TLDR
- U.S. Treasury seeks public input on stablecoin rules under the GENIUS Act, focusing on taxes and financial stability.
- GENIUS Act allows foreign issuers to offer stablecoins in the U.S., but details remain unclear.
- Treasury asks for feedback on BSA, AML regulations for stablecoins amid growing digital finance concerns.
- Public comment period on GENIUS Act stablecoin rules ends October 20, 2025.
The U.S. Treasury Department has announced a second public comment period regarding its implementation of the GENIUS Act, the first crypto-specific legislation passed in the United States. This move is part of Treasury efforts to establish a comprehensive regulatory framework for payment stablecoins. The GENIUS Act, signed into law this past summer, aims to balance innovation with consumer protection, security, and financial stability.
Treasury Seeks Feedback on Stablecoin Legislation
The Treasury Department has issued a request for public input to refine the guidelines under the GENIUS Act. The department specifically seeks data and information from both industry insiders and critics. According to Treasury officials, this feedback will help shape the formal proposal that will govern payment stablecoins in the U.S.
The comment period is set to close on October 20, giving stakeholders ample time to provide their views on various aspects of the law. The Treasury is particularly interested in hearing about issues related to taxation, potential illicit finance risks, and financial stability concerns. The feedback will be crucial in developing a regulatory framework that addresses these issues without stifling innovation in the stablecoin sector.
Key Open Questions on the GENIUS Act Regulations
Several questions remain open as the Treasury moves forward with implementing the GENIUS Act. For example, the law does not address the federal income tax treatment of payment stablecoins, which may allow the IRS to interpret the law in various ways. This ambiguity leaves room for potential future tax policy decisions that could affect both users and issuers of stablecoins in the U.S.
Another area of concern is the ability of foreign issuers to offer stablecoins in the U.S. under the GENIUS Act. Although the legislation includes provisions that could enable this, it remains unclear when foreign-issued stablecoins will be allowed. The Treasury is seeking public feedback on how to regulate foreign stablecoin issuers and the possible risks they may pose to U.S. financial stability.
Considerations for Financial Oversight and Compliance
The Treasury is also focusing on how to balance state-level and federal oversight of stablecoins. Given the decentralized nature of the cryptocurrency market, it remains unclear how state regulators will collaborate with federal authorities. Another key question is how the Bank Secrecy Act (BSA), anti-money laundering (AML), and sanctions obligations should apply to stablecoin transactions.
The department has asked for comments on whether new marketing prohibitions should be introduced for stablecoins. These could involve restrictions on how stablecoin issuers and users promote or advertise their services, particularly in regard to potential illicit use. The Treasury is also examining the possibility of enforcing anti-money laundering regulations more rigorously to ensure that stablecoins are not used for illegal activities.
Treasury’s Ongoing Commitment to Stablecoin Regulation
As the U.S. Treasury continues to gather public comments, it remains committed to finalizing a regulatory framework that will guide the stablecoin industry. The feedback collected during this comment period will be integral in shaping the final regulations.
Treasury officials emphasize the importance of striking a balance between promoting innovation and ensuring that stablecoin operations remain secure, transparent, and compliant with U.S. laws.
Once finalized, the stablecoin regulations will provide clear guidelines for issuers, users, and regulators alike. These rules will play a crucial role in the evolution of the digital currency ecosystem in the U.S., ensuring that stablecoins can integrate seamlessly into the broader financial system.
