The GENIUS Act: A Threat to Freedom, By Chris Knight (Florida)

The GENIUS Act of 2025, signed into law by President Donald Trump on July 18, 2025, is being heralded by its supporters as a revolutionary step toward modernising finance through stablecoins, digital currencies pegged to the U.S. dollar. However, a closer examination reveals it as a dangerous overreach that undermines constitutional protections, threatens individual privacy, and lays the groundwork for an authoritarian control grid. Far from the "massive validation" of innovation Trump claimed at the signing ceremony, the act could erode the very freedoms he campaigned to protect.

Stablecoins as CBDCs in Disguise

During his 2024 campaign, Trump vowed to ban central bank digital currencies (CBDCs), citing their potential for government overreach and surveillance. Yet, the GENIUS Act, which stands for Guiding and Establishing National Innovation for U.S. Stablecoins, effectively introduces a digital dollar under the guise of private-sector innovation. Stablecoins, as defined by the act, are issued by private entities like banks and fintech firms, but are subject to stringent federal regulations, including full reserve backing and compliance with anti-money laundering laws.

Critics, including Bitcoin Magazine's Editor-in-Chief Mark Goodwin, argue that stablecoins are functionally identical to CBDCs. "Stablecoins can be programmed. Exactly like how we fear CBDCs will be programmed. They can be taken out of your wallet. Your wallet can be blacklisted," Goodwin explains. The act mandates that issuers have the technical capability to seize, freeze, or burn stablecoins when legally required, granting the government unprecedented control over private financial transactions.

This contradicts Trump's February 2025 executive order opposing CBDCs, exposing a bait-and-switch that could enable the same surveillance and control he publicly decried. By allowing private corporations to issue stablecoins under federal oversight, the act outsources CBDC-like functionality to entities like JPMorgan Chase, which is already launching its own stablecoin-like token, JPMD.

Confiscation Without Due Process

The GENIUS Act's most alarming provision is its empowerment of federal and state authorities to freeze digital accounts for violations of executive branch regulations, without due process. The act explicitly states that stablecoin issuers, treated as financial institutions, must "block, freeze, and reject specific or impermissible transactions that violate Federal or State laws, rules, or regulations." This could include regulations like the 2021 COVID vaccine mandates issued by the Department of Health and Human Services, which required vaccination for employees at federally funded healthcare facilities.

Freezing accounts effectively confiscates all assets, earned or inherited, without judicial oversight, violating the Fifth Amendment's guarantee of due process. For example, during the 2021 mandates, unvaccinated workers could have lost access not only to their income but also to their savings, leaving them financially paralysed. Such measures, enacted by executive whim rather than congressional legislation, could be wielded against dissenters, protesters, or anyone deemed non-compliant with federal or state directives, such as restrictions on public gatherings or biometric ID requirements.

A Surveillance State in the Making

The GENIUS Act is a cornerstone of a broader control grid that threatens Fourth Amendment protections against unreasonable searches. By requiring stablecoin issuers to comply with the Bank Secrecy Act and implement anti-money laundering and sanctions compliance programs, the government gains the ability to monitor every transaction in real time. Combined with other initiatives, like Real ID biometric identification and AI-driven data centres, the act enables a system where every financial move, location, and behaviour is tracked and evaluated.

Catherine Austin Fitts, former Assistant Secretary of Housing and Urban Development, warns that this infrastructure mirrors China's social credit system. "The guys who own the New York Fed are all going to create subsidiaries and issue stablecoin which will be interoperable and can work with a social credit system," she notes. High-resolution street cameras and AI analytics could assign extrajudicial "social credit scores," determining access to financial services based on behavior, further eroding privacy.

Neel Kashkari, president of the Minneapolis Federal Reserve, highlighted the risks in 2022, stating that a CBDC would allow the government to "monitor every one of your transactions. I get why China would be interested. Why would the American people be for that?" The GENIUS Act's stablecoins, with their programmability and federal oversight, pose the same threat, enabling an authoritarian surveillance state under the pretext of financial innovation.

Conflicts of Interest and Corruption Concerns

The act's passage raises questions about conflicts of interest, particularly given the Trump family's ties to World Liberty Financial, a crypto firm that issued its own stablecoin, USD1. While the GENIUS Act bans members of Congress and their families from profiting off stablecoins, it conspicuously exempts the president and his family, who stand to gain significantly from the growing $260 billion stablecoin market. Democratic Senators Jeff Merkley and Elizabeth Warren have criticised this omission, accusing the act of "rubberstamping Trump's crypto corruption."

The crypto industry's $265 million in campaign contributions during the 2024 election cycle further fuels concerns about undue influence. Critics like Bartlett Naylor of Public Citizen argue that these funds "converted some elected politicians to a pro-crypto stance," undermining the legislative process.

A Betrayal of Campaign Promises

Trump's signing of the GENIUS Act contradicts his campaign pledge to protect American freedoms by banning CBDCs. Instead, it delivers a digital dollar that centralises financial control, enables asset confiscation without due process, and paves the way for mass surveillance. The act's bipartisan support, 308-122 in the House and 68-30 in the Senate, masks its dangers, as it was pushed through during a tumultuous "Crypto Week" marked by GOP infighting and compromises, such as tying anti-CBDC provisions to unrelated defence legislation.

The irony is stark: a president elected to dismantle the "deep state" is advancing a system that could empower it. As Fitts warns, "He is moving very, very fast" to build a control grid that could "eliminate all privacy." The GENIUS Act, far from being a triumph of innovation, is a Trojan horse that threatens the constitutional liberties it claims to advance.

Thus, the GENIUS Act of 2025 is not the financial revolution its supporters claim but a dangerous step toward centralised control and surveillance. By enabling asset freezes without due process, facilitating real-time transaction monitoring, and aligning with a broader control grid, it undermines the Fourth and Fifth Amendments. Trump's betrayal of his anti-CBDC promise, coupled with his family's financial stake in the crypto industry, raises serious ethical questions. Americans must demand transparency and accountability to prevent this "genius" act from destroying the freedoms it was meant to protect.

https://lionessofjudah.substack.com/p/while-you-were-distracted-trumps