Senate Democrats have blocked the GENIUS Act—a long-awaited stablecoin bill—amid rising concerns over former President Trump’s crypto ties and a $2 billion foreign-backed investment in his affiliated ventures.
At a Glance
- The GENIUS Act failed to pass with a 48–49 Senate vote
- Democrats cited concerns over Trump-linked crypto conflicts
- A $2B Abu Dhabi investment in Trump’s firm triggered resistance
- Proponents say the bill is key to U.S. digital asset leadership
- Senate GOP leaders accuse Democrats of political sabotage
Trump’s Crypto Ties Sink Bipartisan Support
The GENIUS Act, originally hailed as a rare bipartisan effort to regulate stablecoins, collapsed this week after revelations that a Trump-affiliated crypto firm received a $2 billion investment from an Abu Dhabi-backed company. The investment centered on a stablecoin venture called World Liberty Financial, reportedly run by Trump allies and family members.
Senator Elizabeth Warren spearheaded the opposition, stating, “Democrats who both support and oppose the GENIUS Act agree that green lighting Donald Trump’s corrupt stablecoin deals is wrong.” Many Democrats argue that passing the bill in its current form would legitimize what they call an unregulated gateway for Trump-linked financial gain.
Watch a report: Senate Democrats block bipartisan crypto bill.
Internal Fractures and Legislative Fallout
The bill was one of the most advanced efforts to establish legal guidelines for stablecoins—digital assets pegged to fiat currencies like the U.S. dollar. But the ethics issue created a split. While most Republicans remained in favor, Democrats insisted on new guardrails to prevent elected officials from profiting through crypto ventures.
Even Senator Mark Warner, who had once supported the measure, withdrew over unresolved anti-money laundering provisions. Senators Rand Paul and Josh Hawley also voted against the bill, citing different reservations about federal overreach and legislative timing.
Senator John Thune criticized Democrats for the failed cloture vote, saying they “put partisanship above policy and obstruction above innovation.” (foxbusiness.com)
Outlook for U.S. Crypto Leadership
Backers of the GENIUS Act, including Senator Tim Scott, say failure to pass the bill leaves the U.S. lagging behind digital finance competitors like China. The bill would have allowed regulated stablecoins to operate under federal oversight—something Wall Street, fintech companies, and even consumer advocacy groups have called essential.
Scott vowed to continue the effort, saying, “We will continue to work on digital assets legislation to help make the United States the crypto capital of the world.” But with Trump’s financial interests now fused with crypto policy, bipartisan agreement may be even harder to reach.
For now, the collapse of the GENIUS Act marks a sharp reminder that digital currency, like any form of power, is never far from political entanglement.
