As the various federal banking agencies race to establish separate regulations for stablecoin issuers, they should be open to reproposing any rule that conflicts with a regulation put forward by another agency, the American Bankers Association and three banking associations said Monday.
The Federal Reserve, FDIC, Office of the Comptroller of the Currency and National Credit Union Administration are each drafting their own rules to implement the Genius Act, which established a regulatory framework for payment stablecoins. In addition, the Financial Crimes Enforcement Network and the Office of Foreign Assets Control have proposed rules to implement Bank Secrecy Act and sanctions requirements for issuers.
In a joint letter to the banking agencies, the associations said there has been little coordination among the agencies, with separate proposals having different public comment deadlines. Coordination is particularly important given the potential risks posed by stablecoins, and for ensuring all issuers are subject to equal regulatory treatment, they said.
“Such coordination is not only required by the Genius Act, it is also critical to ensure that the [stablecoin issuer] regulatory framework does not create an unlevel playing field or opportunities for regulatory arbitrage, unintended policy consequences, or unworkable or incongruous requirements,” they said.
As the agencies have already declined to coordinate their deadlines, the associations recommended they commit to reproposing for comment any aspects of their respective proposals that are inconsistent or conflict with one another.
“This step would help ensure that the regulatory framework for all types of payment stablecoin issuers is sufficiently robust and appropriately balances innovation with safety and soundness and financial stability, protects against illicit finance, and discourages regulatory arbitrage,” they said. “It also would provide the public with appropriate opportunity to comment on the proposed consistent regulatory framework.”
