Crypto market update: Congress passes first federal stablecoin law

US Congress Delivers Landmark Crypto Legislation: A New Era of Stability and Growth

The cryptocurrency landscape reached a pivotal moment this week as the US Congress passed its first federal stablecoin law. This landmark legislation, known as the “Genius Act,” signals a significant step towards regulatory clarity and has immediately ignited optimism across the digital asset market.

For years, the crypto sector has operated within a regulatory gray zone, a factor often cited for volatility and investor hesitancy. The passage of the Genius Act, which cleared the House after bipartisan support in the Senate, aims to bring much-needed structure and confidence to a rapidly expanding part of the crypto ecosystem.

The Genius Act: Paving the Way for Secure Stablecoins

At its core, the Genius Act establishes a clear oversight framework for stablecoin issuers. This includes stringent requirements for:

• Reserve Backing: Ensuring stablecoins are fully backed by transparent, audited reserves.
• Regular Audits: Mandating consistent financial reviews to maintain accountability.
• Compliance: Enforcing adherence to anti-money laundering (AML) and sanctions laws.

Lawmakers and financial leaders, including Treasury Secretary Scott Bessent, believe these rules are essential for the safety and integrity of stablecoins, which are vital for facilitating trading and payments within the crypto economy without the volatility of assets like Bitcoin. This framework is projected to help the stablecoin market potentially swell to an astounding US$3.7 trillion by 2030, underscoring the immense value seen in a regulated environment.

Broader Regulatory Push: Defining Crypto's Future

The Genius Act wasn't the only piece of significant crypto legislation to advance during what Washington has dubbed “Crypto Week.” The House also passed two other crucial bills:

• One bill aims to definitively classify crypto assets as either securities or commodities, a long-awaited clarification that will help shape future regulation and market structure.
• Another, the “CBDC Anti-Surveillance State Act,” effectively blocks the Federal Reserve from issuing or piloting a US central bank digital currency (CBDC) without explicit congressional approval, addressing concerns about potential government surveillance and control.

While these latter two bills now move to the Senate for further consideration, their passage through the House underscores a growing legislative commitment to addressing the full spectrum of digital asset policy. This trifecta of initiatives represents a comprehensive effort to establish guardrails that can foster innovation while protecting investors.

Crypto Market Responds with Historic Surge

The market's reaction to this regulatory momentum has been nothing short of historic. The global crypto market capitalization has soared past US$4 trillion for the first time, directly fueled by the newfound optimism surrounding US federal legislation.

Key market movements on Friday, July 18, 2025 (as of 9:00 a.m. UTC), highlight this positive sentiment:

• Bitcoin (BTC): Priced at US$118,687, up 0.8 percent in 24 hours. Bitcoin briefly hit an all-time high of US$123,205 this week, maintaining over half of the market’s total value.
• Ethereum (ETH): Trading at US$3,604.95, up a significant 7.2 percent over the past 24 hours, and boasting a remarkable 22 percent jump over five days.
• Altcoins: Many altcoins also saw strong gains, including Solana (SOL) up 4.1 percent to US$180.04, XRP up 7.8 percent to US$3.45, and Cardano (ADA) up 4.3 percent to US$0.8524. Sui (SUI) was an outlier, down 2.7 percent to US$4.03.

This surge reflects increasing investor confidence that a robust, clear regulatory framework is finally materializing in the world’s largest economy. Institutional inflows have been particularly strong, with US-listed Bitcoin and Ether funds attracting a combined US$8.4 billion in July alone, further solidifying crypto’s role as a mainstream investment.

Key Takeaways for Investors

The developments of "Crypto Week" underscore a critical shift: regulatory clarity is now a powerful catalyst for growth in the digital asset space. For investors, this means:

• Reduced Uncertainty: A defined legal framework helps mitigate risks associated with regulatory ambiguity, making the market more attractive to broader participation.
• Increased Institutional Adoption: Clear rules are likely to accelerate the integration of cryptocurrencies into traditional financial systems, driving further capital inflows.
• Growth Potential: The projected growth of the stablecoin market alone suggests significant opportunities, anchored by the new safety guardrails.

As the crypto market matures, understanding legislative developments will be as crucial as tracking price movements. The path toward full regulatory integration is complex, but this week's progress marks a defining moment in the evolution of digital assets.