Banks Push for Delay in Implementing Stablecoin Oversight Under GENIUS Act

The cryptocurrency industry often finds itself at odds with bankers over regulatory matters, and now a coalition of bank trade associations is urging the US Department of the Treasury to extend the public consultation period for the implementation of the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, which was passed last year. In a letter sent to the Treasury Department and the Federal Deposit Insurance Corp, US bankers are requesting that the comment periods for three separate rule proposals under the GENIUS Act be extended to at least 60 days after the Office of the Comptroller of the Currency (OCC) finalizes its own rule for regulating stablecoin issuers. The OCC's rule is crucial to 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, claim that they need sufficient time to evaluate the proposed rules together and against the finalized OCC framework in order to provide comprehensive and useful comments to the agencies. The GENIUS Act is scheduled to come into effect by 2027, although it is not uncommon for federal agencies to grant extensions for complex rules. The Treasury Department has not yet responded to a request for comment on the bank industry's request. Meanwhile, the same bankers are also 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 put its passage into law this year at risk.