Quick overview

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The Senate passed a bill creating the first federal framework for dollar-backed cryptocurrencies, called stablecoins.

Although the GENIUS Act’s passage in the upper chamber by a vote of 68-30 doesn’t immediately make the new legislation law, it still requires approval from the House and President Trump.

The cryptocurrency community is already applauding the bill’s swift progress as a significant step.

Trump is increasing his financial stake in stablecoins. World Liberty Financial, a new cryptocurrency company supported by President Trump and his sons, has launched its US-dollar-pegged stablecoin in collaboration with BitGo.

Traditional businesses, from large lenders to mega-retailers, are debating whether to issue their coins. If the legislation passes the House, it is expected to unleash a wave of new stablecoin entrants.

Bank of America (BAC) CEO Brian Moynihan stated at a Morgan Stanley conference last week, “We’re working with the industry, working individually.”

Bank of America and other major banks met earlier this month to discuss possibly starting a cooperative stablecoin network. Last week, the Wall Street Journal also revealed that Walmart (WMT) and Amazon (AMZN) are exploring stablecoin opportunities.

The traditional payment system may be eclipsed by this new wave of competition, especially if businesses attempt to bypass established card-based networks like Visa (V) and Mastercard