In 2025, as cryptocurrency continues its evolution from fringe finance to mainstream infrastructure, lawmakers across the country are taking a more deliberate look at how, and whether, it should be regulated. The federal government is beginning to establish ground rules around stablecoins and token issuance. Meanwhile, California is moving forward with its own legislation that is all over the news and has the possibility of completely reshaping how crypto interacts with government and how individual rights are defined in a digital asset world.
From pilot programs for crypto payments to laws that assert your right to self-custody, this year has seen some of the most serious legislative proposals yet. So this week, we are taking a closer look at two federal crypto bills making noise in Washington, two California bills advancing in Sacramento, and what it all means for the future of digital finance.
Okay, back it up. What are we talking about here?
Cryptocurrency refers to digital assets that use cryptographic systems to enable secure, decentralized transactions without needing a central authority like a bank. The first and most well-known cryptocurrency, Bitcoin, launched in 2009. Since then, the space has exploded to include thousands of tokens with different uses and structures. One key category is stablecoins, which are cryptocurrencies designed to maintain a fixed value, often pegged to the U.S. dollar. These tokens are used for payments, savings, and trading across crypto networks and have become central to how digital economies operate.
As stablecoins and other crypto assets move from niche communities into mainstream finance, the U.S. government is increasingly interested in setting clear rules. Lawmakers cite risks like fraud, market volatility, and lack of consumer protections as reasons to regulate. This marks a significant shift, now playing out through new legislation at both the federal and state levels.
Federal First: A Framework for Stablecoins
Congress has long lagged behind the pace of innovation in crypto and technology in general, but 16 years after Bitcoin's release, we are finally seeing meaningful movement. As stablecoins have grown into high-volume instruments used for payments, remittances, and trading, the US government is moving to assert regulatory oversight. In 2025, two major bills emerged from Congress to establish clear rules for this class of digital assets: the GENIUS Act in the Senate and the STABLE Act of 2025 in the House. Both bills propose detailed frameworks that would formally integrate stablecoins into the financial system without allowing them to operate like traditional bank products.
S 1582 – GENIUS Act
The GENIUS (Guiding and Establishing National Innovation for U.S. Stablecoins) Act, introduced by Senator Hagerty, introduces comprehensive regulation for payment stablecoins in the United States. It establishes a detailed framework for their issuance, oversight, and operation. The bill defines a payment stablecoin as a digital asset designed to be used for payments or settlements, with a fixed monetary value and a commitment from the issuer to maintain that stability. Only specific entities, called permitted payment stablecoin issuers, may issue these tokens. That includes subsidiaries of insured depository institutions as well as federally or state-qualified issuers that meet strict criteria.
Issuers under the GENIUS Act must maintain reserves on a one-to-one basis, fully backed by high-quality liquid assets such as U.S. currency, insured bank deposits, or short-term Treasuries. They are required to publicly disclose key information, including reserve compositions, redemption policies, and any associated fees. The bill mandates compliance with anti-money laundering laws and other financial crime regulations. It also gives both federal and state regulators broad authority to supervise and enforce these standards. Additional provisions address how stablecoins would be treated in bankruptcy, how foreign issuers can gain access to U.S. markets, and how issuers must avoid misleading consumers, such as by falsely suggesting their stablecoin is government-backed.
The bill passed the Senate in June 2025 with bipartisan support. It has been praised by industry leaders for offering legal clarity and a path to mainstream adoption, while also drawing cautious support from consumer advocates who view its enforcement tools and transparency mandates as a long-overdue step forward.
HR 2392 – STABLE Act of 2025
The STABLE (Stablecoin Transparency and Accountability for a Better Ledger Economy) Act of 2025, introduced by House Representative Steil, establishes a similarly comprehensive framework tailored to the oversight of payment stablecoins. It mandates a licensing and supervisory process for any entity that wants to issue such a token. Issuers must be approved either federally or by a compliant state regulatory authority. Like the GENIUS Act, the STABLE Act prohibits anyone not formally licensed from issuing a payment stablecoin.
Under this bill, permitted issuers must maintain 100 percent reserves in safe, liquid assets, such as U.S. dollars, insured bank deposits, or short-term government securities. They must also publish monthly reports detailing their reserve composition. The bill bars interest-bearing stablecoins, explicitly separates them from securities definitions, and aims to prevent them from being misrepresented as traditional deposits. Oversight is shared between federal bodies such as the Federal Reserve, OCC, and FDIC, along with qualified state regulators for regionally chartered issuers.
In addition to the core regulatory mechanics, the STABLE Act includes provisions for broader impact studies on the systemic effects of stablecoins. It also proposes a temporary moratorium on algorithmic or synthetic stablecoins until proper safeguards are studied and implemented. Supporters argue the bill creates market certainty and consumer confidence. Critics, especially some state financial regulators, worry about potential federal overreach into state-chartered fintech spaces.
These two bills reflect a shift in federal policy, moving from unregulated crypto speculation toward a structured regime grounded in traditional financial safeguards. They aim to protect consumers, reinforce U.S. payment systems, and integrate stablecoins into the broader financial architecture.
Why California? Why Now?
California has long been a hub for crypto activity. From Silicon Valley startups to Los Angeles blockchain incubators, the Golden State has played a central role in shaping the digital asset economy. But with that leadership has come risk. Californians have been disproportionately affected by exchange collapses, scams, and investment frauds.
In response, Governor Gavin Newsom signed a 2022 executive order encouraging a balanced approach to crypto regulation. While Congress focuses on stablecoins, California is moving more broadly. Two bills advancing in the legislature (AB 1180 and AB 1052) address how digital assets function across government payments, licensing, and property law. Together, they represent an effort to bring digital financial assets into California’s public and private sectors in a way that’s measured, legal, and future-facing.
AB 1180: A Pilot Program for Crypto Government Payments
AB 1180 directs the Department of Financial Protection and Innovation (DFPI) to develop regulations that would allow certain state payments to be made using digital financial assets. These assets are defined as digital representations of value used as a medium of exchange, unit of account, or store of value, though not legal tender. The bill does not create a blanket adoption. Instead, it creates a pilot program that becomes operative on July 1, 2026, and sunsets on January 1, 2031.
As part of the pilot, DFPI must submit a report to the Legislature by January 1, 2028. The report must include the number and value of crypto transactions processed, technical and regulatory challenges encountered, and recommendations for expanding use to other agencies. In short, AB 1180 sets up a limited, highly structured test run to explore how digital financial assets might work within California’s official payment systems. It is an incremental, research-driven first step.
AB 1052: Defining—and Defending—Digital Rights
While AB 1180 focuses on the state’s role, AB 1052 zeroes in on the private sector, consumer rights, and property law. Beginning July 1, 2026, any business involved in digital financial asset activities must be licensed by DFPI unless exempted. The bill also makes it legal under state law for individuals and businesses to accept digital assets for goods and services, bringing legal clarity to what has been a gray area for years.
An perhaps the most talked about item related to this bill, AB 1052 also modernizes California’s unclaimed property rules. If a digital asset account becomes dormant for three years, those assets escheat to the state. The bill creates protocols for how private keys and custody responsibilities must be handled. The State Controller may appoint a licensed custodian to manage escheated digital assets, and that custodian must meet strict standards for cybersecurity, compliance, and key management. Public entities are not required to accept digital payments, which preserves flexibility while still pushing the space forward. The bill offers a comprehensive legal framework for crypto activity within the state—something stakeholders have long said is needed.
Putting It All Together
Lawmakers at both the federal and state levels are moving beyond asking whether to regulate crypto. They are now building the tools to do it. The GENIUS and STABLE Acts create a federal regime for payment stablecoins, defining who can issue them, how they must be backed, and what disclosures are required. They aim to legitimize stablecoins without granting them privileges reserved for banks. The focus is on consumer protection, fraud prevention, and market stability.
California’s approach is broader and more experimental. AB 1180 creates a time-limited test for using crypto in state payments. AB 1052 takes on the harder structural questions: what counts as property, who can hold it, and how it should be regulated. Together, the bills reflect California’s willingness to step in where federal guidance is still evolving.
What unites all four bills is a shared acknowledgment that crypto is not going away. Its integration into legal and financial systems must be done deliberately and with enforceable rules. These proposals are not theoretical exercises, they are roadmaps for real-world use.
Looking Ahead
Crypto is no longer drifting in a legal gray zone. With both houses of Congress pushing forward on federal standards and California charting its own course, the U.S. is entering a new phase of coordinated digital asset policy. The GENIUS and STABLE Acts will soon face reconciliation and implementation, and California’s pilot and licensing frameworks may become models (or warnings) for other states.
The tone has changed. Lawmakers are no longer reacting to disasters or scandals. They are proactively setting the rules for how digital assets should function in a regulated economy. Whether or not these specific bills are perfect, they reflect a turning point. The U.S. is beginning to govern crypto not as a curiosity, but as a core part of modern finance.
The next phase of crypto regulation is here—and it’s happening one carefully worded bill at a time.
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