US Treasury Department seeks public comment on applying GENIUS Act stablecoin rules

The U.S. Treasury Department is seeking public comment on its implementation of the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, the first crypto-specific legislation passed into law in the United States this past summer.

"The GENIUS Act tasks Treasury with issuing regulations that encourage innovation in payment stablecoins while also providing an appropriately tailored regime to protect consumers, mitigate potential illicit finance risks, and address financial stability risks," Treasury officials wrote in a press release out late Thursday.

In particular, the Treasury is looking for data and other information that could help tailor its guidelines under the GENIUS Act as the federal agency puts together a formal proposal. This includes comments from critics as well as industry insiders. The comment period will close on Oct. 20.

For instance, Treasury officials note that the GENIUS Act "does not address the federal income tax characterization of payment stablecoins," potentially leaving room for the IRS to interpret the law. Similarly, GENIUS includes a provision that could enable foreign issuers to offer a stablecoin in the U.S., though it remains unclear when this would be allowed.

Other open questions include whether there should be marketing prohibitions, how to balance state-level and federal oversight, as well as where to apply the Bank Secrecy Act (BSA), anti-money laundering (AML), and sanctions obligations.

Last month, the department put out a specific request for comment related to detecting illicit use of digital assets.

GENIUS passed both Republican-led chambers of the U.S. Congress in July with the backing of President Donald Trump, who said he wanted stablecoin legislation on his desk to sign by August as part of his executive authority to reform the U.S. regulatory environment.