On July 17, the House advanced three major crypto bills during what many dubbed “Crypto Week.” A day later, only the GENIUS Act crossed the finish line and was signed into law on July 18, establishing the first federal framework for payment stablecoins. The other two bills, the CLARITY Act (focused on market structure) and a separate Anti-CBDC bill, await further action in the Senate.
To understand the implications of the GENIUS Act, Kunal Bhasin, a fintech expert and CEO of 1West, a company at the forefront of innovative financial solutions for small businesses, shared his thoughts.
A Welcome Step Towards Regulatory Clarity
According to Bhasin, the clarity provided by the GENIUS Act is overdue and beneficial. “For the first time, we’re seeing real clarity on how digital assets are regulated in the U.S., and that’s something the industry has needed for a long time,” he notes. “The frameworks around stablecoins are especially encouraging. Requiring issuers to maintain proper reserves and disclose them regularly is just good financial ethics.”
Alongside GENIUS, the House also passed a separate bill aimed at blocking a government-run retail Central Bank Digital Currency (CBDC). This is a move Bhasin says “reinforces that privacy and individual financial choice still matter in our system.”
Risks of Regulatory Arbitrage and Historical Echoes
Despite his optimism, Bhasin advises caution. New legislation always introduces new risks. “We need to stay vigilant. Just because we have new rules doesn’t mean the system can’t be manipulated,” he warns. Bhasin highlights the risk of regulatory arbitrage, a practice where crypto firms might choose regulators based on lax oversight, undermining intended safeguards. “That’s not what responsible innovation looks like,” he emphasizes.
A broader market-structure bill (the CLARITY Act) cleared the House but still awaits action in the Senate, where a separate discussion draft is in play and a split jurisdiction that could fuel the very “regulatory arbitrage” critics warn about.
Bhasin points to history as a cautionary tale. The GENIUS Act could inadvertently lead to scenarios reminiscent of the infamous “wildcat” era of banking in the 19th century, where lightly regulated banks issued private currencies lacking proper backing. Skeptics argue the new regime could echo “wildcat” banking if large corporates issue stablecoins without bank-like guardrails, a scenario that could broaden systemic exposure well beyond crypto-native users.
“If stablecoin issuers are allowed to act like banks without being held to the same standards, we could be repeating history,” Bhasin says. “A major stablecoin collapse today wouldn’t just impact one project; it could ripple across exchanges, wallets, and entire DeFi ecosystems that rely on those tokens. We can’t afford to relearn old lessons the hard way.”
Investor Vigilance Is Essential
As the landscape evolves, investor responsibility becomes even more critical. Bhasin stresses that regulation alone doesn’t guarantee safety: “Investors should not assume regulation means safety. Just because something’s allowed doesn’t mean it’s smart. Crypto is still in a highly volatile, fast-evolving space.”
To navigate this environment, Bhasin offers clear advice for crypto investors. “Pay attention to where your assets are regulated, how they’re backed, and what safeguards exist if something goes wrong,” he urges. “Don’t get caught up in headlines or hype. Real value still comes from fundamentals like clear governance, strong reserves, and long-term vision.”
Balancing Innovation and Oversight
As fintech leaders and policymakers forge ahead, striking the right balance between encouraging innovation and ensuring robust safeguards will remain vital. While the GENIUS Act sets a strong foundation, the ongoing dialogue between industry participants and regulators will determine whether this moment in crypto history becomes a leap forward or a cautionary tale.
Expect a phased rollout as agencies write rules and issuers adapt their disclosures, audits, and reserve practices. The true measure of success for the GENIUS Act will depend on sustained vigilance and responsible engagement from all stakeholders. It remains essential to assess how these regulations will evolve and whether they effectively support the promising yet volatile world of digital assets.
