Trump’s crypto dreams take off as US House passes two landmark bills — GENIUS Act and CLARITY Act explained in 5 points

The US House of Representatives passed three landmark cryptocurrency bills on Thursday, to make a proper framework for the virtual coins as promised by the Donald Trump administration.

Two of the legislations — the GENIUS Act and the CLARITY Act — were passed with significant bipartisan support, as well as lobbying from some Democrats.

Since taking office, Trump has made several moves to support the crypto sector, including appointing crypto advocate Paul Atkins to lead the SEC. Forbes magazine estimates that the president’s foray into the crypto business has doubled his wealth to $5.3 billion in just one year.

While the GENIUS Act bill will go to President Donald Trump’s table for his sign, the CLARITY Act will be presented in front of the Senate for a passage, with Republicans holding slim majority there.

GENIUS Act and CLARITY Act explained in 5 points

1. The GENIUS Act passed with a vote of 308-122 following the Senate’s approval in June and is now waiting to be signed into law. Under this Act, issuers of stablecoins like banks and crypto companies will need to hold reserves of enough US dollars or similar assets to support the coins’ value.

2. The GENIUS Act aims to regulate the roughly $238 billion stablecoin market, according to data from CoinDesk. When signed into law, this Act will help banks and other entities to have a clearer framework for issuing digital assets. The issuers will also need to publicly disclose the composition of their reserves on a monthly basis.

3. The CLARITY Act, which passed 294-134, would critically define when a cryptocurrency is a security or a commodity and clarify the Securities and Exchange Commission’s jurisdiction over the sector, something crypto companies aggressively disputed during the Biden administration.

4. Some Democrats fiercely opposed the CLARITY Act, arguing it could be a giveaway to Trump’s crypto ventures by enabling softer-touch regulation. That bill would need to pass through the Senate before heading to Trump’s desk for final approval.

5. Crypto companies have argued that most tokens should be classified as commodities instead of securities, which would enable platforms to more easily offer those tokens to their customers by not having to comply with a raft of securities laws.

(With Reuters, AFP inputs)