As cryptocurrency has grown from a speculative investment to a new asset class, governments are seeking ways to regulate it. Some have already created frameworks to protect users, while others bide their time. In 2022, the European Union introduced measures to prevent money laundering and terrorism funding while providing users with protections. In July 2025, Congress passed the GENIUS Act, which defines how stablecoins and digital assets should be classified and regulated by federal agencies. Other legislation aims to reduce regulatory overlap and enhance transparency for businesses and investors.
The GENIUS Act would require stablecoin issuers to have full reserve backing, monthly audits, anti-money laundering compliance, and disclosure standards that promote market trust. It also requires that only approved issuers may create stablecoins pegged to the U.S. dollar, making it more difficult for non-approved issuers to launch unauthorized stablecoins. In addition, the bill includes rules preventing stablecoins from being used to invest in securities or to transfer money across state lines, which could help limit financial fraud and terrorist financing.
The legislation marks a major step forward in crypto regulation for the U.S., and it would cement the industry’s transformation from a scandal-ridden technology experiment to a mainstream commercial tool. But it still faces opposition from many Democrats, who say it allows the industry to skirt critical financial regulations and leave consumers unprotected. The bill was passed by the House on Thursday and sent to President Trump for his signature.
About the Author
