For many, the passage of the GENIUS Act closed the door to the creation of Central Bank Digital Currency (CBDC). Stablecoins, while also digital assets, are promoted as a form of private currency, distinct from government-issued digital dollars.
Aaron Day, a fellow at the Brownstone Institute and a vocal critic of the crypto industry, argues that the GENIUS Act effectively facilitates increased government oversight, even though the law prohibits the issuance of CBDCs.
Concerns about surveillance under the GENIUS Act
The GENIUS Act explicitly stipulates that the Federal Reserve is not permitted to issue CBDCs directly to individuals or through third parties. The goal is to prevent any possibility of a government-issued digital dollar.
This law, passed in July 2025, aligns closely with President Trump's early campaign promises, where he called CBDCs an act of dictatorship and vehemently opposed the emergence of a national digital currency.
According to Mr. Day, stablecoins and CBDCs are essentially not very different. The difference is that stablecoins are issued by private entities, while CBDCs are issued by central banks . However, if the government remains involved in regulation, the level of oversight will be the same.
“Issuance by the Federal Reserve isn’t necessarily something to worry about. The Federal Reserve is a private institution that brings together many banks . Whether the stablecoin is issued by Jamie Dimon of JP Morgan Chase or by the Federal Reserve, it makes no difference,” Day Chia BeInCrypto.
According to him, what worries those concerned about privacy is the possibility that a government agency could program, track, and control financial transactions .
This observation led him to call the GENIUS Act a “backdoor CBDC.” Day also emphasized the urgency of this issue, especially as stablecoins are experiencing explosive growth.
“Last year, the total value of stablecoin transactions reached $33 trillion. That’s more than the amount of transactions made through Visa globally,” he Chia . “What they’re doing is essentially putting stablecoins under the scrutiny and control of Congress.”
According to Day, this level of oversight Capital existed before the GENIUS Act was enacted. The new law simply increased the level of control within an already established Capital .
Government surveillance tools have been deployed.
Mr. Day pointed out that the majority of dollars today are already digital currency.
When asked for a practical example, he mentioned the Bank Secrecy Act (BSA) . This act, passed in 1970, requires financial institutions to assist authorities in detecting and preventing money laundering, terrorist financing, and other illegal activities.
According to Day, the BSA allows government agencies to expand their powers in certain circumstances.
"We have what's called suspicious activity reporting. Any transaction of $10,000 or more through a bank is automatically reported to the U.S. Treasury Department. This shows that the system now has a tracking mechanism in place," he explained.
Although these tools are typically aimed at protecting citizens, government agencies can implement them without specific authorization.
Mr. Day gave a very specific example: In March 2025,the Financial Crime Enforcement Network – an agency of the U.S. Treasury Department – issued a geographic surveillance order to prevent money laundering along the U.S. Southwest border.
Accordingly, FinCEN requires financial services providers in 30 postcodes to report transactions exceeding $200.
"Do you understand what this means? The Treasury Department only needs a Mnemonics, no parliamentary approval, no law passed, and the banks will automatically adjust their dollar transaction levels to report to the Treasury Department," he said.
Based on the examples above, Mr. Day argues that regulatory frameworks already exist. The GENIUS Act merely legalizes Congress's oversight of stablecoins, thereby expanding control over digital assets that closely resemble CBDCs.
