GENIUS Act 2025: Key Takeaways for Wealth Management Firms
By Jeff Gearhart and Dan Garrett
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The passage of the GENIUS Act on July 18, 2025 marks a turning point in the regulatory landscape for digital assets in the U.S. For the first time, the industry now has a federal framework that defines and governs stablecoins, a key building block in the broader ecosystem of blockchain-based financial markets.
What the GENIUS Act Does: Key Provisions and Definitions
At its core, the GENIUS Act does three critical things:
- It defines “payment stablecoins” as fiat-redeemable digital tokens not considered securities or deposits.
- It establishes federal oversight of permitted issuers—whether bank affiliates, national non-bank entities chartered by the Office of the Comptroller of the Currency (OCC), or state-regulated issuers under certified programs.
- Requires robust reserve, capital, audit, and consumer protection standards, including 1:1 reserve backing and insolvency protections for stablecoin holders.
Why Stablecoins Matter
Stablecoins are the cash leg of blockchain transactions, meaning they act as the equivalent of cash in blockchain-based financial transactions. They enable real-time, trusted settlement and serve as the foundation for tokenized assets, smart contracts, and decentralized finance. Without legal clarity on stablecoin issuance and operations, institutional adoption of digital asset trading has remained tentative at best.
The GENIUS Act is designed to give financial institutions and fintech innovators a regulated path to issue and utilize stablecoins. While the GENIUS Act stops short of defining what constitutes a security or setting rules for trading platforms and broker-dealers, it lays essential groundwork:
- It affirms that not all digital tokens are securities, creating a framework for functional differentiation.
- It enables on-chain settlement and payments, a prerequisite for seamless digital asset trading.
- It introduces interagency coordination between the Federal Reserve Board, the OCC, the United States Department of the Treasury, and state regulators, a model that future digital asset rules will likely emulate.
Whether you’re a broker-dealer looking to streamline settlement, an RIA exploring tokenized investment products, or a fintech firm building blockchain-native solutions, understanding the GENIUS Act is essential to staying competitive, compliant, and future-ready in a rapidly evolving financial ecosystem.
Support for Navigating the GENIUS Act
Oyster Consulting is at the forefront of digital asset strategy, compliance, and operations. We guide clients through stablecoin readiness—from structural analysis and reserve accounting models, to regulator engagement. Whether you are preparing to issue, custody, or advise on stablecoins, our multi-disciplinary team can help you.
Contact CRC-Oyster Consulting to explore how we can help you meet the new requirements—and elevate your stablecoin strategy with confidence.
Jeffrey Gearhart
Jeffrey Gearhart is an intuitive, analytical leader with over 30 years of experience in banking and capital markets businesses. Prior to joining Oyster, he held senior leadership roles with The Bank of New York Mellon, including business line COO, CFO, business development and relationship management.
Dan Garrett
Dan Garrett provides general business leadership, technology strategy and execution for RIA, Broker-Dealer, and Clearing firms, including spearheading digital transformations, optimizing operations, navigating complex business transitions, and building software development teams and proprietary applications.
