The US Department of the Treasury formally introduced a proposed rulemaking for stablecoins this Monday, marking a significant step toward executing the GENIUS Act, which was passed by Congress last year. The proposal seeks to define the scope and application of stablecoin issuance activities within the United States, offering much-needed regulatory clarity to the industry.
Treasury Secretary Scott Bessent stated in a release that authorities are expediting the implementation of these rules to provide the regulatory certainty businesses require for innovation. He emphasized that this effort aims to reinforce the dollar's status as the world's reserve currency and sustain America's leading position as a global cryptocurrency hub. Under the proposal, the Treasury treats stablecoins as an emerging regulatory domain while drawing on existing securities law frameworks for guidance on the issuance, sale, and cross-border activities of financial instruments.
The proposal further notes that the legislation explicitly requires payment stablecoins to function effectively as payment and settlement tools, including in cross-border scenarios. It warns that directly applying traditional investment rules could conflict with this objective. This latest proposal follows a preliminary notice issued by the Treasury last September, and stakeholders, including stablecoin issuers, will have a 60-day window to submit comments before the department spends several months reviewing feedback and publishing a final rule.
The proposal solicits industry input on several specific interpretive questions, with the regulatory treatment of foreign issuers, such as industry heavyweight Tether, likely to draw significant attention. The comment period closes in mid-October. According to the statute, the rules were due for completion by last month, but authorities missed that deadline. The next critical milestone is January 18 next year, when the act officially takes effect. Given the likelihood that all rules will not be finalized by then, new regulations typically include a transition period for industry adaptation.
Currently, the GENIUS Act's implementation intersects with the congressional push for the Digital Asset Market Clarity Act. The latter seeks to amend certain provisions of the GENIUS Act, particularly concerning how exchanges handle stablecoin customer reward programs. However, that bill failed to secure a critical vote earlier this month before the Senate's August recess, leaving its forward progress uncertain.
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