Financial Institutions Request Delay in Implementation of Stablecoin Regulatory Framework

The cryptocurrency sector often involves bankers in its key regulatory endeavors, and this time, a coalition of banking 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 sent to the Treasury Department and the Federal Deposit Insurance Corporation this week, US bankers are requesting that the comment periods for three GENIUS Act rule proposals be extended to at least 60 days after the Office of the Comptroller of the Currency (OCC) completes its rulemaking process. The OCC's effort to implement its rule for overseeing stablecoin issuers 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.

According to the bankers, all these efforts are 'directly contingent on the OCC's final framework.' The collective regulatory work, along with proposals that have not yet emerged from the Federal Reserve and other agencies, 'represents a body of regulatory work of extraordinary scope and complexity.' The banking organizations, including the American Bankers Association and the Bank Policy Institute, stated that their comments 'will necessarily be more comprehensive, and therefore more useful to the agencies, if we have sufficient time to evaluate the proposed rules together and to evaluate each against the finalized OCC framework.' The GENIUS Act is scheduled to be in place by 2027, although it is not uncommon for federal agencies to grant extensions for complex rules. The Treasury Department did not immediately respond to a request 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 so far delayed the Digital Asset Market Clarity Act for months and potentially jeopardized its chances of becoming law this year.