The US Treasury Department has issued a joint proposed rule through its Financial Crimes Enforcement Network and Office of Foreign Assets Control that would impose anti-money laundering and sanctions compliance obligations on payment stablecoin issuers. The notice, released on a Wednesday, forms part of the broader implementation of the GENIUS Act, which was signed into law in July 2025. The proposal marks a significant step toward integrating stablecoin issuers into the existing federal financial regulatory framework.
Under the proposed rule, payment stablecoin issuers would be required to establish and maintain programs targeting anti-money laundering and the countering of terrorism financing. Issuers would also need to operate a sanctions compliance program and retain the ability to block, freeze, and reject certain transactions. For the purposes of the Bank Secrecy Act, these issuers would be classified as financial institutions.
Snir Levi, chief executive of blockchain intelligence firm Nominis, said the move effectively turns stablecoin issuers into bank-like gatekeepers. He noted that full compliance with BSA and OFAC requirements would likely result in significantly more wallet freezes, transaction blocking, and asset seizures at scale. His comments reflect broader industry concern about the operational implications of the new compliance burden.
The GENIUS Act, signed by President Donald Trump, provides a regulatory framework for stablecoin issuers and is widely expected to benefit crypto markets. The legislation is set to take effect either 18 months after its July signing or 120 days after federal authorities issue related regulations, whichever comes first. Separately, the Federal Deposit Insurance Corporation issued its own proposed rule on Tuesday as part of its GENIUS Act implementation, clarifying that stablecoin holders would not receive deposit insurance, though reserve deposits held by issuers would be protected.
While federal agencies advance their implementation work, Congress has made limited progress on a companion bill designed to establish a broader digital asset market structure. The CLARITY Act, which passed the House of Representatives, has yet to be scheduled for a markup by the Senate Banking Committee, a procedural step required before a full floor vote can take place. The delay has prompted representatives from the crypto and banking sectors to engage directly with White House officials on related issues including stablecoin yield, tokenized equities, and ethics concerns.
The White House’s Council of Economic Advisers weighed in on Wednesday, arguing that a proposed ban on stablecoin yield included in the CLARITY Act would do little to protect bank lending while imposing costs on users. As of Wednesday, the Senate Banking Committee had not rescheduled a markup session for the bill. The stalled legislative process leaves key questions about the digital asset market framework unresolved even as agency-level rulemaking moves forward.
Originally reported by CoinTelegraph.
