Amid a flood of industry lobbying in Washington, DC, and Democrats’ capitulation, the Senate is set to pass the GENIUS Act, a sweeping cryptocurrency law that could spread fraud-ridden, destabilizing digital currencies across the banking system. But lawmakers and consumer protection experts warn that the bill has an even more serious problem: it would allow Elon Musk and other Big Tech tycoons to issue their own private currencies.
That means we could soon live in a world where all online transactions will require us to pay for goods in billionaires’ own made-up monopoly money, for which tech giants will be able to charge exorbitant transaction fees.
This scenario isn’t just a pipe dream. It’s a long-running project by tech platforms to control payment networks. In the past few weeks, Meta began laying the groundwork once again to launch its own cryptocurrency.
What’s more, thanks to a bipartisan “compromise” that convinced Democratic holdouts to support the legislation, the latest version of the bill could stop the government’s top financial and tech regulator from overseeing any of these potential tech currencies.
The GENIUS Act, which stands for Guiding and Establishing National Innovation for US Stablecoins, was designed to create light-touch regulations for stablecoins, a more commonly used form of crypto token that is often pegged to the US dollar in an equivalent value (one stablecoin is redeemable to one dollar).
If it becomes law, any banking or even nonbanking enterprise could get a license to deal stablecoins with minimal oversight. This could riddle the entire financial system with volatility and make illicit activity like fraud and terrorism undetectable while providing major new markets to the companies issuing the cryptocurrencies. The El Salvador–based firm Tether is currently the largest trading platform for these currencies and has faced numerous US lawsuits for fraud.
After some crypto-friendly Democrats temporarily backed away from their support for the bill earlier this month, Republicans came to the bargaining table and made what appeared to be some modest concessions to temper Democrats’ concerns about Trump’s corrupt use of crypto for personal gain. But a legal analysis from the Democratic staff on the Banking Committee just blasted this new version of the bill for allowing Big Tech to create its own currencies, among a litany of other problems.
The bill also includes a giant carve-out to ensure Musk’s social media platform X, formerly Twitter, would not be covered by even modest restrictions, thereby “gifting the President’s closest Big Tech ally a competitive advantage in creating his own private currency,” according to the Banking Committee analysis.
Musk might not be the only one scoring these benefits. The Trump administration could also waive the bill’s more stringent requirements for any favored tech company, according to the Senate Banking Committee staff.
On top of these carve-outs, a new legal citation slipped into the bill tacitly strips away the authority of the Consumer Financial Protection Bureau (CFPB), a key financial and tech regulator, to oversee the issuance of stablecoins. The CFPB has been probing Meta and other tech companies’ payment networks and has taken action to regulate those platforms like banks.
Despite these concerns, sixteen Democratic senators just voted in favor of moving the updated bill to a floor vote, which all but guarantees its passage through the Senate. Just two Republicans, Senator Rand Paul (R-KY) and Senator Jerry Moran (R-KS), voted against the measure, disfavoring federal intervention to assist crypto and Big Tech.
According to Democrats on the Senate Banking Committee, their colleagues have now given license to the kind of outright pay to play that Democrats had claimed to oppose in the original version of the GENIUS Act.
The tech giants that stand to benefit from the bill funneled millions of dollars to key swing-seat candidates this past election. Those include vocal crypto allies Ruben Gallego (D-AZ) and Elissa Slotkin (D-MI), who each received $10 million from political action committees funded by cryptocurrency interests. The Protect Progress PAC, the Democratic arm of the crypto lobby’s campaign spending operation, spent $33 million on both primary and general election races in 2024.
The GENIUS Act is ostensibly geared toward assisting cryptocurrency companies whose lobbying groups have pushed hard for the bill. But Brian Shearer, a former senior adviser at the CFPB and a legal expert at Vanderbilt University, argues that the legislation’s implications will be far more wide-ranging across nonbanking industries.
The bill’s language erodes a two-hundred-year-old legal standard that mandates a separation between banks that deal in financial products and commercial enterprises that sell goods. The division was put in place to prevent industrial firms from accumulating too much power in finance, enabling them to restrict competitors or consumers from accessing banking.
In the past, blurring the lines between finance and commerce has caused major problems.
For example, within the financial sector, the 1999 repeal of the Glass-Steagall Act under former president Bill Clinton removed a long-standing barrier between the riskier business of investment banking and the more stolid side of commercial banking, which just deals with managing depositors’ accounts. Financial experts cite the law’s repeal as helping to pave the way for the 2008 financial crash.
While that outcome may sound extreme, the point, Shearer says, is that “even minor disruptions to the fundamentals of financial regulation can have these profound consequences to the whole financial system.” Regulators have warned of a potential financial collapse if crypto is allowed to infiltrate traditional banking markets.
The GENIUS Act also comes at a time when financial regulators, led by the CFPB, have been cracking down on Big Tech for using its market power to force user adoption of its own payment processing services, which come with high transaction fees.
Apple, Google, and Meta each run their own payment networks, and Musk has previously indicated his desire to integrate payment services into X’s social media platform.
Apple Pay has developed the most advanced online payment system, with nearly eight hundred million global users. As part of a Department of Justice antitrust lawsuit, Apple stands accused of forcing users and developers to adopt its payment network.
Former CFPB lawyer Brian Shearer explains that under the GENIUS Act, Apple could launch its own stablecoin “payment card,” which would hold customers’ deposits and give the tech giant even greater access to financial and transaction data on its users.
Meta has laid out perhaps the most elaborate plans for issuing its own currency. In 2019, company CEO Mark Zuckerberg announced the launch of Meta’s own crypto token known as Libra but pulled back because of blowback from global and US regulators. Federal regulators, including Federal Reserve chair Jerome Powell, warned that lax oversight on financial products like Libra could pose a risk to financial markets. For example, there’s no deposit insurance coverage for payments held on tech platforms.
Meta’s announcement of Libra drew scrutiny from the CFPB, which opened an inquiry into Big Tech payment networks. Following the probe, the agency issued rules in 2024 holding tech-based payment services to the same regulatory standards as other financial institutions and applying fraud, privacy, and other consumer-protection laws to stablecoins.
Shortly after the rules were announced, Zuckerberg complained about the CFPB’s actions on The Joe Rogan Experience podcast, and Musk called for the agency to be shut down.
Now the latest version of the GENIUS Act could strip the CFPB’s authority to enforce those rules. Without the CFPB’s involvement, a patchwork of other, less robust financial regulators would be left to monitor these potentially harmful practices.
As the legislation makes its way through the Senate, reports have emerged that Mark Zuckerberg is once again considering a company stablecoin. One reason cited for the move would be to make it easier for Meta to pay content creators overseas without dealing with cumbersome international banking procedures.
If lawmakers pass the GENIUS Act and allow Meta’s plans to move forward, the corporation could essentially become its own financial institution for an existing customer base of nearly four billion global users across its social media platforms.
“Big tech wants to open their own banks, which they can’t do under existing bank regulations,” wrote Shearer on the financial policy site Open Banker. “We know this is a real threat because Meta has already tried it and failed once before.”