Banks Urge Caution on Implementation of GENIUS Act for Stablecoin Regulation

The cryptocurrency sector is once again seeing bankers play a key role in its top regulatory priorities, with a coalition of bank trade associations now requesting that the US Department of the Treasury extend the public consultation period for the implementation of the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, enacted last year. In a letter to the Treasury Department and the Federal Deposit Insurance Corporation, US bankers are seeking extended comment periods for three GENIUS Act rule proposals, to commence at least 60 days after the completion of another rulemaking effort by the Office of the Comptroller of the Currency. The OCC's stablecoin issuer policing rule is crucial to the outcome of other rules being developed by the Treasury's Office of Foreign Assets Control and the Financial Crimes Enforcement Network, as well as a related rulemaking at the FDIC. The bankers argue that all these efforts are directly contingent on the OCC's final framework and represent a regulatory undertaking of extraordinary scope and complexity. The banking organizations, including the American Bankers Association and the Bank Policy Institute, stated that their comments will be more comprehensive and useful to the agencies if they have sufficient time to evaluate the proposed rules together and against the finalized OCC framework. The GENIUS Act is slated to be in place by 2027, although it is not uncommon for federal agencies to grant extensions for complex rules. The same bankers are also engaged in a stablecoin-related debate with the crypto industry, which has already delayed the Digital Asset Market Clarity Act for months and potentially jeopardized its chances of becoming law this year.