U.S. Senators Push Treasury to Include States in GENIUS Act Stablecoin Framework

A group of U.S. senators led by Senator Cynthia Lummis is urging the Treasury Department to establish a formal pathway for states to demonstrate their ability to oversee stablecoin issuers under the newly enacted GENIUS Act.

According to lawmakers from both parties, state regulators have been largely left out of the Treasury’s initial efforts to implement the federal stablecoin framework. They argue that states should be given a clear mechanism to prove that their regulatory standards and supervisory capabilities are comparable to those of federal authorities.

The Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act is currently being translated into rules by several federal agencies, including the Treasury Department. However, senators say the early regulatory process has raised concerns among state authorities that are working to develop their own GENIUS-compliant oversight regimes. Those concerns were outlined in a letter sent Tuesday by lawmakers led by Lummis, who chairs the Senate Banking Committee’s crypto subcommittee.

In the letter, the senators emphasized that Treasury’s criteria for determining whether state regulatory frameworks are “substantially similar” to federal standards will play a key role in implementation. While Treasury previously released proposed principles for evaluating state regimes, lawmakers noted that the guidance failed to specify timelines or procedures for state certification.

That lack of clarity has left states uncertain about how to proceed, the senators said. The issue is particularly significant as Congress continues to debate broader crypto legislation, including the Digital Asset Market Clarity Act.

The lawmakers also warned that, without detailed procedural guidance, the certification process could be interpreted in a way that limits or effectively blocks future state participation. They conveyed concerns raised by industry stakeholders that unclear rules could undermine the role envisioned for states under the law.

To address these issues, the senators are calling on Treasury Secretary Scott Bessent to issue written guidance outlining the application, review, and certification process for state regulatory regimes. They are seeking clearly defined timelines, transparent requirements, and enough flexibility to accommodate the varying legislative and regulatory processes across different states.