On the 19th of October, the National Cryptocurrency Association (NCA) submitted recommendations to the U.S. Treasury on implementing the GENIUS Act.
According to the letter, NCA’s main concern is ensuring that ordinary Americans who already own stablecoins are not unfairly affected by changes in regulations.
The NCA’s proposed GENIUS Act rules
For that, the NCA argues that stablecoin holders should not lose access to their funds when a stablecoin becomes ineligible for issuance.
Here, it wants the U.S. Treasury to establish a transition period allowing existing holders to redeem, sell, or convert their stablecoins. They want this to continue even after platforms have stopped offering them for new purchases. This would apply when temporary waivers expire, state certifications change, or when the 18th of July, 2028, deadline arrives.
Additionally, the NCA also recommends publicly disclosing regulatory changes and deadlines to ensure consumers receive advance notice.
Secondly, the NCA wants clear rules allowing stolen stablecoins to be recovered and returned to victims through lawful orders. It argues that issuers should be permitted to reissue stablecoins when legally required, without regulatory uncertainty obstructing recovery efforts.
Finally, the NCA urges the Treasury to establish clear protections and regulatory boundaries for self-custody wallets and peer-to-peer transfers. So, overall, it wants stricter stablecoin regulation to be implemented without unfairly restricting existing holders’ access to funds or undermining consumer protection.
Applauding the move, Ripple’s CLO Stuart Alderoty noted,
The Blockchain Association echoes similar sentiment
At the same time, the Blockchain Association (BA) has submitted a comment letter to the U.S. Treasury on proposed GENIUS Act regulations. While supporting safer stablecoins, regulated issuers, and adequate reserves, the BA warns that the rules could impose excessive compliance burdens on crypto companies, exchanges, and DeFi platforms.
Therefore, the BA wants regulators to distinguish service providers so that no firms are unnecessarily regulated. Additionally, the BA wants platforms to rely on official government lists to verify foreign stablecoin issuers rather than conducting extensive investigations.
This, and it opposes impractical requirements to identify or track anonymous users on decentralized networks. And, lastly, it seeks clearer rules for algorithmic stablecoins, token bridges, and wrapped tokens.
Interestingly, both of these please followed the U.S. Federal Reserve recently proposing two sets of rules under the GENIUS Act.
Final Summary
- The NCA wants stricter stablecoin regulation to be implemented without unfairly restricting existing holders’ access to funds.
- The BA warns that the rules could impose excessive compliance burdens on crypto companies, exchanges, and DeFi platforms.
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