The Senate's GENIUS Act of 2025. It sounds impressive, doesn't it? Dig just beneath the surface, and you’ll find a big, bad ticking time bomb that’s endangering the future American financial security. Instead, it’s mischievously disguised as a crypto regulation bill. We don’t mean to stifle innovation here. It’s not about preventing foreign players, such as Tether, from taking advantage of huge loopholes that would, as Byer and others have put it, endanger American consumers and the supremacy of the dollar.
Is Senate Bill Betraying America First?
Let's be blunt: this bill, in its current form, is a betrayal of the "America First" principle. In particular, stablecoins are transforming into critical bridges between longstanding finance and the future of fintech. Whether you love them or hate them, there’s no arguing the significance of these upcoming events. Specifically, they claim quicker, less costly, and more convenient dollar-denominated transfers. But if those dollars aren't actually dollars, backed by verifiable reserves, we're building a house of cards.
The Trump administration understood this. We knew they were truly serious about producing a market-friendly framework when they prioritized strong consumer protections and called for transparency and accountability. The House's STABLE Act of 2025, with its emphasis on 1:1 reserve backing and anti-money laundering compliance, reflects that sensible approach. A light-touch, rules-based framework is all that is required.
The Biden administration appears hellbent on sowing disorder. The FBI data doesn't lie: a 53% increase in crypto investment fraud following Biden's 2022 executive order? That’s not progress—that’s a red flag the size of Texas.
Here's the unexpected connection: remember the 2008 financial crisis? Forget all those inscrutable financial instruments that almost destroyed the global economy. Second, the GENIUS Act allows foreign stablecoin issuers to play ball under a different set of rules. This step can set us on a dangerous path of deja vu, endangering average Americans as they pierce the siren’s song of easy crypto profits.
Unfair Advantage For Foreign Entities?
The GENIUS Act is giving a get-out-of-jail-free card to companies like Tether. And what does Tether offer? A stablecoin whose terms of use do not even promise redemption in U.S. dollars. A company that avoids key transparency obligations. A black box operating in the shadows.
This isn’t just a race to be the best. It’s about American businesses being put at a competitive disadvantage, as they are forced to comply with strict rules while their foreign competitors are allowed to pollute with impunity. It’s the equivalent of asking a marathon runner to go up against someone riding a motorcycle.
This is where the fear, justifiably, comes in. Now picture a world in which Tether’s reserves suddenly aren’t worth anything (and, to be frank, their track record isn’t exactly confidence-inspiring). Millions of Americans holding USDT could find themselves unable to redeem their coins, triggering a massive sell-off and potentially destabilizing the entire crypto market. And that’s not a hypothetical risk, it’s a very real possibility.
Will Fraud Rip Off Americans?
After all, markets can only work if everyone is playing the same game. Beyond the inequity, exempting foreign actors from such regulations encourages fraud. This sends a dangerously discouraging message: the U.S. is willing to tolerate extreme behavior in the crypto space. It shows that if it’s good for foreign companies, they’re risk appetite.
Think about it: If a U.S.-based stablecoin issuer defrauds its customers, they can be held accountable in American courts. Now, what is the result when a foreign entity, which imposes such alternative legal regime as it likes, steals from Americans? Good luck getting your money back.
The GENIUS Act isn’t merely a greatly misguided idea – it’s a diabolical one. This state of affairs seriously undermines U.S. leadership in the fast-moving crypto space. It provides foreign actors an inappropriate head-start and opens the door to rampant fraud. It’s time for Congress to get real and repeal this damaging loophole once and for all—before it’s truly too late.
We want regulations that ensure consumers and innovators are both protected. In this manner, the U.S. can again take the lead in the crypto revolution. The House’s STABLE Act is a reasonable alternative. The Senate’s GENIUS Act would be a disaster in the making.
The truth is, the “America First” approach should all be about protecting American consumers and businesses. It certainly can’t reward foreign state-owned enterprises and other actors engaged in bantam-level corruption. It's time for Congress to prioritize the interests of the American people and ensure that stablecoin regulation supports U.S. leadership in crypto, not undermines it.
