Whereas the GENIUS Act is a stablecoin invoice, U.S.-based Bitcoin lovers ought to be listening to the language within the invoice because it pertains to the power to transact privately with crypto belongings — together with bitcoin.
Two paperwork that just lately circulated amongst Senate Banking Committee Democrats point out that Senate Democrats wish to see amendments made to the GENIUS Act that may tremendously scale back consumer privateness in crypto transactions.
Senate Democrats’ Evaluation of GENIUS Act
The primary of those two paperwork is a two-pager entitled “Banking Committee Democratic Staff Analysis on Latest GENIUS Act Draft”.
This doc is stuffed with the kind of rhetoric that’s generally related to the Rating Member of the Senate Banking Committee, Senator Elizabeth Warren (D-MA).
It refers to stablecoins as instruments for illicit finance (even though the largest stablecoin issuer, Tether, often works with the Department of Justice (DoJ) and the FBI to cease the unlawful use of stablecoins).
It additionally states that the present iteration of the GENIUS Act “does nothing to truly impose primary obligations on [crypto mixers] to forestall illicit finance.”
This latter critique of the invoice is antithetical to steering that Deputy Legal professional Basic (DAG) Todd Blanche supplied in a memo on April 7, 2025. DAG Blanche said that the DoJ will not goal crypto mixing services for the acts of their finish customers.
On this doc, nevertheless, Senate Democrats point out that they plan to proceed concentrating on crypto mixing know-how as a substitute of those that abuse it.
If amendments concerning the concentrating on of crypto mixers are added to a revised model of the GENIUS Act, this might have an effect on Bitcoin customers who make use of such know-how within the title of preserving their privateness.
A Letter From Democrats Opposing The GENIUS Act
Senate Banking Democrats circulated a second doc on Monday, as nicely.
This doc, a letter signed by 46 advocacy teams, opposed the GENIUS Act.
Brendan Pedersen of Punchbowl News shared segments of the letter on X.
The authors of the letter declare that the GENIUS Act doesn’t do sufficient to forestall illicit finance partly as a result of it nonetheless permits for “self-hosted wallets that lack know-your-customer (KYC) necessities.”
If the GENIUS Act is amended in order that it requires KYC for all wallets that contact stablecoins — self-custodial wallets included — it’s seemingly solely a matter of time earlier than comparable regulation is established for Bitcoin wallets.
Bitcoin Transactional Privateness Is At Stake
Simply because the GENIUS Act doesn’t straight reference Bitcoin doesn’t imply that Bitcoin gained’t be affected by it.
If Senate Democrats get their method and crypto mixers grow to be a goal of the invoice and/or if the invoice requires that every one wallets that contact stablecoins require customers to KYC, and the invoice is enacted into regulation, anonymity in crypto transactions will grow to be against the law.
So, whereas some Bitcoiners could also be anti-stablecoins, most, I might wager, aren’t anti-privacy. Due to this fact, it might behoove them to contact their elected officers to induce them to vote “no” for the GENIUS Act if the upcoming iteration of the invoice restricts the power to transact privately.