US Banking Groups Push for Delay in Implementing Stablecoin Regulation Under GENIUS Act

The US banking sector has become increasingly involved in the regulatory efforts of the crypto industry, with a recent request by a coalition of bank trade associations to 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. This request comes as multiple federal agencies are swiftly moving forward with stablecoin regulations, making it challenging to comprehend how these rules will interact with one another. In a letter addressed to the Treasury Department and the Federal Deposit Insurance Corp, the bankers are seeking extended comment periods for three GENIUS Act rule proposals, ideally for at least 60 days after the Office of the Comptroller of the Currency (OCC) concludes its rulemaking effort. The OCC's push to implement its rule for overseeing stablecoin issuers holds 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 at the FDIC. The bankers argue that all these efforts are directly contingent on the OCC's final framework and represent a complex and extensive body of regulatory work. The banking organizations, including the American Bankers Association and the Bank Policy Institute, emphasize that having sufficient time to evaluate the proposed rules together and against the finalized OCC framework will enable them to provide more comprehensive and useful comments to the agencies. The GENIUS Act is slated to be in place by 2027, although extensions of comment periods for complex rules are not uncommon. The Treasury Department has not yet 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 led to delays in the Digital Asset Market Clarity Act and potentially jeopardized its chances of becoming law this year.