The US Department of the Treasury has unveiled a proposal that would require stablecoin firms to establish stringent controls to prevent and report suspicious transactions, in line with the Bank Secrecy Act. The proposed rules, which are open for public comment, aim to regulate stablecoin issuers similarly to traditional financial institutions, with a focus on effectiveness and allowing companies to identify and manage their own risks. The regulations would require stablecoin issuers to implement measures to halt flagged transactions, devote more resources to high-risk customers and activities, and cooperate with authorities in pursuing targets. The rules also emphasize the importance of risk-based safeguards for stablecoin activity on primary and secondary markets, and the need to detect and reject transactions that may violate US sanctions.
The proposal is part of the US government's efforts to establish a regulatory framework for stablecoins, following the passage of the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act. The regulations are expected to be finalized by 2027, and companies are already taking steps to comply, with some pursuing charters and partnerships to get involved in the stablecoin market.