The Blockchain Association has weighed in on Treasury’s proposed stablecoin rule. Its verdict amounts to: good start, now please fix the fine print.
The crypto advocacy group filed a comment letter with the US Department of the Treasury on October 19, 2026. That was the final day for public input on the proposal. The rule would implement Section 3 of the GENIUS Act, the federal law that sets the ground rules for payment stablecoins.
The association backed Treasury’s push for regulatory clarity. It also flagged several areas where it believes the draft could overreach. It wants the final version to track more closely with what Congress intended, without saddling platforms and foreign issuers with excessive liability or compliance costs.
What the Blockchain Association actually asked for
Treasury’s proposed rule was published around August 18, 2026. Its job is to define who counts as issuing and selling payment stablecoins in the US, and what is prohibited.
A central piece is the definition of “issuance.” Treasury describes it as the initial transfer that grants someone rights to a payment stablecoin. The rule applies when either the issuer or the recipient is in the US.
Its letter focused on four main pressure points:
Who counts as a platform. The group wants the term “digital asset service provider” limited to entities that actually provide services to customers. Under its proposal, self-custody software and certain trading firms would fall outside the definition.
Criminal liability. The association questioned the standards for criminal liability tied to unlawful stablecoin issuance.
Foreign issuers. The group raised the treatment of stablecoins issued overseas. As of mid-October 2026, no foreign issuer comparisons had been issued under the GENIUS Act framework.
Decentralized environments. The letter addressed how location-based tests would work for decentralized systems, which do not neatly map onto national borders.
Beyond those four areas, the association made three more specific requests. It urged Treasury to drop an open-ended “functional equivalent” test. It asked the department to revisit its initial compliance cost estimates. It also called for effective dates to line up with related regulations required under the GENIUS Act.
How the GENIUS Act got here
The Guiding and Establishing National Innovation for U.S. Stablecoins Act was signed into law on July 18, 2025. It creates a federal framework for companies that issue payment stablecoins, the dollar-pegged tokens used to move money on blockchains.
The law requires federal or qualifying state oversight for anyone issuing payment stablecoins in the US. It is set to take effect by January 18, 2027, or 120 days after final rules are enacted.
The Federal Reserve and other regulators have released their own proposals to implement different parts of the act. Treasury’s proposal drew more than 100 submissions during the comment period.
Disclosure: This article was edited by John Chen. For more information on how we create and review content, see our Editorial Policy.