The US Senate on Tuesday passed a bill to create a regulatory framework for US dollar-backed crypto tokens, known as stablecoins, in a historic achievement for the digital asset industry.
The bill, known as the Genius Act, received bipartisan support, with several Democratic senators along with a majority of Republicans supporting the effort to create a federal regulatory framework.
The measure passed by a vote of 68 to 30.
Andrew Olmem, managing partner at law firm Mayer Brown, called the approval a milestone in the US digital finance industry.
He said it was the first time a strict law had been created specifically to regulate stablecoins, a high-potential financial product.
Stablecoins are a type of cryptocurrency designed to maintain a fixed value, usually at the same rate as the US dollar.
They are often used by crypto holders to transfer funds between tokens and their use has grown rapidly in recent years.
Stablecoin proponents argue that the technology is not only suitable for trading digital assets, but also has the potential to be used for fast, low-cost cross-border money transactions.
If signed into law, the bill would require stablecoins to be fully backed by short-term liquidity assets and would require stablecoin issuers to make monthly disclosures.
