US Banks Push for Delay in Implementing Stablecoin Regulatory Framework

The cryptocurrency sector often finds itself at odds with bankers over regulatory matters, and this time, a coalition of bank trade associations has petitioned the US Department of the Treasury to extend the public consultation period for the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, enacted last year. In a letter addressed to the Treasury Department and the Federal Deposit Insurance Corp, US bankers are requesting that the comment periods for three separate GENIUS Act rule proposals be extended by at least 60 days after the completion of another rulemaking effort by the Office of the Comptroller of the Currency (OCC). The OCC's initiative to implement a rule for overseeing stablecoin issuers has significant implications for the outcome of other rules being developed by the Treasury's Office of Foreign Assets Control (OFAC) and the Financial Crimes Enforcement Network (FinCEN), 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 that the collective regulatory work is of "extraordinary scope and complexity." The banking organizations, including the American Bankers Association and the Bank Policy Institute, stated that their comments would be more comprehensive and useful to the agencies if they had sufficient time to evaluate the proposed rules together and assess each against the finalized OCC framework. Although the GENIUS Act is scheduled to be implemented by 2027, it is not uncommon for federal agencies to grant extensions for complex rules. The Treasury Department has not responded to a request for comment on the bank industry's request. Meanwhile, the same bankers are engaged in a debate with the crypto industry over stablecoin regulation, which has already delayed the Digital Asset Market Clarity Act for months and potentially jeopardized its chances of becoming law this year.