After a heated debate over the country’s key crypto legislation, President Donald Trump managed to rally the Republicans to pass a groundbreaking law.

The House approved the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act and the Digital Asset Market Clarity (CLARITY) Act on Thursday, receiving support from both parties.

The GENIUS Act will create a regulatory framework for stablecoin payments. 

Stablecoins are a type of cryptocurrency that is backed on a 1:1 basis by an asset, such as the U.S. dollar or the European euro. The stablecoin market has seen rapid growth recently, with its total market value soaring to about $250 billion, up from $130 billion just two years ago.

The measure provides rules for stablecoin issuers, including mandates that require audits and that the firm can back the assets they give to customers. 

Stablecoins have become a major player in the world of digital finance, but, until now, the rules have been unclear. The GENIUS Act aims to bring more trust and stability to the industry, ensuring that companies behind these “digital dollars” are held accountable for managing people’s money safely and transparently.

‘This piece of legislation is going to make America the crypto capital of the world, and that’s what the president promised,’ Press Secretary Karoline Leavitt said at Thursday’s briefing. 

The 79-year-old president has been a loud advocate for the budding industry, he even spoke at the Bitcoin Conference 2024 and named an ‘AI Czar,’ David Sacks, to lead a White House team focused on the digital asset class.

President Trump is expected to sign the GENIUS Act during a White House ceremony on Friday.

These reforms are thought to improve trust in the stablecoin market. 

For example, Tether, an El Salvador-based crypto firm that is the largest stablecoin issuer globally, has been accused of not backing up its assets 1:1. 

The GENIUS Act would mean that stablecoins in U.S. markets need to show receipts. 

Last year the president co-founded his own digital asset company, World Liberty Financial, with his sons Donald Trump Jr., Eric and Barron. 

The firm is directly involved in various projects, and notably issues its own stablecoin called ‘USD1,’ according to the company’s site.

The CLARITY Act passed on Thursday is a market structure bill which aims to provide clear rules for crypto markets by giving oversight to the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). 

Under Biden, crypto companies that were subject to SEC enforcement actions complained that former SEC Chair Gary Gensler did not create clear industry guidelines. 

The CLARITY Act will be taken up by the Senate later this year.

In addition to the landmark crypto legislation, the president is also interested in cutting taxes for crypto.

The White House indicated Thursday the president supports exempting small cryptocurrency purchases from taxes, aiming to make using cypto for everyday payments – like buying a cup of coffee – more practical. 

‘Of course, right now, that cannot happen, but with the de minimis exemption, perhaps it could in the future,’ Leavitt said. 

Senator Cynthia Lummis is leading an effort to pass a bill that would set a $300 threshold for untaxed crypto transactions, allowing purchases under $300, up to $5,000 per year, to be made without triggering taxes. 

The bill also aims to eliminate double taxation for crypto miners and stakers, provide equal tax treatment for digital assets compared with traditional investments, and clarify how lending digital assets is taxed. 

The legislation faced delays in the House after Representative Marjorie Taylor Greene pushed for stricter limits, holding up the legislation until Republican leaders agreed to add measures banning the Federal Reserve from issuing a central bank digital currency to another bill. 

Supporters hope changes like this will help encourage more Americans to use and accept cryptocurrency for everyday transactions, while balancing innovation, privacy, and regulation.