Democratic Senator Elizabeth Warren has sharply criticized the GENIUS Act, which was recently signed into law by U.S. President Donald Trump and establishes the legal framework for regulating stablecoins. Warren expressed concern that this law could pave the way for a new financial crisis and accused the crypto industry of lobbying for its own interests.
This is reported by Finway
Criticism of the GENIUS Act and Parallels to the 2008 Crisis
According to Warren, the passage of the GENIUS Act creates a dangerous precedent where legislation is shaped by the industry itself rather than in the public interest. She compared the situation to the passage of the Commodity Futures Modernization Act in 2000, which she believes was one of the reasons for the 2008 financial crisis due to a lack of proper oversight over over-the-counter derivatives.
“When Washington works for the industry, only a handful of people get rich, while the rest of Americans pay the price,” Warren stated.
The senator emphasized that the need for cryptocurrency regulation is beyond doubt, but it must occur transparently and independently of industry lobbyists. She called it a grave mistake to pass laws that are written by representatives of the digital asset market.
Concerns About Stablecoin Safety and Trump’s Actions
Elizabeth Warren and economist Sergi Basco from the University of Barcelona believe that the GENIUS Act creates a false sense of security regarding stablecoins for the public. Basco stressed that if large companies issue such assets, people may mistakenly believe that all stablecoins are equally reliable. At the same time, the lack of sufficient oversight over stablecoin issuers could lead to bank runs even if these coins are backed by U.S. government bonds. Experts point out that even safe assets do not guarantee against collapse, as evidenced by the recent case of Silicon Valley Bank.
Warren has repeatedly criticized Donald Trump for his personal interest in cryptocurrencies and for actions that she believes increase risks in this area. In particular, she stated that Trump has turned the White House into a “crypto ATM” and accused him of launching his own cryptocurrency projects and weakening regulatory oversight.
It is worth noting that the meme coin TRUMP on the Solana blockchain was launched on January 18, 2025, and in June, the World Liberty Financial platform distributed stablecoins USD1 among WLFI token holders.
The senator also highlighted the record spending of the crypto industry on lobbying in Congress and compared it to the most active phases of bank influence on legislative power.
“This is a city where money talks. But the way the industry pushed this law goes beyond anything we’ve seen before,” Warren emphasized.