GENIUS Act: Elizabeth Warren denounces a law on stablecoins that is too favorable to private interests

With Trump back, the American political scene has the air of a monarchical remake. For some, it's euphoria. For others, a palpable unease. For several months, Elizabeth Warren, Democratic figurehead, has tirelessly repeated the same warning: troubled ties unite Trump, his relatives and the crypto universe. And with the enactment of the GENIUS Act, the fire starts again. The atmosphere is tense, the stakes colossal. Because behind this law, Warren sees a dangerous transfer of power between public institutions and private interests.

Stablecoins and the GENIUS law: a slippery slope with Trumpian flavors

The GENIUS law, signed in July 2025 by Donald Trump, requires stablecoin issuers to be fully backed in dollars or equivalent assets. It requires audits for the giants of the sector (more than $50 billion in capitalization). But what Warren denounces is the veneer.

In a letter addressed to the Treasuryshe speaks of a regulatory framework “ slimmed down for crypto banks “.

It directly targets one stablecoin in particular: USD1, issued by World Liberty Financial, a company associated with the Trump family. This token, according to Warren, embodies a blatant conflict of interest.

She and Jeff Merkley also requested detailed documents on a $2 billion USD1 transaction between an Emirati company and Binance.

One example among others? Maybe. But in the senator's eyes, the GENIUS Act could well be an opportunity for the powerful to rewrite the rules of the financial game… to their advantage.

Crypto and systemic risks: an open-air financial Trojan horse

What this law also reveals is the ambiguity of stablecoins: between regulation and poorly controlled freedoms. The case of Paxos is striking. In October, $300 trillion in PYUSD (PayPal's stablecoin) was created in error. Everything was burned afterwards, but the incident shook the crypto planet.

Warren made it a symbol. She states:

This incident demonstrates the serious risks that operational failures can pose to an issuer, market integrity and potentially financial stability. Treasury owes the public an explanation of how it intends to manage these risks and, if it cannot, what powers it needs from Congress to do so.

The senator adds that the GENIUS Act failed to establish fundamental protections to prevent stablecoins from blowing up our financial system. She also criticizes the omission of common-sense amendments to guarantee users the same protections as those offered by an application like Venmo or a traditional bank account, while maintaining the authority of the Consumer Financial Protection Bureau over the application of the law.

In this matter, crypto is not the enemy, but the revealer. Proof that shaky regulation could precipitate crises… starting with a simple bug.

Power, money and private currencies: towards a democratic crisis?

The real heart of the debate, for Warren, is ethics. And democracy.

Who creates money? Who controls it? Beneath the technological veneer, these are fundamentally political questions.

However, the GENIUS law remains silent on key points:

• No ban on digital giants issuing their own currency;
• No extension of CFPB protections to stablecoin users;
• No clarification on the use of the Stabilization Fund to save issuers in crisis;
• No official rejection of a deal with El Salvador that could favor Tether.

And above all, a harmful climate where the rules seem to be written by those who benefit from them.

For Elizabeth Warren, stablecoins are gradually becoming the favorite digital weapon of cartels, authoritarian regimes and illicit networks. It demands that the US Treasury act immediately. The time is no longer for observation but for action, with concrete measures to fill the gaps in a regulation that is still too permissive.

Stablecoins: key figures to know to understand the debate

• The stablecoin market is now worth over $150 billion;
• The Emirates/Binance transaction was worth USD 2 billion1;
• The Paxos incident: 300,000 billion PYUSD minted in error;
• Audits only concern issuers > $50 billion;
• The CFPB remains out of play for stablecoin users.

In reality, the distrust between Warren and the crypto universe is not new. Well before the vote on the GENIUS Act, Ripple's legal manager had already accused the senator of blocking progress in the sector. Further proof that behind the question of stablecoins lies a much deeper debate: that of monetary power in a changing world.