US Banks Push for Delay in Implementing Stablecoin Regulations Under GENIUS Act

The cryptocurrency sector often finds itself at odds with bankers over regulatory matters, and this time, a coalition of banking trade associations has petitioned the US Department of the Treasury to prolong 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 addressed to the Treasury Department and the Federal Deposit Insurance Corporation, US bankers have requested that the comment periods for three separate GENIUS Act rule proposals be extended to 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 its rule for overseeing stablecoin issuers has significant implications for the outcome of other rules being pursued by the Treasury's Office of Foreign Assets Control (OFAC) and the Financial Crimes Enforcement Network (FinCEN), as well as a related rulemaking by the FDIC. According to the bankers, all these efforts are "directly contingent upon the OCC's final framework," and, combined with regulatory proposals yet to emerge from the Federal Reserve and other agencies, they constitute "a body of regulatory work of extraordinary scope and complexity." The banking organizations, including the American Bankers Association and the Bank Policy Institute, argue that their comments will be more comprehensive and useful to the agencies if they have sufficient time to evaluate the proposed rules together and assess each against the finalized OCC framework. Although the GENIUS Act is slated to be in place by 2027, it is not uncommon for federal agencies to grant extensions for complex rules. The Treasury Department has not immediately responded to a request for comment on the bank industry's request. Meanwhile, the same bankers are engaged in a stablecoin-related dispute with the crypto industry, which has already delayed the Digital Asset Market Clarity Act for months and may potentially jeopardize its chances of becoming law this year.