Blockchain Association Endorses GENIUS Act Framework
TREE NEWS reports: The Blockchain Association, a leading crypto advocacy group, has publicly supported the Treasury’s proposed rules under the GENIUS Act, which aim to regulate stablecoin issuers. In its formal comments, the association praised the overall framework but called for critical refinements, particularly around customer identification requirements and the definition of key terms.
Key Recommendations
The association’s primary argument is that client identification (KYC) obligations should be limited to direct issuer-customer transactions in the primary market. This would avoid imposing redundant and costly verification burdens on secondary market participants, such as exchanges and brokers, who already comply with existing AML/KYC regulations. The group also urged the Treasury to provide clearer definitions for terms like ‘payment stablecoin’ and ‘end-user’ to prevent regulatory ambiguity.
Industry Implications
If adopted, these clarifications would significantly reduce compliance complexity for stablecoin issuers and foster innovation. By restricting KYC to primary market transactions, issuers would have a clearer regulatory path, while secondary market platforms would not face duplicative obligations. This could accelerate the integration of stablecoins into mainstream financial systems, as clearer rules attract institutional players. However, the Treasury may push back on narrowing KYC scope, citing anti-money laundering and counter-terrorism financing concerns.
Forward-Looking Perspective
The GENIUS Act is part of a broader U.S. effort to establish a federal framework for stablecoins, competing with the EU’s MiCA and other international standards. The Blockchain Association’s engagement signals that the industry is willing to work with regulators to achieve a balanced outcome. The final rule will likely be a compromise, but the association’s push for clarity is a positive sign for the market. As stablecoins become more integral to global payments, regulatory certainty will be key to their long-term success.
