The GENIUS Act implementation has gained fresh momentum after the U.S. Treasury Department moved to draft guidelines identifying which parties may issue payment stablecoins in the United States.

The effort comes as federal authorities work to establish the rules needed to put the new framework into effect. Banking and financial regulators have also been developing related guidance as the industry waits for clarity, since the details will help define how payment stablecoins fit within existing U.S. financial oversight.

Treasury Secretary Scott Bessent said the government is working to give firms the assurance they need to succeed in the U.S. He also stressed the importance of strengthening the U.S. dollar’s role as the world’s reserve currency and as the center of crypto activity.

Also Read | Strategy Raises $333.7 Million but Keeps Bitcoin Holdings Unchanged

GENIUS Act rules enter public comment period

Treasury’s proposal addresses how the GENIUS Act should apply to stablecoin issuers, including those operating outside the U.S. In preparing the guidance, Treasury considered securities laws but concluded that payment stablecoins require different treatment because they are designed for payments and settlement.

The department warned that applying traditional investment laws could interfere with the use of payment stablecoins for payments.

The proposal follows an announcement from Treasury made in September last year. The public and the stablecoin industry now have 60 days to respond, a period that is expected to end in mid-October.

Treasury has also raised a number of questions about how certain sections of the act should be interpreted, underscoring that the rulemaking is still at an early stage and that the final version could change after feedback is reviewed.

Foreign issuers face close attention

Another major issue is whether the GENIUS Act will apply to foreign stablecoin providers. Large companies operating abroad, including Tether, are expected to closely watch the proposals and assess how they could affect efforts to enter the U.S. market.

Timing is also critical. Under the law, the regulatory framework was supposed to be developed within a year, but that deadline has already passed before all necessary regulations were completed.

The next key deadline is the estimated effective date of January 18. Reaching that target may be difficult, however, because agencies still need to review public comments and finalize the rules. For market participants, that means the practical rollout of the law still depends on how quickly Treasury and other regulators can turn the proposal into final guidance.

GENIUS Act overlaps with broader crypto legislation

The GENIUS Act rulemaking is unfolding alongside congressional debate over the Digital Asset Market Clarity Act. That bill could affect parts of the stablecoin framework, especially provisions tied to incentives for using stablecoins on cryptocurrency exchanges.

The Clarity Act’s prospects are now uncertain after the Senate did not begin certain votes before the recess period started.

For stablecoin firms, Treasury’s proposal marks a significant step toward federal regulation, though additional changes to the framework remain possible as lawmakers and regulators continue to shape the wider U.S. crypto policy landscape.

Also Read | Alibaba Gaming Sale Nears $1.5 Billion as Company Shifts Focus to AI

Primary source

• U.S. Treasury press release
• Regulations.gov docket