The **GENIUS Act** (Guiding and Establishing National Innovation for U.S. Stablecoins Act) is a landmark U.S. federal legislation enacted on July 18, 2025, to establish a comprehensive regulatory framework for *payment stablecoins*—digital tokens pegged to a fixed monetary value and designed for use as a means of payment or settlement[2][5]. As the first major U.S. crypto law, it provides legal clarity and oversight for stablecoin issuers, addressing long-standing regulatory ambiguity in the stablecoin industry[3][5]. The Act defines payment stablecoins as digital assets backed one-to-one by reserves in U.S. currency or liquid financial assets such as short-term Treasury securities, ensuring stability and liquidity[1][4]. It prohibits issuers from paying interest to holders and restricts the use of reserve assets, forbidding rehypothecation except under narrow conditions to maintain liquidity[1][6]. Stablecoins under the Act are explicitly not treated as securities, national currencies, or insured deposits, and issuers must comply with Bank Secrecy Act and anti-money laundering regulations[1][4]. A key feature of the GENIUS Act is its *dual regulatory framework*, allowing issuers to choose federal or state primary regulation and supervision, akin to the U.S. dual banking system[1][5]. This structure aims to foster innovation while ensuring financial stability and consumer protections. The Act limits issuer activities to issuing and redeeming stablecoins, managing reserves, and providing custody services, with strict asset segregation requirements[6]. Passed with bipartisan support, the GENIUS Act represents a significant policy victory for the digital asset sector, signaling the U.S. commitment to integrating stablecoins into the mainstream financial system while mitigating systemic risks[3][5]. While the Act focuses on stablecoins, future regulatory efforts will likely address broader cryptocurrency market aspects[3]. Its implementation now depends on federal agencies crafting detailed rules on capital