from paying for crypto bailouts, my
Republican colleagues repeatedly refused.
We have seen in the past, in 2008, when the last version of financial
innovation blew up, the collateralized debt obligations and other
complex derivatives. It was the taxpayer who had to clean up that mess
to the tune of $700 billion, while the bankers who created the mess got
bonuses.
We should not let that happen again.
Mr. Speaker, I urge my friends on the other side and my colleagues on
our side to defend the U.S. taxpayer and vote ``no'' on this bill.
The SPEAKER pro tempore. Members are reminded to refrain from
engaging in personalities toward the President.
Mr. HILL of Arkansas. Mr. Speaker, I really have to say that I
believe the GENIUS Act is an important component for preserving and
enhancing the United States dollar as the reserve currency around the
world.
Mr. Speaker, I yield 3 minutes to the gentleman from Minnesota (Mr.
Emmer), who is our majority whip and who has been instrumental in our
success in crafting digital asset legislation.

[[Page H3421]]

Mr. EMMER. Mr. Speaker, in November, the American people elected the
most pro-innovation and pro-crypto Congress and President in American
history. Following his historic victory, President Trump gave Congress
a mandate to pass landmark legislation to create rules of the road for
the digital asset ecosystem. The GENIUS Act is the first step in
fulfilling that promise.

{time} 1100

I applaud my Senate colleagues Chairman Scott and Senators Hagerty,
Lummis, and Gillibrand for energizing an often calcified Senate and
sending over the GENIUS Act. Furthermore, I thank my colleagues,
Speaker Johnson and Leader Scalise, along with Chairman Hill and
Chairman Thompson, for putting this bill on the House floor today for a
vote.
Fundamentally, any stablecoin bill is about national security. It is
about preserving and extending the dollar's dominance as the world's
reserve currency. People want to transact in dollars because we have
the strongest and most reliable economy and government in the world. It
is the currency the world counts on to do business, and the United
States' global position relies on that status.
The United States cannot afford to sit on the sidelines. If we fail
to lead in this space, we risk leaving the door open for authoritarian
regimes like China to advance its state-controlled digital currencies.
This bill is a globally competitive, regulatory framework for dollar-
backed stablecoins, one that encourages domestic innovation and brings
transaction volume back into the United States' visibility and under
our control.
As we saw over the last 4 years under the Biden administration,
regulation by enforcement not only created uncertainty but also pushed
companies offshore. A clear and defined stablecoin framework, like that
in the GENIUS Act, keeps these innovators here at home and brings back
all those who left.
This is not a perfect bill, but it is a perfect bill for this moment.
Congress must keep its eyes on the finish line and send the GENIUS Act
to President Trump's desk this week.
Bottom line: The GENIUS Act is a proinnovation, profreedom, and
progrowth piece of legislation. It is a bipartisan solution to a global
challenge, empowering U.S. markets to lead, not follow.
Let's pass this bill and secure American financial leadership in the
global digital economy. I encourage all my friends in this body to
unequivocally vote ``yes'' on this bill.
Ms. WATERS. Mr. Speaker, I yield 3 minutes to the gentleman from
California (Mr. Sherman), who is also the ranking member of the
Subcommittee on Capital Markets.
Mr. SHERMAN. Mr. Speaker, it is customary, when we consider major
legislation, to give credit to those who created the bill. The ghost of
Sam Bankman-Fried looms above this auditorium. He is the genius behind
this GENIUS Act, and one can only hope that he is able to watch C-SPAN
on a black-and-white television set in his prison cell.
You don't have to be a genius to know that this bill is an attack on
working families. That is why the AFL-CIO says no, and they are scoring
it.
They call it stablecoin. It is not stable. It is not a coin. It is a
money market account that, under this law, must pay zero percent
interest. Who wants to forgo a 4 percent rate of return and get a zero
percent return in stablecoin? Those who are desperate for what
cryptocurrency offers.
Cryptocurrency literally means hidden money, and these stablecoins
are exempt from the anti-money laundering provisions. Thus, it meets
the needs perfectly of drug dealers, human traffickers, sanctions
evaders, those who are hiding assets from their former spouses, and tax
evaders.
Just to be clear, the Republicans rejected unanimously in committee a
provision to prevent mixers. Mixers are devices whose sole purpose is
to defeat even top law enforcement efforts pursuant to a warrant, and
under this bill mixers will be used to defeat law enforcement.
Republicans claim to be against crime in the streets, but they are
creating a device whose sole purpose is to facilitate crime in the
suites.
Page 43 of this bill contains a provision maintaining the eligibility
of stablecoins for bailouts under a facility created under section
13(3) of the Federal Reserve Act. Now, Jerome Powell won't bail out
stablecoin, but the next guy will.
Stablecoin marketers are going to tell investors that if they ever
have a problem they are going to get bailed out. After all, crypto has
all the power in Congress because it is the number one source of super-
PAC independent expenditures. Last year, crypto did more super-PAC
expenditures than Big Oil and Big Pharma times five.
This bill is designed to enrich President Donald Trump. Even Richard
Nixon never thought of printing up baskets of Monopoly money and
selling them for cash. Trump thought of it, and he is doing it
electronically.
Abu Dhabi has announced they are investing $2 billion in Trump
stablecoin, $2 billion in Trump's hands where he has to pay nothing,
zero percent, on the loan. He invests the money, makes $2 million a
week, up until Abu Dhabi demands its money back, which they are never
going to do as long as our foreign policy meets the needs of Abu Dhabi.
Republicans rejected unanimously an amendment to prevent taxpayer
money from being used to buy crypto. If you are voting for this bill,
you are voting for taxpayer money to go into buying Trump coin.
The SPEAKER pro tempore. Members are reminded to refrain from
engaging in personalities toward the President.
Mr. HILL of Arkansas. Mr. Speaker, I recognize the chair of our
Subcommittee on Digital Assets, Financial Technology, and Artificial
Intelligence, who crafted the STABLE Act, which is the base text that
led to this joint, good work between the House and Senate.
I yield 3 minutes to the gentleman from Wisconsin (Mr. Steil).
Mr. STEIL. Mr. Speaker, I rise in support of the GENIUS Act. The
legislation brings clarity, consumer protections, and American
leadership to the evolving world of payment stablecoins.
Stablecoin legislation has been in the works for over 4 years and has
been called for by Democratic and Republican administrations. The
status quo fails to protect consumers from fraud. That is an untenable
situation in a market growing by the billions.
For too long, the United States has operated without a clear Federal
framework for dollar-backed payment stablecoins, leaving consumers
vulnerable to fraud, innovators in limbo, and our global
competitiveness at risk.
That is why I am proud to have introduced stablecoin legislation in
the House and worked alongside my colleagues in the Senate to make the
legislation reaching the President's desk as strong as possible. That
is why I am urging a ``yes'' vote on the GENIUS Act.
The bipartisan, bicameral legislation creates a robust framework for
payment stablecoin issuance in the United States. It encourages the
innovation and development of Web3 businesses here in the United
States. It establishes clear rules to ensure that consumers are
protected and businesses have clear regulations to responsibly
participate in the digital asset ecosystem.
By requiring issuers to maintain a one-to-one reserve in cash and
high-quality liquid assets like U.S. Treasuries, consumers know what
they are getting and are protected.
GENIUS has strong anti-money laundering, operational risk, and
governance standards in place to prevent abuse, reinforce market
integrity, and create an even playing field with other financial
institutions.
By passing the GENIUS Act in the House and sending it to the
President's desk, Congress will be sending a clear message: The United
States will dominate the future of financial innovation. We will
protect consumers, support innovation, and defend the central role of
the U.S. dollar in global commerce.
With this bill, we are not just responding to a moment. We are
building a foundation for the future of finance in the Web3 world.
Payment stablecoin legislation is critical to this foundation. If we
want to become the digital asset hub of the world, we must enact a
comprehensive

[[Page H3422]]

framework for the digital asset ecosystem.
I urge my colleagues to support both the GENIUS Act and the CLARITY
Act and send a message that America leads in financial innovation and
does so with integrity, strength, and a firm commitment to protecting
the people we serve.
Ms. WATERS. Mr. Speaker, I yield 2 minutes to the gentleman from
Illinois (Mr. Casten), who is also the vice ranking member of the
Financial Services Committee.
Mr. CASTEN. Mr. Speaker, if I were to describe Jeffrey Epstein as a
nice family man who works in finance, you might question why I am
saying that. If someone says that something that is neither a coin nor
stable is a stablecoin, you might question why they are saying that
because they aren't stable.
Terra, which was a stablecoin, collapsed at 30 cents and wiped out
$40 billion in investor value. That was an algorithmic stablecoin. More
recently, as the ranking member has noted, USDC, a so-called
stablecoin, fell to 88 cents and only exists today because taxpayers
bailed them out.
These are some of the reasons why central bankers last week issued a
warning that stablecoins threaten global financial stability and need a
much more restrictive regime compared to traditional finance.

{time} 1110

The GENIUS Act ignores all of those experts and, instead, ties
stablecoins into our financial system but without the safeguards that
are required by banks and investment companies.
As the ranking member noted, this allows Big Tech companies to issue
stablecoins and amass consumer data at the same time we are gutting the
Consumer Financial Protection Bureau, which protects consumers.
It allows issuers to cherry-pick the lightest-touch regulator between
the Federal Government and any of the 50 States.
Rather than fixing the problems created when Silicon Valley Bank
collapsed, it makes them worse by saying that you can have uninsured
deposits. Yet, if there is a run on a future Silicon Valley Bank, the
stablecoin issuers have a superior claim over every single person in
this room who has a legitimate deposit in that bank.
My colleagues have said that this has a one-to-one requirement,
except that it is not audited. There is only an audit requirement for
companies over $50 billion in assets, which is only two stablecoins.
Donald Trump's stablecoin just has to say that they attest that there
was value in there on the 30th day of the month, and we don't have an
auditor. That isn't one-to-one certification.
Finally, the GENIUS Act is a missed opportunity to limit foreign
influence. We know that, recently, a convicted money launderer wrote
the code so that the United Arab Emirates could buy $2 billion of
Trump's stablecoin, which allowed President Trump to earn $30 million
on the transaction.
Now, this convicted felon--
The SPEAKER pro tempore. The time of the gentleman has expired.
Ms. WATERS. Mr. Speaker, I yield an additional 15 seconds to the
gentleman from Illinois.
Mr. CASTEN. Mr. Speaker, I should clarify that the convicted felon I
am referring to is the guy who ends up trading--
The SPEAKER pro tempore. The time of the gentleman has again expired.
Ms. WATERS. Mr. Speaker, I yield an additional 15 seconds to the
gentleman from Illinois.
Mr. CASTEN. Mr. Speaker, the convicted felon I am referring to is the
guy who ran Binance and not the President, but he is seeking a
Presidential pardon.
Mr. Speaker, the GENIUS Act sets the stage for an exponential crisis
and allows the President to continue cheapening the office for his own
financial gain, and I urge a strong ``no.''
The SPEAKER pro tempore. Members are reminded to refrain from
engaging in personalities toward the President.
Mr. HILL of Arkansas. Mr. Speaker, I yield 1 minute to the gentleman
from Michigan (Mr. Huizenga), the vice chairman of our full committee.
Mr. HUIZENGA. Mr. Speaker, I thank the chairman for yielding me time.
Mr. Speaker, today is a good day for innovation. It is a good day for
free markets, entrepreneurs, and consumer choice. It is a good day for
American digital leadership.
Mr. Speaker, after years of debate and, frankly, as I was chair of
the Capital Markets Subcommittee in 2017 and 2018 and held hearings on
cryptoassets, Congress has finally recognized the unique nature of
stablecoin products.
Under this bill, we established a regulatory framework that targets
the activity, not the technology. After years of indecision, Americans
finally have an administration that is ready to embrace those products.
The time to reassert American leadership in the digital asset space is
now.
The GENIUS Act acknowledges that stablecoins can address
inefficiencies in the U.S. payment system. It acknowledges that
maintaining the U.S. dollar as the world's reserve currency should
always be at the forefront of any decision that we have. It
acknowledges that the private sector must lead the way, fostering
innovation and competition.
The SPEAKER pro tempore. The time of the gentleman has expired.
Mr. HILL of Arkansas. Mr. Speaker, I yield an additional 15 seconds
to the gentleman from Michigan.
Mr. HUIZENGA. Mr. Speaker, I thank the chairman for yielding me
additional time.
Mr. Speaker, obviously, at the end of this, finally, it acknowledges
that a clear regulatory framework led by the United States is needed to
usher in this modern technology.
Mr. Speaker, we are at an inflection point. When it comes to digital
assets, I urge my colleagues to seize this moment by supporting this
important legislation.
Ms. WATERS. Mr. Speaker, I yield 2 minutes to the gentlewoman from
New York (Ms. Velazquez), who is also the ranking member of the
Committee on Small Business.
Ms. VELAZQUEZ. Mr. Speaker, I thank the gentlewoman for yielding.
Mr. Speaker, I rise today in opposition to the GENIUS Act.
From the beginning, I have said that Congress needs to tackle
stablecoin legislation, but we cannot pretend that this is happening in
a vacuum. We are creating a framework for stablecoins while the
President, his family, and members of his administration are personally
invested in this market and directly profiting from it.
Mr. Speaker, 3 days before taking office, President Trump launched
his own memecoin. When the coin's value collapsed, his insiders cashed
out. Everyday investors were left holding the bag. It is estimated that
they lost over $2 billion while the Trump circle walked away with more
than $350 million.
Now, his family firm, World Liberty Financial, has launched its own
stablecoin, once again netting the President's family tens of millions
of dollars.
The administration is rolling back enforcement and reshaping policy
to give these business interests a leg up.
These are such clear-cut conflicts of interest, yet this bill does
nothing to address them. It doesn't bar the President or Cabinet
officials from holding financial stakes in stablecoin issuers. It
doesn't address the foreign investors piling into these ventures. It
doesn't even try to draw a line between public office and private
banks.

This isn't a framework for innovation. It is a framework for more
corruption.
If we are serious about protecting consumers and about protecting our
markets, we have to start with ethics. This bill fails that basic test.
Mr. Speaker, I urge my colleagues to vote ``no.''
Mr. HILL of Arkansas. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, this bill, the GENIUS Act, and the bill we debated a few
minutes ago, the CLARITY Act, are all about consumer protection. There
are no rules federally across the board in the digital asset space at
all now. That is why we have seen consumers hurt by the lack of a
regulatory framework. I have to say, Mr. Speaker, in total contrast to
my friends on the other side of the aisle, that is what we are all here
for today.
Mr. Speaker, I appreciate your continuing reminder to the Members in
the Chamber to refrain from engaging

[[Page H3423]]

in personalities. Yet it has routinely become a part of our morning, so
I have to inquire as to how long we are going to let this go on, Mr.
Speaker. I want to make sure all the Members in the Chamber adhere to
rule XVII.
Mr. Speaker, I yield 4 minutes to the gentleman from Kentucky (Mr.
Barr), our distinguished chairman who leads our Subcommittee on
Financial Institutions.
Mr. BARR. Mr. Speaker, I thank the chairman for yielding me time.
Mr. Speaker, I rise today in strong support of the passage of the
GENIUS Act, and I thank Chairman Hill for his extraordinary leadership,
not just in this Congress, but for a long time advocating for this
moment. He deserves a tremendous amount of credit for persevering and
working and marshaling bipartisan, bicameral support. I thank him for
his tremendous leadership.
I thank the gentleman from Wisconsin (Mr. Steil) for being a subject-
matter expert and working in a bipartisan way to build a bipartisan
coalition for this moment.
There has been a lot of talk, Mr. Speaker, made in this term of
Congress about the One Big Beautiful Bill Act. It is a historic piece
of legislation, no doubt. It is going to supercharge our economy. It is
jet fuel for our economy. They are the biggest tax cuts we have ever
seen in this country's history. Yet, I would argue, with all respect,
that, arguably, the most important and most transformational pieces of
legislation in this Congress are these bills that we are talking about
here today, the GENIUS Act and the CLARITY Act.
It is paramount that we send this historic piece of legislation, the
GENIUS Act, to the President's desk because this bill is the first of
its kind in creating a regulatory framework for the future of
stablecoin issuance in the United States to revolutionize finance and
payments in this country and around the globe.
Not only will this cement us, the United States, for decades to come
as leaders and innovators in the digital asset space, but it will,
importantly, protect the U.S. dollar's dominance and increase demand in
our Treasury market.
In the GENIUS Act, stablecoins become pegged to the U.S. dollar and
backed by high-quality liquid assets.
Mr. Speaker, in stark contrast to what my friend, the gentleman from
Illinois (Mr. Casten), was arguing, this actually prevents these other
so-called stablecoins from actually thriving in the marketplace.
You are going to have stablecoins that actually are stable. That is
why we need the bill. The gentleman from Illinois (Mr. Casten) is
actually making the argument for us. He is making the argument for why
he should support the GENIUS Act. It is because of unstable stablecoins
that are out there. Those products will lose ground in the marketplace
after we pass the GENIUS Act.

{time} 1120

It will ensure that consumers are protected while reaping the
benefits of blockchain technology. The GENIUS Act will allow for
scalability to occur in the stablecoin marketplace, ensuring American
consumers and businesses have access to this innovative product.
Both banks and nonbanks can issue stablecoins under the GENIUS Act,
bringing together the best actors in both the traditional finance space
and the new era of digital finance.
The GENIUS Act provides that all appropriately regulated banks,
including the U.S. operations of foreign banking organizations, which
are supervised by the Federal Reserve, are treated equally to their
U.S. peers.
This is particularly important with respect to the issuance, reserve
and custody services, and bank capital requirements irrespective of
whether they are deposit insured since the act prohibits stablecoins
from being covered by FDI insurance.
A robust, well-regulated stablecoin market eliminates any
justification for a government controlled Central Bank Digital
Currency, or CBDC, which jeopardizes Americans' access to freedom,
privacy, and apolitical private capital.
This is an important point for all of my colleagues on my side of the
aisle who share my concern and opposition to a CBDC. If you want to put
a dagger in the heart of this crazy surveillance state idea of a
Central Bank Digital Currency, pass this bill. I urge all Members to
vote for this bill, vote for the GENIUS Act, which will eliminate all
arguments for a CBDC.
With the GENIUS Act, we will increase the speed and decrease the cost
of payments. We will decrease and eliminate friction from our payment
system. If all Americans see housing their deposits via a CBDC at the
Federal Reserve as a risk-free proposition, they would be incentivized
to pull their money out of private-sector banks.
The Speaker pro tempore. The time of the gentleman has expired.
Mr. HILL of Arkansas. Mr. Speaker, I yield an additional 15 seconds
to the gentleman from Kentucky.
Mr. BARR. Just to conclude, we want to avoid eroding the deposit base
and starving the private sector of conventional bank financing. The
GENIUS Act will not erode the deposit base. It will allow banks to
issue and custody stablecoins and participate in this emerging crypto
economy cementing the dollar as the world's reserve currency,
protecting consumers and the deposit base, and supercharging the
Treasury market.
Ms. WATERS. Mr. Speaker, I yield 2 minutes to the gentleman from Ohio
(Mr. Davidson) who is the Republican chairman of the National Security
Subcommittee.
Mr. DAVIDSON. Mr. Speaker, I thank the ranking member for yielding.
Mr. Speaker, I have not seen a perfect bill since I have been in
Congress, but this is a pretty good bill. It is an important bill.
Regulating stablecoins is long overdue at the Federal level, but make
no mistake, stablecoins aren't new.
The New York Department of Financial Services has regulated
stablecoins in the State of New York since 2018. They are time-tested
and proven, and they have been stable.
It is long overdue for us to provide Federal legal clarity here, so
why am I speaking in opposition to it? My Republican colleagues are
exactly right about the stablecoins and the need for regulation. That
is why we passed the STABLE Act, but my Democratic colleagues are right
this time to recognize that the legislative process is broken and,
frankly, we all know that. Everyone in the House does.
We have seen it broken on lots of things, but here, today, we have
got a defective product that our legislative process prevented us from
fixing.
On the product, the GENIUS Act, we agree we have five amendments that
we want to do to the GENIUS Act that we are doing in the CLARITY Act,
and they are important. Frankly, while the GENIUS Act does address
retail CBDC, and it is an important concession because Democrats want a
surveillance state Central Bank Digital Currency.
Mr. Speaker, you are going to see that when we vote later on Tom
Emmer's bill. They want that. Republicans are thankfully united in
opposing Central Bank Digital Currency, but we should deal with that
fully here.
On March 8, 2023, in a dialogue with Chairman Hill, Federal Reserve
Chairman Jerome Powell said that they would need congressional approval
for a retail CBDC, but he went on to explain that you could have a
layered CBDC. They are building just that at the Federal Reserve.
We should completely turn that off, and that is why we need to pass
Representative Emmer's bill. I will talk about that later, but we also
need to protect self-custody, which is the ability for you to move your
money directly person to person without an intermediary. You won't have
direct access to your own money unless you protect it because
government agencies continue to try to ban it. We need to protect it.
We do in the CLARITY Act, and that is why I oppose the bill.
Mr. HILL of Arkansas. Mr. Speaker, I yield 1 minute to the gentleman
from Pennsylvania (Mr. Meuser), the chairman of our Oversight and
Investigations Subcommittee.
Mr. MEUSER. Mr. Speaker, I rise today in strong support of S. 1582,
the GENIUS Act. I thank the chairman of our full Financial Services
Committee, Chairman Hill, for his leadership; Chairman Steil for his
great work; Whip Emmer, and so many in our committee and our colleagues
in the Senate for their work on this legislation.
I also recognize President Trump's administration, crypto czar David
Sacks, and SEC Chair Paul Atkins for

[[Page H3424]]

their efforts to reverse the Biden-era irrational opposition and
misguided regulations that we lived with for 4 years toward innovation
and now we are setting America back on a progrowth America First
course.
Mr. Speaker, the Senate's legislation built on 2 years of groundwork
by the House, crafting a framework for stablecoins that protects
consumers, the dollar, and unleashes private-sector innovation. This
bill achieves three goals. It supports the dollar's role as the world's
reserve currency. It provides a private-sector alternative to a
government-run digital dollar which is very important, and it
modernizes payments to reduce costs and expand access. This is smart,
forward-looking policy.

Mr. Speaker, I urge my colleagues to support it.
Ms. WATERS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, since assuming office, President Trump has been making
himself richer and richer, while working-class Americans are struggling
just to stay afloat.
President Trump has earned $1.2 billion since he entered office. The
Trump family has been using the Office of the Presidency, and the way
that they are doing this is extremely alarming to me and my fellow
Democrats.
Now, let me go through this timeline once more.
In September 2024, on the campaign trail, the Trump family launched
World Liberty Financial, which they have described as a decentralized
finance, or DeFi company.
On January 17, 2 days before the Presidential inauguration, President
Donald Trump launched his Trump memecoin. Days later, Melania Trump
launched her memecoin.
On March 25, 2025, World Liberty Financial launched a dollar-pegged
stablecoin just 1 week before the House Financial Services Committee
marked up stablecoin legislation and 2 weeks after Senate colleagues
held their markup.
On March 31, Eric Trump and Donald Trump, Jr.'s, American data
centers merged with American bitcoin, a bitcoin mining operation.
On July 8, Trump Media and Technology Group, the company that
operates the Truth Social media platform, announced that it had filed
paperwork with the SEC to approach to launch the crypto blue chip ETF
later this year.
Now, let's add all of this up.
Since January of this year, President Trump and his family have
launched or are planning to launch six different crypto ventures.
Congressional Republicans and the crypto industry will state that these
conflicts of interest take away from the discussion on other parts of
the bill. They claim that this bill is good for consumers and
investors.
Well, let me tell you, it is not. It is good for Trump's family and
wealthy crypto investors that can afford to see themselves through an
FTX-type collapse. No one, not a Republican or a Democrat, should be
using their office to make themselves richer while everyday Americans
are struggling to buy groceries and pay for their healthcare.
Everyday Americans are simply trying to survive, thanks to Republican
policies, while President Trump and his billionaire boys' club thrive
in the economy.
It is simple. People want to know why Members of Congress can't
simply exclude the President and the Vice President. Why do they keep
them in both of the bills as owners of crypto? Why did they avoid my
amendment that would take them out?
I don't believe that the President, the Vice President, his Cabinet,
his family, or any Members of Congress should be owners of crypto. I
certainly don't believe that the Office of the Presidency should be
used by anybody, any President, now or in the future, to be the owners
of crypto.
Mr. Speaker, I reserve the balance of my time.

{time} 1130

Mr. HILL of Arkansas. Mr. Speaker, I yield 2 minutes to the gentleman
from Nebraska (Mr. Flood), who chairs our Subcommittee on Housing and
Insurance.
Mr. FLOOD. Mr. Speaker, I have been working on this since I was in
the Nebraska Legislature. Back in 2021, I passed the Nebraska Financial
Innovation Act, making our State the second State to allow State-
chartered banks to custody digital assets, stablecoins.
These stablecoins have the ability to greatly increase not only the
speed of payments and settlements, but also make our economic system
even more efficient. Stablecoins will also support the advancement of
the U.S. dollar around the globe.
We may often take it for granted, but most of the transactions around
the globe rely on a currency backed by the U.S. dollar. That could
change if we don't adopt laws like this.
Who steps in? Adversaries like China.
We want to have a presence on the Continent of Africa. That is the
next frontier. This assures us of that.
In the early days, caution was certainly prudent. Stablecoins are a
novel technology with significant questions regarding how to protect
consumers, like what happens in the event of bankruptcy and how to
ensure that the issuers live up to the technology's namesake by
providing a truly stable asset, the dollar.
That is why we have been working on this issue in our committee for
the last several years. Similarly, the Senate has been running through
their process.
Let me be clear, this bill is not perfect. With my experience in
Nebraska, I have been a strident supporter of a strong, robust State
pathway for issuers. This bill has a State pathway, but it is capped at
a $10 billion asset threshold.
I personally much prefer Congressman Bryan Steil's STABLE Act to this
Senate product. However, despite my personal preferences, this bill
absolutely provides a comprehensive and safe Federal framework for
stablecoin regulation.
In order to usher in a new era of blockchain innovation, we need to
pass the GENIUS Act so our regulators can get to work implementing a
comprehensive stablecoin framework.
Ms. WATERS. Mr. Speaker, I include in the Record the following
letters from organizations that oppose this terrible bill: a letter
from the AFL-CIO, which is scoring this vote, and a letter from Public
Citizen.
AFL-CIO,

Legislative Alert,

July 14, 2025.
Dear Representative: On behalf of the AFL-CIO, I am writing
to urge you to oppose two bills on crypto currency that may
soon be up on the House floor for a vote this week. The
GENIUS Act, (S. 1582) and the CLARITY Act (HR 3633) pose
risks to both retirement funds and to the overall financial
stability of the U.S. economy. Instead of regulating crypto
currency, these bills will enable the crypto industry to
operate without effective oversight, and this will endanger
the financial health of working people.

Poorly regulated crypto assets are dangerous to pensions

Unions strongly support workers having retirement benefits
and regularly negotiate for pension plans in employment
contracts. But retirement plans are only solvent if their
assets are protected from fraud and unethical practices.
Neither of these bills provide a regulatory structure for
crypto assets or stablecoin that is similar to that of other
assets in pensions. While currently most pensions do not
carry crypto assets because of the risks associated with
them, the bills provide the facade of regulation that may
make these assets more mainstream in portfolios. Passing this
legislation will allow the proliferation of assets that
investors will wrongly perceive as safe.
But the problem with these bills is more significant than
they do not provide strong regulations for pensions; if they
are passed they will reduce the safety of many assets and
create problems across retirement investments. We are
particularly concerned that a loophole in the CLARITY Act (HR
3633) would allow non-crypto companies to put their stock on
the blockchain and evade the entire securities regulatory
framework that currently exists. This would reduce reporting
requirements, disclosures and other obligations. These
changes would put pensions and 401k plans in jeopardy of
having unsafe assets even if they were invested in
traditional securities.
Because we believe in strong, safe pensions that are there
for workers in their retirement, we oppose these bills and
ask that you do the same.

Financial instability would increase

The AFL-CIO has always supported measures that properly
regulate financial markets so that working people are not
cheated of their hard earned wages. In the aftermath of the
2008 financial crisis which had its genesis in unregulated
derivatives markets and widespread fraudulent banking
activities, we supported legislation that created the
Consumer Financial Protection Bureau (CFPB) and strengthened
financial regulations through the Dodd-Frank Act.

[[Page H3425]]

The GENIUS and CLARITY Acts do not protect consumers,
workers or the financial system and instead they expose all
to more risk. The GENIUS Act would allow tech companies to
become de facto banks or issuers of a corporate currency,
without requiring them to adhere to equivalent bank
regulatory oversight. Stablecoins are not inherently stable
and the assets that are permitted to back the value of
stablecoins in the bill are not sufficiently strong. Thus, a
situation similar to the failure of Silicon Valley Bank
(SVB), which was brought about by the failure of the
stablecoin peg, looms large. The bills also do little to curb
the fraud, illegal activity and corruption that continues to
be prevalent in anonymous crypto markets. As such, these
bills provide the perfect environment for the next financial
crisis to germinate.

Oppose These Bills

For all the reasons above and more, the AFL-CIO strongly
urges you to vote no on the GENIUS Act, (S. 1582) and no on
the CLARITY Act (HR 3633). Working people need policies that
effectively regulate financial markets and ensure that hard
earned retirement benefits are not endangered by risky
assets. We need to make sure that the financial system is
stable instead of creating a casino for crypto billionaires
to make more profits.
Sincerely,
Jody Calemine,
Director, Government Affairs.
____

PUBLICCITIZEN,

Washington, DC, July 14, 2025.
Honorable Members,
House of Representatives,
Washington, DC.
Dear Representative: On behalf of more than 500,000 members
and supporters of Public Citizen across the country, we ask
you to please vote NO on three cryptocurrency bills slated
for full House consideration this week. These include the
GENIUS Act (recently approved by the Senate); the CLARITY
Act; and the CBDC Anti-Surveillance Act. These dangerous
bills legitimize the cryptocurrency Ponzi scheme that will
undoubtedly leave more Americans scammed and will enable
criminal behavior.

Trump's Massive Crypto Grift

Regardless of a Member's position on whether the many risks
of harm posed by, cryptocurrency outweigh its supporters'
inflated promises of innovation through blockchain-based
payment systems, no responsible lawmaker can support these
measures because they ratify the greatest corruption in
presidential history: Donald Trump's crypto ventures, which
astound in the scope of the grift and flagrancy of
commitment. Leading ethicists agree, including the White
House ethics ``czars'' for each president since Clinton
(except for Trump's).
Trump once dismissed bitcoin, the most popular crypto, as
``based on thin air.'' It is a ``scam.'' It can facilitate
unlawful behavior, including drug trade and other illegal
activity.'' Now, he's the self-proclaimed crypto president.
In May, the Trump family announced an agreement with a fund
backed by Abu Dhabi that ``would be making a $2 billion
business deal using the Trump firm's digital coins,''
according to the New York Times. That deal involved a
stablecoin. The Constitution (Article 1, Section 9) forbids
accepting money (specifically a ``present'' or ``emolument'')
or anything of value from any ``king, prince, or foreign
state.''
Previously, Trump hosted a presidential dinner for the
largest new buyers of his crypto ``meme,'' called ``$Trump.''
Federal law strictly regulates payments to government
officials, including gifts. Although the president may
receive gifts, he or she may not ``solicit'' gifts. These
prohibitions begin with the Constitution's Emoluments Clause
and are reiterated in the U.S.'s anti-bribery statute, 18
U.S.C. Sec. 201, and federal regulations, 5 C.F.R. Sec. 2635.
Although section 2635.205 lists several exemptions from the
prohibition, none exempts soliciting purchases for personal
gain.
As to why the public might be interested in sending money,
the website explains: ``This Trump Meme celebrates a leader
who doesn't back down, no matter the odds.'' Under the Trump
meme website's question, ``What is a meme?'' the website
explains: ``Merriam-Webster's meme noun: 1: an idea,
behavior, style, or usage that spreads from person to person
within a culture.''
The website states that ``Trump Memes . . . are not
intended to be, or to be the subject of, an investment
opportunity, investment contract, or security of any type.''
Additionally, the Securities and Exchange Commission (SEC)
stated that meme coins have ``no use.'' Other cryptocurrency
observers deride memes generally as without value. Former
aide Anthony Scaramucci said Trump's effort demeans broader
cryptocurrency efforts, calling it ``ldi Amin level
corruption.'' Another commenter said that the Trump meme ``is
effectively a `for sale' sign on the White House.'' Some,
including an author in the Washington Post, characterized
this token as a ``sh--coin.''
In short, it appears Trump is not soliciting money in
exchange for an investment or tangible product (such as a
Bible, sports shoes, or a guitar), but soliciting money in
exchange for nothing--that is, asking for a gift that will
benefit him personally.
Already, Trump has profited millions from the meme and
other ventures. His initial sale generated nearly $100
million. The latest salvo in April brought in roughly $100
million more. Some new buyers come through the Binance
exchange, legally barred for US investors, meaning that Trump
may well be violating the emoluments clause with this venture
as well.
The dangers inherent in the Trump meme portend ominously.
Should the president be allowed to enrich himself in this
way, other politician might follow this path, rendering the
prohibition on solicitation in 18 U.S.C. Sec. 201 and the
prohibitions on receipt of gifts by officials other than the
president meaningless.
Paradoxically, while this Trump meme is worthless (by his
own estimation) Trump managed to create an earlier crypto
that is worth less. In October, 2024, he became the ``chief
crypto advocate'' for World Liberty Financial, a nascent
cryptocurrency firm. The World Liberty Trump crypto is worse
because it cannot be resold. This Trump crypto buys only
``governance,'' but only a minority share. Trump controls the
majority of the governance tokens.
Now, the House considers a trio of bills regarding
cryptocurrencies. At the very least, Congress must bar the
president along with all elected officials and their families
from owning, buying or otherwise trafficking in stablecoins.
Americans must be assured that policy won't be fashioned by
those profiting from the shape of the legislation.
Further, Congress should approve an amendment that restates
conflict laws that already apply to the president. Namely, he
may not solicit gifts; he may not accept gifts from a foreign
sovereign; he may not sell political favors.
Pro-crypto lawmakers apologize that Trump corruption will
persist whether or not Congress approves crypto legislation.
We reject this defeatist position. Congress must not abdicate
any powers to hold Trump accountable. Without conflict-of-
interest guardrails, approving these bills effectively
endorses Trump's conflicts. The bills will integrate crypto
into mainstream banking, serving to fatten his grift.
At the same time, we believe each bill fails to protect
investors while facilitating the funding of illicit
activities, which we explain in detail below.

h.r. 3633, the digital asset market clarity act of 2025

This measure succeeds the ``Fit 21 Act'' of the last
Congress, approved with bipartisan support, a result we
believe reflects profligate political spending by the crypto
sector in 2024. Now that the crypto political spenders
brazenly threaten to recycle even more of their ill-gotten
gains into future elections, Congress is speeding through
more pro-crypto bills.
The CLARITY Act falls so short of necessary investor
protections as to invite mockery. Putting a sign on the keg
at a frat party that says ``Over 21 only'' would achieve
better results at tamping down harmful behavior.
Fundamentally, the CLARITY Act accords the imprimatur of
federal government approval for crypto by awarding official
SEC-approved status for qualified firms.
To qualify for approved status, a firm might actually
register. Exemptions, however, abound. Sections 309 and 409
of the legislation would exempt firms if they relate to ``the
operation of a blockchain system.'' Crypto projects may win
exemption for contracts that trade and settle on a
blockchain. The bill exempts tokens with ``value, utility or
significance,'' a designation that the sponsor itself can
claim. And all existing tokens enjoy a grandfather
protection, legal amnesty for any reporting requirements.
In effect, the bill claims to establish a speed limit and
then provides what amount to exceptions for drivers with red
cars, fast cars, or if they're in a hurry.
Further, the bill offers a means for non-crypto companies
to bypass securities law and use the blockchain to raise
funds. This threatens to upend a near century of securities
law- and rule-making that established American markets as the
envied, disciplined, safe, and largest in the world. Once the
crypto craze dissolves and/or crashes, this element of the
bill, if it becomes law, will constitute one of the greatest
deteriorations of sound securities law ever. The Securities
Industry and Financial Markets Association, the lobby that
represents firms that underwrite and help investors trade
stocks, shares this concern. Recently the association wrote
to the Securities and Exchange Commission with a warning
about the potential pitfalls of allowing firms to put stocks
on the same blockchain technology that underpins digital
assets without following the same rules that apply to the
equities market. Doing so, SIFMA said, raises questions about
whether investors would be getting the best prices when
trading such tokenized stocks and if that trading could
hamper capital formation in the U.S.
The CLARITY Act fails to provide adequate compliance
requirements to deter money laundering. Drug, arms and human
traffickers use crypto to avoid detection. If crypto
promoters simply required every participant to register--just
as a driver secures a driver's license--much of this problem
would abate. That the bill sponsors resist this simple policy
speaks grimly about whom they are serving with this
legislation.
Finally, bill sponsors claim they promote this bill to keep
crypto innovation American and provide long needed
regulation. But not all ``innovation'' advances an economy.
Crafty cyberthieves deserve no trophy, nor do romance
scammers, but both varieties of

[[Page H3426]]

scammers frequently use crypto to bilk their marks. Moreover,
current securities law provides a rubric for crypto. The
Biden administration asked crypto to register and comply;
some did. Most, however, prefer to grift outside any
barriers. Congress must not plant the US flag on this rogue
industry through this bill.

the genius act

The GENIUS Act focuses on essentially one element of what's
necessary to govern stablecoins: namely the integrity of
their reserves. It requires that the sponsor buy safe
securities, such as U.S. treasuries.
Even here, however, the GENIUS Act falls short because it
also allows a coin's sponsor to include uninsured demand
deposits. While cash might seem safe, if held in a bank,
accounts beyond $250,000 would not enjoy FDIC coverage. The
episode of Silicon Valley Bank's failure demonstrated this
vulnerability. Further, the bill relies on sponsor
certification (or attestation) as to the components of the
reserve. Instead, responsible legislation should require an
audit by a firm overseen by the Public Company Accounting
Oversight Board (PCAOB). (Some stablecoins have sought audits
from firms outside this recognized regime.)
Generally, the GENIUS Act includes several foundational
flaws. First, it invites major commercial firms such as
Amazon, Walmart, Twitter/X and/or Facebook/Meta to enter the
banking sector because it lacks provisions under the Banking
Holding Company Act that otherwise prohibit non-financial
firms from entering the banking business. The nation's
centuries old policy separating banking and commerce stems
from concerns about concentration in power. Creditors should
not face the moral hazard of competing with the borrower.
Viability of a credit facility should not hinge on the
viability of a commercial venture. For example, an automobile
manufacturer that also sponsored a stablecoin might raid the
reserve should car sales begin to falter. Or a major online
aggregating retailer might disfavor a subcontractor if it
failed to use the aggregator's stablecoin. History
illustrates that when banks have entered commerce, such as
financiers did in the late 19th century during the
construction of railroads, manipulations led to frequent
economic shocks. Any stablecoin legislation should obligate
issuers to abide by robust Bank Holding Company Act
provisions that guard against these harms by restricting
sponsorship to existing banks.
Second, the GENIUS Act provides a dual oversight structure,
permitting stablecoins under a certain value ($10 billion) to
register under individual states. This allows a race to the
bottom, where unscrupulous sponsors would seek the state with
the most convenient rules. The bill calls on the states to
establish safety standards, but these will inevitably be
worked out between industry and lawmakers with little
consumer protection given the scant interest by average
Americans in this sector. Further, a bad actor could game the
$10 billion limit by organizing multiple funds, beginning a
new one once the last one reaches this figure.
The bill also fails to establish clear safeguards for those
stablecoins that seek federal oversight, with the same vague
injunctions to regulators. As implementation of the 2010
Dodd-Frank Wall Street Reform and Consumer Protection Act
demonstrates, regulators were slow to implement rules, and
those rules reflected intense Wall Street lobbying. With the
U.S. Supreme Court decision eliminating Chevron deference,
rules that industry finds inconvenient now may perish at the
whim of cherry-picked courts.
Third, the bill fails to provide speedy resolution for
customers in case of failure of a stablecoin. Bankruptcy does
not suit a firm that custodies savings that should be
available within days of a failure, as is the case with banks
that are resolved by the Federal Deposit Insurance Corp.
Section 9 of the GENIUS Act references sections of Chapter 11
of the Bankruptcy Code, affording holders of payment
stablecoins ``priority.'' But bankruptcy triggers an
automatic stay on payments that could take years before the
relief of funds, according to Georgetown Prof. Arthur
Wilmarth, which renders ``priority'' little relief in
actuality. Related to this, the bill includes inadequate
custodial rules. The GENIUS Act declares that stablecoins are
property of the investor and must be segregated from sponsor
funds. But this doesn't direct the bankruptcy court to pay
the investor immediately.
Lastly, the bill lacks a fair redemption regime. It simply
requires the stablecoin sponsor to establish a policy. It
fails to prohibit a firm from establishing exorbitant fees,
or setting an unreasonable time to honor a redemption, or
favoring some customers over others. A sponsor could
establish long waiting periods; a sponsor could even change
policies, such as advertising a low fee one month, then
raising it the next, and setting different fees for different
customers. In a money market mutual fund, all customers
receive the same prevailing interest rate and enjoy equal
redemption rules.

central bank digital currency

The CBDC Anti-Surveillance State Act oddly places its
specious talking point in the bill's title. The bill would
bar the government from establishing a central bank digital
currency on the argument that it would invade personal
financial privacy.
In reality, the sponsors of this bill serve the interests
of private sector cryptocurrency promoters that we believe do
not want to be displaced by a better, government-sponsored
digital currency. It is revealing that so-called innovators
in the free market fear they might be outdone by federal
technocrats. Public Citizen believes these self-described
crypto innovators are craven fraudsters looting the
vulnerable with a Ponzi scheme.
Public Citizen does support exploration of a Central Bank
Digital Currency (CBDC). This federal digital coin, in one
form dubbed a FedAccount, holds the promise to address some
of the problems with the payment system.
Conceived by Lev Menand of Columbia Law School in June
2018, the CBDC would be a Federal Reserve account. It would
be available to ``any U.S. resident or business in digital
wallets operated by the Federal Reserve, the Post Office, or
one of the country's several thousand community banks,'' he
explains. ``The digital wallets would charge no fees and have
no minimum balances. They would come with debit cards, direct
deposit, and bill pay. They would have customer service,
privacy safeguards, and fraud protection--if, for example,
one lost their password. And these accounts would earn
interest at the same rate that the Fed pays to banks.''
Lack of profitability for the banks represents one of the
reasons that banks fail to service roughly six percent of the
population. The FedAccount would be available to those whom
banks have failed to serve regardless of their balance. They
would be streamlined to provide access with immediate payment
clearing. There would be no fees charged. With such an
account, delivery of federal payments would be immediate
We believe the Menand idea deserves attention. Searching
for a talking point, the bill's sponsors claim the idea would
lead to a surveillance state. They seem unaware that credit
card firms, major banks, and other financial institutions
already own personal financial data. By the bill's logic,
they should be banned as well.
For questions, please contact Bartlett Naylor.
Sincerely,
Public Citizen.

Ms. WATERS. Mr. Speaker, I reserve the balance of my time.
Mr. HILL of Arkansas. Mr. Speaker, I yield 1 minute to the gentleman
from New Jersey (Mr. Gottheimer), who is a distinguished member of the
House Financial Services Committee.
Mr. GOTTHEIMER. Mr. Speaker, I rise in support of the bipartisan
GENIUS Act. This legislation builds on the bicameral negotiations that
Chairman Hill, former Chairman McHenry, Chairman Steil, and I, and so
many others, have worked so hard on for the past years.
The GENIUS Act is smart bipartisan legislation that backs stablecoins
through the U.S. dollar on a 1-to-1 basis and allows States to make
future safeguards to further protect consumers.
The GENIUS Act, as I said, protects consumers and gives clear rules
of the road to allow America to lead the way in a space that is key to
our economy. It cracks down on illicit finance, helps counter bad
actors, and reinforces the global strength of the dollar, all while
lowering the cost of payments and making transactions happen in just
seconds.
The bill has already passed the Senate in a strong bipartisan way.
Now, it is time for us to clarify rules for stablecoins, protect
consumers, and promote American innovation.
As I said before, when we were talking about the CLARITY Act, the
question is: Do we want some rules of the road or no rules of the road?
To vote against this bill and to vote against the CLARITY Act is
irresponsible if you want to make sure that the Trump coin has
oversight and that consumers are protected.
The SPEAKER pro tempore. The gentleman from New Jersey's time has
expired.
Mr. HILL of Arkansas. Mr. Speaker, I yield an additional 15 seconds
to the gentleman from New Jersey.
Mr. GOTTHEIMER. Mr. Speaker, to not pass this legislation is deeply
irresponsible. It will allow the Wild West to continue.
This will protect consumers and ensure that the Trump coin and others
are overseen, with protection and oversight from the CFTC. It is
critically important for protecting consumers and protecting our
country.
Ms. WATERS. Mr. Speaker, let me reiterate that it is irresponsible to
turn this bill over to the President of the United States, and I
continue to reserve the balance of my time.
Mr. HILL of Arkansas. Mr. Speaker, I yield 2 minutes to the gentleman
from Georgia (Mr. Carter).
Mr. CARTER of Georgia. Mr. Speaker, I rise today to voice my support
for

[[Page H3427]]

S. 1582, the GENIUS Act of 2025, which will provide a clear regulatory
framework for the issuance of stablecoins in the U.S.
This bipartisan, industry-supported bill will finally give the
stablecoin asset class clear rules of the road for the issuance and use
of digital assets. The GENIUS Act will establish standards so that
issuers are credible and stablecoins are quality assets in a rapidly
innovating digital market.
I thank the Senate for passing this bill and getting it to the House
so quickly. I encourage all of my colleagues to vote in support of the
GENIUS Act. It is a vital step in keeping America at the pinnacle of
financial innovation.
Mr. Speaker, let's make the U.S. the crypto capital of the world.
Ms. WATERS. Mr. Speaker, I continue to reserve the balance of my
time.
Mr. HILL of Arkansas. Mr. Speaker, I yield 1 minute to the gentleman
from Virginia (Mr. Vindman).
Mr. VINDMAN. Mr. Speaker, as the vice ranking member of the Commodity
Markets, Digital Assets, and Rural Development Subcommittee of the
House Committee on Agriculture, I rise today in support of both the
CLARITY and GENIUS Acts.
These bills aren't perfect, but digital innovation is critical to our
economy, and I support a regulatory framework that protects consumers
in the financial system.
However, I am concerned about the ability of certain officials to use
these assets for self-enrichment at the highest levels of our
government. These bills ensure Members of Congress and many other
government officials must abide by ethics rules that we expect from
government officials, allowing the industry to innovate as it should.
Two individuals are exempted, the President and Vice President.
This is incredibly dangerous, and it undermines confidence in this
important industry. It also further degrades the public trust in our
government, especially at a time when that trust is already eroded by
the President's refusal to release the Epstein files.
We need to take important steps to establish a regulatory framework
for digital assets to thrive and to restore public trust. We need
action now, and I hope we can close these loopholes.
Ms. WATERS. Mr. Speaker, I continue to reserve the balance of my
time.
Mr. HILL of Arkansas. Mr. Speaker, I yield 1 minute to the gentleman
from Florida (Mr. Haridopolos), our majority whip of the House
Financial Services Committee.
Mr. HARIDOPOLOS. Mr. Speaker, once again, we are showing that we can
lead here in Washington, D.C., getting things done with the leadership
of our President and our leadership here in the House, working together
with the United States Senate.
It shows that we are offering that certainty and stability once again
for our economy to make America first. We are going to make the dollar
dominant once again, and we are going to lead on digital currency
payments.
It will increase, of course, the demand for U.S. Treasuries and move
us toward that dominant position we need to have in the financial
markets.
I applaud our chairman. As a new member of this committee, it has
been wonderful to watch a person in action who is attempting to work
with the other side, pushing through bipartisan legislation, and, once
again, proving that Washington can work if we have leadership at the
helm.
Ms. WATERS. Mr. Speaker, I have no further speakers, and I am
prepared to close if the gentleman from Arkansas has no further
speakers. I reserve the balance of my time.
Mr. HILL of Arkansas. Mr. Speaker, I am prepared to close, and I
reserve the balance of my time.
Ms. WATERS. Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, let me again reiterate that a vote for S. 1582 is a vote
to give Trump the pen to write the rules that would put more money in
his family's pockets. A vote for S. 1582 is a vote for consumer harm. A
vote for S. 1582 is a vote to plant the seeds for the next financial
crisis. A vote for S. 1582 is a vote to endanger our national security.
That is why I will be voting ``no'' on S. 1582, the GENIUS Act, and I
urge all other Members to also vote ``no''.
Mr. Speaker, I yield back the balance of my time.

{time} 1140

Mr. HILL of Arkansas. Mr. Speaker, I yield myself the balance of my
time for closing.
Mr. Speaker, let me start by saying that we are here on the floor,
where we have heard a vigorous debate about dollar-backed payment
stablecoins. Our committee has worked under both Democratic leadership
with Ms. Waters and Republican leadership to research this, talk about
it, think about it, and have hearings about it for over 5 years now. We
come to the House floor today with a bill before us that, while not
perfect, is a good bill, as has been evidenced by our speakers on the
floor.
S. 1582, the GENIUS Act, is a simple, bipartisan bill that is long
overdue and is based on that bipartisan work in both Chambers. Wow, we
are actually legislating. We are seeing bills passed in both Chambers.
It is exciting for me to see the good work of my friend, Chairman Tim
Scott of the Banking Committee, in leading a policy-driven effort to
put America's financial leadership first. S. 1582, as written by Bill
Hagerty, does exactly that.
Mr. Speaker, 68 Senators voted for this bill in the United States
Senate. A cloture-proof margin is only 60, but here 68 Senators came
together, including 18 Democrats. They vigorously debated this bill,
worked on it, improved it, modified it, and sent it to us in the House.
Likewise, Chairman Steil here in the House worked with those Senators
on both sides of the aisle all along the way to take the ideas that we
had here in the House in our markup and our STABLE Act and improve the
GENIUS Act.
With this legislation today, on a bipartisan basis, we are
modernizing our financial infrastructure, streamlining transactions,
lowering costs, and expanding financial tools for everyday Americans.
This is about putting American innovation first. It is about creating a
future where innovation is met with clarity, not confusion; where
American ingenuity is empowered, not stifled, by an outdated, not-fit-
for-purpose regulatory regime.
The GENIUS Act will help maintain U.S. global leadership in financial
technology, digital innovation, and the power of the reserve currency--
the United States dollar--while reinforcing important consumer
protections and critical regulatory oversight where it is needed most.
This is commonsense, forward-looking legislation that reminds me of
the earliest days of this House Chamber agreeing in 1996 not to tax or
regulate the internet, but to tax and regulate how people use the
internet. This is a keen example of that principles-based legislation.
Mr. Speaker, I urge all my colleagues on both sides of the aisle to
support the GENIUS Act, and I yield back the balance of my time.
The SPEAKER pro tempore. All time for debate has expired.
Pursuant to House Resolution 580, the previous question is ordered on
the bill.
The question is on the third reading of the bill.
The bill was ordered to be read a third time, and was read the third
time.
The SPEAKER pro tempore. The question is on the passage of the bill.
The question was taken; and the Speaker pro tempore announced that
the ayes appeared to have it.
Ms. WATERS. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further
proceedings on this question will be postponed.

____________________