In the often-heated discourse surrounding cryptocurrency regulation, the GENIUS Act has emerged as a piece of landmark legislation, though its true significance is widely misunderstood. To be clear, the act does not eliminate government oversight of money, it does not make Bitcoin tax-free, and it is not a backdoor for a state-controlled digital currency. In fact, with its accompanying anti-CBDC provisions, it stands in direct opposition to such a future.
The real triumph of the GENIUS Act—and what should be celebrated—is its role in breaking the decades-long stranglehold that a small cadre of powerful banks and regulators has held over the global clearing of U.S. dollars. It effectively ends their exclusive power to decide who gets access to dollars and dismantles their quiet mandate to surveil how that money is used. This act is the first genuine crack in a system that has been steadily drifting toward financial authoritarianism, nudging it meaningfully toward broader monetary freedom and global access to the world’s reserve currency.
The Crypto Dream and Its Nightmare Corollary
Over a decade ago, the promise of cryptocurrency gave rise to two competing visions for the future of money. The “Crypto Dream” was one of a better, more accessible financial system. In this future, Bitcoin and other digital assets would serve as a kind of public utility, fostering growth and improving lives, especially for those without access to traditional banking. For this dream to be realized, crypto had to remain decentralized and untainted by the very institutions it sought to disrupt.
The “Crypto Nightmare,” however, was the dark inverse of this vision. It foresaw a world where public blockchains would be co-opted to create the ultimate tool of financial surveillance. As BlackRock CEO Larry Fink once described it, a “true global digital currency” would make every transaction transparent, ending money laundering but also obliterating financial freedom in the process.
This dystopian scenario is not merely theoretical. U.S. financial policy, from the Bank Secrecy Act of 1973 to the USA PATRIOT Act, has progressively deputized banks as agents of surveillance, forcing them to monitor and police their clients. This reached a zenith during the Obama era’s “Operation Chokepoint,” which pressured banks into cutting off services to legally operating but politically unpopular businesses.
The Tide Turns Against Financial Imperialism
The crypto industry later found itself in the crosshairs of a similar campaign, which Coinbase CEO Brian Armstrong characterized as a moment when “Warren and Gensler tried to unlawfully kill our entire industry.” But a confluence of factors began to shift the political calculus.
Intense lobbying from the crypto sector, crucial court rulings against SEC Chair Gary Gensler, and the explosive growth of USD-denominated stablecoins created an undeniable momentum. At the same time, the U.S. dollar’s global dominance faced serious threats from de-dollarization efforts led by China and the BRICS bloc. Stablecoins disrupted this strategy, spreading U.S. dollars across the globe and forcing rivals like China and Russia to focus on building state-backed alternatives.
The final turning point was the U.S.-led sanctions response to Russia’s 2022 invasion of Ukraine. The move exposed the practical limits of weaponizing the dollar and weakened the case for keeping its clearing process monopolized by a select few.
A New, Pragmatic Path Forward
The GENIUS Act was born from this new reality. It represents a devastating blow against American financial imperialism, shifting power from correspondent banks to stablecoins as a means to maintain the dollar’s global appeal. This was not necessarily a moral awakening in favor of financial freedom, but rather a tacit admission that the old levers of power—sanctions and chokepoints—no longer held their former weight.
The changing priorities were on full display when Senator Elizabeth Warren pushed an amendment to require all stablecoin issuers to monitor onchain transactions—a proposal even more extreme than the PATRIOT Act. Fellow Democratic Senator Kirstin Gillibrand pushed back, warning it would kill the industry. Her priority, she made clear, was not expanding surveillance but strengthening the dollar.
While the GENIUS Act may not be the fulfillment of the ultimate crypto dream, it marks a potential end to the crypto nightmare. For now, it has resulted in more global access to dollars and more access to crypto, charting a new course that values access and influence over absolute control.
