Financial Institutions Request Delay in Implementing Stablecoin Regulatory Framework

The banking sector is increasingly involved in the cryptocurrency industry's key regulatory initiatives, with a coalition of bank trade associations recently urging the US Department of the Treasury to extend the public consultation period for the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act. In a letter addressed to the Treasury Department and the Federal Deposit Insurance Corporation, US bankers have requested a 60-day extension for commenting on three separate rule proposals under the GENIUS Act, following the completion of another rulemaking effort by the Office of the Comptroller of the Currency (OCC). The OCC's stablecoin issuer policing rule is crucial to the outcome of other regulations 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 contingent upon the OCC's final framework and represent an unprecedented scope and complexity of regulatory work. The collective comments from banking organizations, including the American Bankers Association and the Bank Policy Institute, will be more comprehensive and useful to agencies if they have sufficient time to evaluate the proposed rules together and against the finalized OCC framework. Although the GENIUS Act is set to be implemented by 2027, federal agencies often grant extensions for complex rules. The Treasury Department has not responded to requests for comment on the bank industry's request. The same bankers are also engaged in a stablecoin-related debate with the crypto industry, which has delayed the Digital Asset Market Clarity Act for months and potentially jeopardized its chances of becoming law this year.