Bipartisan Senate Group Calls for Strong State Involvement in GENIUS Act Stablecoin Rules

A bipartisan group of U.S. senators has urged the Treasury Department to establish a clear certification process for states seeking authority to regulate stablecoin issuers under the GENIUS Act.

In a letter led by Senator Cynthia Lummis, the lawmakers argued that state regulators have been left without sufficient guidance as federal agencies move forward with implementing the landmark stablecoin legislation. They said states should be given a transparent path to demonstrate that their supervisory frameworks are comparable to federal standards.

The GENIUS Act, which creates the first comprehensive U.S. regulatory framework for stablecoins, requires Treasury to determine whether state regulatory regimes are “substantially similar” to federal requirements. However, the senators said Treasury’s proposed principles fail to explain how states can obtain that determination or how the certification process will work in practice.

According to the lawmakers, the absence of procedural guidance has created uncertainty among state regulators and industry participants alike. They warned that without clearly defined rules, the certification process could be applied in a way that effectively prevents states from participating in stablecoin oversight.

The letter, signed by Republicans and Democrats including Angela Alsobrooks, Catherine Cortez Masto and Kirsten Gillibrand, calls on Treasury Secretary Scott Bessent to issue written guidance detailing the application, review and approval process for state regulatory frameworks.

The senators also asked Treasury to set clear timelines and requirements while ensuring enough flexibility for states, whose legislative and regulatory processes can vary significantly. They argued that greater transparency is necessary to preserve the role Congress intended states to play in the implementation of the GENIUS Act and the broader regulation of the stablecoin market.