US Senate Passes Stablecoin Bill in Milestone for Crypto Industry

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The U.S. Senate on Tuesday approved the GENIUS Act, a bipartisan bill establishing the first federal regulatory framework for stablecoins—cryptocurrency tokens pegged to the U.S. dollar. The bill passed with a vote of 68-30, marking a significant step toward formal oversight of a rapidly growing sector in digital finance.

Stablecoins, which maintain a steady value typically linked 1:1 to the dollar, are widely used by crypto traders for quick transfers between tokens and are increasingly considered for instant payments. If signed into law, the legislation would require stablecoin issuers to back tokens with liquid assets like cash or short-term Treasury bills and publicly disclose reserve compositions monthly.

The crypto industry has advocated for clear regulation, believing it could boost adoption and investor confidence. However, concerns remain among some Democrats and financial watchdogs that the bill could enable big tech firms to issue private stablecoins without sufficient anti-money laundering safeguards or protections against foreign issuers.

The bill now moves to the Republican-controlled House, which must pass its own version before it can be signed by President Donald Trump. Trump’s White House advisers have emphasized a desire to enact stablecoin rules by August.

Critics have also highlighted potential conflicts of interest related to Trump’s own crypto ventures, including a meme coin and a crypto company partly owned by him, though the White House maintains that his assets are held in a trust.

The Conference of State Bank Supervisors has called for amendments to prevent expanding the authority of uninsured banks without state oversight.

Despite these debates, legal experts hail the Senate’s approval as a landmark moment in regulating a fast-evolving financial technology.

Elon Musk’s xAI Set to Raise $5 Billion Debt Despite Tepid Investor Interest

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Elon Musk’s AI startup, xAI, is poised to close a $5 billion debt financing led by Morgan Stanley, although investor demand has been notably modest, according to sources familiar with the matter. The debt package includes a floating-rate term loan, a fixed-rate loan, and secured bonds, with allocations scheduled for Wednesday.

The floating-rate loan carries an interest rate of 700 basis points above the Secured Overnight Financing Rate, while the fixed-rate loan and secured notes offer yields near 12%, significantly higher than the current 7.6% average yield for high-yield bonds. This elevated cost reflects the risks investors associate with xAI’s unrated debt and lack of profitability to date.

Several potential investors declined to participate, citing concerns over xAI’s financial transparency and Musk’s previous financing history. Notably, Musk’s 2022 $44 billion acquisition of Twitter involved $13 billion in loans that lenders had to retain on their balance sheets for two years due to poor secondary market demand.

While the debt issuance was fully subscribed, total orders amounted to roughly 1.5 times the amount offered, below the typical 2.5 to 3 times seen in similar junk bond offerings. Unlike Musk’s Twitter debt deal—where banks guaranteed the sale and committed capital—this transaction is structured as a “best efforts” deal with no such guarantees from Morgan Stanley.

Beyond debt, xAI is also reportedly pursuing a $20 billion equity raise that could value the company above $120 billion, with some investors estimating up to $200 billion.

Latin American Countries to Launch Latam-GPT AI Model in September

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A coalition of a dozen Latin American countries is set to launch Latam-GPT, the region’s first large-scale AI language model designed specifically to understand and reflect Latin America’s cultural and linguistic diversity. The project, led by Chile’s National Center for Artificial Intelligence (CENIA) and involving over 30 regional institutions, aims to increase AI accessibility and adoption across the continent.

Chilean Science Minister Aisen Etcheverry described Latam-GPT as a “democratizing element for AI,” envisioning its use in sectors such as education and healthcare, with technology that resonates with local culture and languages. Development began in January 2023, focusing on addressing the limitations and inaccuracies found in global AI models primarily trained in English.

Rather than competing directly with commercial AI services like ChatGPT, Latam-GPT is intended as foundational technology to power regional applications including chatbots. One of its highlighted objectives is the preservation of Indigenous languages. The model already includes a translator for Rapa Nui, the native language of Easter Island, with plans to expand support to other Indigenous tongues for use in virtual public service assistants and personalized education tools.

Built on Llama 3 AI technology, the model is trained via a network of computers spanning regional institutions such as Chile’s University of Tarapaca and cloud infrastructure. Support has come from the Latin American development bank CAF and Amazon Web Services.

Although the project currently operates without a dedicated budget, CENIA’s director Alvaro Soto is optimistic that demonstrating Latam-GPT’s capabilities will help secure future funding.