In a recent advanced notice of proposed rulemaking, the Treasury Department is seeking public comment related to its implementation of the Guiding and Establishing National Innovation for U.S. Stablecoins, or Genius, Act.
The GENIUS Act establishes procedures for institutions seeking licenses to issue stablecoins and establish regulatory standards for stablecoin issuers. According to the Treasury, while the most recent request for comment does not implement new requirements under the act, it offers the public an opportunity to contribute to the implementation of the law.
Following passage of the act, ABA President and CEO Rob Nichols reiterated the need for stablecoin regulation to balance the potential of the technology with limits on its possible negative consequences. “While the framework established in the GENIUS Act seeks to create that regulatory perimeter and spur innovation, stablecoins continue to risk disintermediating core bank activity like deposit taking and lending, which could undermine the fundamental role banks play in making loans to consumers and businesses,” Nichols said.
Nichols said ABA will continue its advocacy on stablecoin issues, including through the rulemaking process, “to ensure credit is not restrained by incentivizing value be held in payment stablecoin rather than bank deposits.”
Comments will be open for 30 days after publication in the Federal Register. Treasury added that this notice builds on the request for comment on “Innovative Methods to Detect Illicit Activity Involving Digital Assets” issued on Aug. 18, which remains open for comment until Oct. 17.
