U.S. senators urge Treasury to preserve state oversight in GENIUS stablecoin rules

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Senators urge stablecoin oversight

Highlights

Senator Cynthia Lummis and a bipartisan group urged Treasury Secretary Scott Bessent to ensure the GENIUS Act allows state regulation of stablecoin issuers with $10 billion or less in market value.
Lawmakers warn the Treasury's current proposal lacks clarity on state certification procedures and timelines, risking uncertainty and future limitation of state-level approvals.
The GENIUS Act, signed in July 2025, permits state oversight for most stablecoins—excluding only Tether, USDC, and USDS—which could affect regulatory approaches and market structure.

Senators press for flexible state certification

As reported by Cointelegraph, Republican Senator Cynthia Lummis and a bipartisan group of senators sent a letter to Treasury Secretary Scott Bessent on Tuesday urging the department to ensure state authorities can regulate eligible stablecoin issuers under the GENIUS Act.

The lawmakers say the law is intended to preserve state participation by allowing issuers with a stablecoin market value of $10 billion or less to be supervised at the state level, provided the state has laws that are largely similar to the federal framework. They argue the Treasury's proposal does not clearly address the timeline and procedures for state certification, creating uncertainty over whether future approvals would remain possible beyond an initial window.

In the letter, the senators say state legislatures operate on different schedules and need a flexible certification framework so they can adopt compliant rules as demand for stablecoin charters emerges. The signatories include Republicans Bill Hagerty, Kevin Cramer and Pete Ricketts, and Democrats Kirsten Gillibrand, Angela Alsobrooks and Catherine Cortez Masto.

Implementation timeline and market implications

The GENIUS Act, signed into law by President Donald Trump in July 2025, sets rules for stablecoins and their issuers while preserving a role for state banking agencies. Treasury sought public input in April on how the law should be implemented at the state level, and the public comment period closed on June 2.

Treasury now moves to draft a final rule for publication in the Federal Register. Based on CoinGecko market value data cited in the report, only Tether, USDC and USDS currently sit above the $10 billion threshold, meaning most other stablecoins could fall within the range of potential state regulation if certification rules are finalized as lawmakers request.

Our earlier article on Circle (CRCL) and USDC expansion reviewed the company’s new partnerships aimed at accelerating USDC adoption and boosting digital payment volumes. It noted that despite these business fundamentals, CRCL remained under selling pressure, trading below key moving averages, with analysts watching a near-term stabilization range and critical support levels.

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