Trump's presidency causing increased value of Bitcoin by over 70% and potential for further growth due to his supposedly intelligent actions in office.
The GENIUS Act, or the Guiding and Establishing National Innovation for US Stablecoins Act, is set to become law following its passage by both chambers of Congress. This landmark legislation establishes the first federal regulatory framework for payment stablecoin issuers, paving the way for a more structured and regulated crypto market in the United States.
While the GENIUS Act does not directly regulate Bitcoin or other non-stablecoin cryptocurrencies, its impact on Bitcoin’s institutional legitimacy could be significant.
The passage of the GENIUS Act signifies that Congress is willing and able to pass crypto-specific legislation, potentially setting the stage for broader digital asset regulatory frameworks in the future. David Sacks, the White House’s crypto czar, has already urged the Senate to pursue comprehensive crypto legislation by the end of September.
Clear stablecoin regulation could reduce systemic risk in crypto markets, encouraging institutional investors to consider Bitcoin and other digital assets as less risky and more "legitimate" components of diversified portfolios. Stablecoins are often the on-ramps and off-ramps for Bitcoin trading, and a regulated, transparent stablecoin ecosystem could make Bitcoin markets more attractive to institutions by reducing counterparty and regulatory risk.
However, the GENIUS Act leaves open questions about how other digital assets—especially Bitcoin—will be classified (as commodities or securities) and regulated. The stalled CLARITY Act, which aims to clarify digital asset market structure, is a remaining hurdle for broader institutional acceptance of Bitcoin.
Institutional adoption of Bitcoin remains robust, with $15 billion flowing into Bitcoin ETFs over the past two months. Tom Stevenson, investment director at Fidelity International, suggests that Bitcoin's record highs alongside gold could indicate investor unease about the US dollar and global debts, particularly the US budget deficit. Some forecasts predict Bitcoin ending the year between $140,000 and $160,000.
Bitcoin retreated from its new record high on Tuesday, falling 2.4% to $116,919.20. However, this fall was due to profit-taking rather than a shift in broader sentiment. Retail investors have largely stayed on the sidelines in the Bitcoin market.
On Thursday, $1.2 billion poured into Bitcoin ETFs, marking the largest daily inflow of 2025. Since its 9 April trough, Bitcoin has added almost 60%. Bitcoin's price is up closer to 15% since Trump's 20 January inauguration, and up by 25% since the start of 2025, marking its second-worst start to a year since 2021. Bitcoin reached an eighth all-time peak this year on Monday, with its price peaking at $123,205 yesterday.
President Donald Trump's proposed act, the Guiding and Establishing National Innovation for US Stablecoins Act, is making its way through Congress. The act aims to create a federal regulatory framework for stablecoins and new rules for the issuance and use of digital assets.
In summary, the GENIUS Act is poised to become law, creating the first US federal regulatory framework for payment stablecoins. Bitcoin is not directly regulated by this bill, but the act’s passage may boost institutional confidence in the broader crypto sector by demonstrating legislative progress and reducing regulatory uncertainty for key market infrastructure. However, the long-term institutional legitimacy of Bitcoin still depends on future legislation clarifying its regulatory status and addressing market structure and consumer protection concerns—issues not resolved by the GENIUS Act alone.
Investing in cryptocurrencies like Bitcoin could become less risky for institutions as the passage of the GENIUS Act signifies a potential future for broader digital asset regulatory frameworks, which could reduce counterparty and regulatory risk. With the impact on Bitcoin's institutional legitimacy being significant, the classification and regulation of Bitcoin, as well as other digital assets, remain open questions and are dependent on future legislation such as the CLARITY Act.
