Senators Urge Treasury to Preserve State Role in Stablecoins
Bipartisan senators led by Cynthia Lummis asked Treasury Secretary Scott Bessent to preserve state authority to regulate most stablecoin issuers under the GENIUS Act.
A bipartisan group of senators led by Republican Cynthia Lummis asked Treasury Secretary Scott Bessent to preserve state authority to regulate stablecoin issuers as the department finalizes rules to implement the GENIUS Act. In a letter delivered Tuesday the lawmakers pressed the Treasury to clarify a state certification pathway and to allow flexible timing so states can take part in supervising stablecoin issuers.
Under the GENIUS Act, stablecoins with a market value of $10 billion or less may be regulated by state authorities if a state adopts laws largely similar to the federal standard. Based on market data, only three stablecoins currently exceed that $10 billion threshold: Tether (USDt), USDC (USDC) and USDS (formerly DAI), meaning most issuers could seek state supervision.
The senators criticized the Treasury’s proposed rule for not specifying the timeline or procedural steps for state certification. The letter argued the absence of clear procedures creates uncertainty and could be interpreted as a single, limited window that would bar future state applications. It added: “Congress clearly sought to preserve the dual banking system.” The letter further noted that State banking agencies have an important role in supervising the market.
Other signatories were Republicans Bill Hagerty, Kevin Cramer and Pete Ricketts, and Democrats Kirsten Gillibrand, Angela Alsobrooks and Catherine Cortez Masto. The senators asked the Treasury to design a certification process that accommodates different state legislative schedules and allows states to seek recognition later as demand for charters develops.
The Treasury solicited public input in April on how to apply the GENIUS Act’s state-level provisions; public comments closed on June 2. The department is expected to draft a final rule for publication in the Federal Register. President Donald Trump signed the GENIUS Act into law in July 2025, establishing a federal framework for stablecoins and a conditional pathway for state supervision.
The senators requested clear procedures and ongoing opportunities for states to seek certification so state banking agencies can carry out the oversight responsibilities described in the law.
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