U.S. Treasury Launches 60-Day Comment Period for GENIUS Act Implementation

The U.S. Department of the Treasury has initiated a 60-day public comment period to support the implementation of the GENIUS Act, a new legislative framework designed to regulate the stablecoin market and reinforce U.S. leadership in digital finance. As outlined in the Federal Register, the public is invited to submit feedback by October 17, 2025, with a focus on innovative strategies for detecting illicit activity, including the application of artificial intelligence, blockchain analytics, and digital identity verification tools [1].

The GENIUS Act, signed into law by President Donald Trump on July 18, 2025, mandates that stablecoin issuers hold 1:1 reserves backed by U.S. Dollars and Treasury securities. It establishes a dual federal-state regulatory structure, restricting stablecoin issuance to designated permitted payment stablecoin issuers (PPSIs) after a transition period that is expected to conclude by November 2026 [3]. This regulatory approach is intended to bolster dollar liquidity while ensuring the stability and transparency of the stablecoin market.

Treasury Secretary Scott Bessent emphasized the strategic importance of the GENIUS Act, describing it as a “win-win-win” for stablecoin users, issuers, and the Treasury Department. The legislation, he noted, supports responsible innovation, strengthens financial infrastructure, and positions the U.S. as a global leader in digital finance [3]. It also aligns with broader government efforts to combat financial crime, requiring financial institutions to implement strategies for detecting and preventing illicit activity related to digital assets [4].

The implementation of the GENIUS Act is expected to lead to increased demand for U.S. Treasuries, as stablecoin issuers adjust their reserve management practices to comply with the new requirements. Major stablecoins such as USDC and USDT may see changes in their liquidity structures as they adapt to the regulatory environment [3]. Financial markets are already anticipating these shifts, with analysts suggesting that the bill could reshape market dynamics as regulations tighten and new policies take effect [5].

The legislation also draws comparisons to the EU’s Markets in Crypto-Assets (MiCA) regulation, which introduced similar reserve requirements for eurozone stablecoins. The U.S. approach, however, reflects a distinct regulatory philosophy that emphasizes collaboration between federal and state authorities [6]. Historical patterns indicate that market participants often transition toward compliance with new regulatory frameworks, and the current public comment period aims to gather insights that will help shape the final regulatory structure [6].

Industry stakeholders have responded positively to the passage of the GENIUS Act. Leaders in the blockchain sector have praised the legislation for promoting responsible innovation and establishing a secure regulatory environment. The public comment process represents the Treasury’s commitment to balancing innovation with oversight, ensuring that the U.S. remains competitive in the evolving digital asset landscape [5].

The feedback period is a critical step in shaping the regulatory environment for stablecoin issuance and anti-money laundering compliance. By incorporating diverse perspectives, the Treasury aims to foster a regulatory framework that supports innovation while protecting the integrity of the financial system. The outcome of this process will likely influence the trajectory of stablecoin development in the U.S. and beyond.

Sources:

[1] https://coinmarketcap.com/community/articles/68a391ee90a7f065068a5d10/