The STABLE GENIUS Act prohibits federal candidates and officeholders from trading or holding digital assets like cryptocurrency while campaigning or serving, unless placed in an approved blind trust.
Joe Neguse
Representative
CO-2
The STABLE GENIUS Act prohibits federal candidates and officeholders from trading or holding digital assets like cryptocurrency while running for or serving in office. This measure aims to prevent conflicts of interest by banning covered individuals from buying, selling, or sponsoring these investments during specific timeframes. Officials may only retain assets by placing them into an approved, strictly managed qualified blind trust. Violators face significant civil penalties, and knowing, large-scale violations can result in criminal prosecution and imprisonment.
Crypto Ban for Congress: STABLE GENIUS Act Forces Officials to Sell Digital Assets Within Six Months of Taking Office
The aptly named STABLE GENIUS Act—which stands for the Stop Trading Assets Benefitting Lawmakers' Earnings while Governing Exotic and Novel Investments in the United States Act—is a serious attempt to shut down conflicts of interest involving digital assets like cryptocurrency among top federal officials.
The Digital Asset Lockdown
This bill targets “covered individuals,” which means anyone running for or holding the office of President, Vice President, U.S. Senator, or U.S. Representative. The core rule is simple: if you’re a covered individual, you cannot buy, sell, hold, issue, or endorse any “covered investment.” A covered investment is defined broadly as any digital asset recorded on a secure, distributed ledger—think Bitcoin, Ethereum, or whatever the next big crypto thing is. This ban is active while you’re running for office, throughout your entire term, and for a full year after you leave the job. If you’re a candidate who owns crypto, you must divest or put it into a blind trust before you even get elected.
The Six-Month Sell-Off Clock
What if a newly elected official already owns a significant amount of crypto? The bill offers one narrow escape hatch: the “qualified blind trust.” But this isn't your grandpa's blind trust. To comply, the official must place their digital assets into a trust specifically approved by the relevant ethics office. The trustee then has a hard deadline: they must sell off every single covered asset within six months of the trust being established. This rule forces a complete, rapid liquidation. For an official who might have invested heavily in digital assets, this means they could be forced to sell at an unfavorable time, essentially trading their investment flexibility for public trust. The ethics offices must also post the details of these trust agreements publicly, adding a layer of transparency.
Real-World Stakes and Penalties
For the average person, this bill aims to ensure that the people writing the rules about digital assets—things like stablecoin regulation or crypto taxation—aren't simultaneously making personal fortunes based on those decisions. If an official votes on a bill that tanks a specific crypto coin, the public needs assurance that they aren't shorting that same coin on the side.
The penalties for breaking these rules are severe. If an official knowingly engages in a prohibited transaction, they face a civil penalty of up to $250,000, plus they have to give back any profit they made to the U.S. Treasury. But it gets worse: if the violation is knowing and causes a loss of over $1 million to others, or if the official financially benefits, they face criminal charges, including potential imprisonment for up to 18 years. Crucially, the bill also states that any conduct related to these prohibited financial transactions is not covered by official immunity. In plain English, if you break this rule, your job title won't protect you from prosecution.