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![Joshu_Woo Avatar](https://lunarcrush.com/gi/w:24/cr:twitter::22346072.png) 🍄 [@Joshu_Woo](/creator/twitter/Joshu_Woo) on x 2798 followers
Created: 2025-07-19 02:49:36 UTC

I just took all of the text @RichardHeartWin provided from the genius bill and told @grok to briefly summarize the whole in laymen’s terms.

If you aren’t an attorney you’ll appreciate this version:
__________________________________________
The **GENIUS Act** (Guiding and Establishing National Innovation for U.S. Stablecoins Act), signed into law, regulates **payment stablecoins**—digital assets designed for payments, pegged to a stable value like the U.S. dollar. Here’s a concise breakdown:

X. **Purpose**: Establishes a federal framework to regulate stablecoin issuance, ensuring financial stability, consumer protection, and anti-money laundering (AML) compliance.

X. **Key Definitions**:
   - **Payment Stablecoin**: Digital asset used for payments, redeemable for a fixed monetary value, not a security or commodity.
   - **Permitted Issuers**: Only approved U.S. entities (banks, nonbanks, or state-regulated entities) can issue stablecoins.
   - **Digital Asset Service Provider**: Entities handling stablecoin transactions (e.g., exchanges, custodians).

X. **Core Requirements**:
   - **Issuance Restrictions**: Only permitted issuers can issue stablecoins; others face fines up to $1M or X years in prison.
   - **Reserves**: Issuers must hold 1:1 reserves (cash, Treasury securities, etc.) to back stablecoins, disclosed monthly.
   - **AML Compliance**: Issuers must follow Bank Secrecy Act rules, maintain AML and sanctions programs, and block illicit transactions.
   - **Consumer Protections**: Clear redemption policies, no deceptive marketing, and no interest payments on stablecoins.

X. **Regulation**:
   - **Federal Oversight**: The Comptroller of the Currency, Federal Reserve, and FDIC regulate federal issuers; states can regulate smaller issuers (<$10B in issuance).
   - **State Option**: States with comparable regimes can regulate issuers, subject to federal review.
   - **Foreign Issuers**: Must register, hold U.S. reserves, and comply with U.S. laws or face bans.

X. **Prohibitions**:
   - No tying stablecoin services to other products.
   - No misleading names implying U.S. government backing.
   - Non-financial public companies need approval to issue stablecoins.

X. **Insolvency Protections**: Stablecoin holders have priority claims in issuer bankruptcy, ensuring access to reserves.
X. **Interoperability**: Regulators may set standards for stablecoin compatibility across platforms.
X. **Enforcement**: Regulators can suspend, fine, or remove non-compliant issuers or officers.
X. **Studies & Reports**: Treasury to study non-payment stablecoins and AML innovations; annual reports on industry trends.

**Effective Date**: XX months post-enactment or XXX days after final regulations.

**In Short**: The Act creates a strict U.S. framework for stablecoin issuance, prioritizing safety, transparency, and AML compliance, while allowing state flexibility and foreign issuer access under tight rules.


XXXXXX engagements

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**Related Topics**
[stablecoins](/topic/stablecoins)
[told](/topic/told)

[Post Link](https://x.com/Joshu_Woo/status/1946402012457017358)