The Blockchain Association has formally supported the GENIUS Act, advocating for greater clarity and realistic compliance obligations in the proposed stablecoin regulations in the United States. The industry group submitted a comment letter on Friday, responding directly to draft rules from the Financial Crimes Enforcement Network, the Office of the Comptroller of the Currency, the Federal Reserve, the Federal Deposit Insurance Corporation, and the National Credit Union Administration.
GENIUS Act and Stablecoin Issuer Framework
The GENIUS Act proposes the establishment of a federal system for payment stablecoins in the US. The legislation aims to define which organizations may issue stablecoins, dictate the types of assets that should back these coins, and specify the processes customers must use to redeem their holdings.
Under the GENIUS Act, entities approved as payment stablecoin issuers must implement a robust customer identification program (CIP). This requirement is designed to prevent illicit activities and ensure proper oversight of entities issuing stablecoins.
The Blockchain Association, a leading advocacy group representing the cryptocurrency industry, outlined its position on the customer identification scope. It argued that CIP requirements should apply only to primary market transactions between stablecoin issuers and their direct customers.
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AAPLThis focus means that peer-to-peer and secondary market transactions would generally not fall within the issuer’s customer identification obligations. According to the association, this approach would prevent stablecoin issuers from being compelled to determine the identities of all subsequent transactors after coins are issued.
Mini dictionary: Blockchain Association, a US-based industry group that advocates for regulatory clarity, innovation, and responsible adoption of cryptocurrencies and blockchain technologies.
Appeal for Clearer Regulatory Definitions
The Blockchain Association called on federal regulators to offer precise definitions for terms such as “account,” “customer,” and “digital asset service provider.” The organization asserted that such clarity would help reduce ambiguity for companies seeking to comply with regulatory standards.
It also recommended that activities such as one-time redemptions and services unrelated to stablecoin issuance be explicitly exempt from onerous compliance requirements. The association argued that regulatory obligations must not overlap and should allow stablecoin issuers to exercise sufficient flexibility in meeting identification standards, provided they comply with the GENIUS Act.
“The GENIUS Act created a landmark framework for payment stablecoins. Implementation should preserve its goals: strong safeguards, workable rules, and room for continued innovation.”
Additionally, the Blockchain Association suggested that federal agencies coordinate the effective dates for customer identification rules with forthcoming anti-money laundering (AML) standards mandated by the legislation.
Industry Perspective on Stablecoin Innovation
The Blockchain Association described the GENIUS Act as a vital step forward in regulating payment stablecoins in the United States. The association maintained that a balanced approach is essential, supporting innovation while also establishing protections for users and the financial system.
US regulators have been actively working to outline stablecoin regulatory frameworks, and a finalized system is expected to play a significant role in shaping conditions for issuers nationwide.
Preserving the intent of the GENIUS Act, strong operational safeguards, pragmatic rules, and a foundation for ongoing digital asset innovation remain central priorities for industry stakeholders.
Market participants continue to monitor upcoming legislation as federal agencies consider industry input ahead of finalizing customer identification and AML rules for stablecoin issuers.
