US Treasury Proposes New AML and Sanctions Rules for Stablecoins under GENIUS Act

Treasury and OFAC Target Stablecoins Under GENIUS Act

The U.S. Department of the Treasury’s Financial Crimes Enforcement Network and the Office of Foreign Assets Control issued a joint proposed rule. The mandate implements anti-money laundering and sanctions compliance requirements under the Guiding and Establishing National Innovation for U.S. Stablecoins Act, commonly known as the GENIUS Act. According to official Treasury Department disclosures, the framework establishes core definitions and regulatory jurisdictions for payment stablecoins, positioning permitted payment stablecoin issuers as financial institutions under the Bank Secrecy Act.

Congress passed the underlying framework last year, setting the stage for executive agencies to formulate specific compliance mandates. Treasury Secretary Scott Bessent emphasized that the executive branch is actively working to cement American leadership in digital financial technology.

“This proposal will protect the U.S. financial system from national security threats without hindering American companies’ ability to forge ahead in the payment stablecoin ecosystem,” Bessent stated in a release published on home.treasury.gov.

Bank Secrecy Act Integration for Issuers

Under the newly proposed federal oversight regime, permitted payment stablecoin issuers face structural integration into traditional financial policing mechanisms. Per documents released via fincen.gov, the statute formally directs the Treasury to treat these issuers as financial institutions for the purposes of the Bank Secrecy Act. This designation requires firms to implement robust anti-money laundering controls tailored specifically to digital asset networks.

Mandatory Compliance Pillars for Market Participants

The regulatory text outlines two distinct compliance pillars required for market participation:

• Anti-money laundering operational frameworks designed to assist federal law enforcement while minimizing operational friction.
• Mandatory sanctions compliance programs supervised directly by the Office of Foreign Assets Control to block illicit actors.

National Security Guardrails and Liquidity Shifts

According to the joint administrative filing, the proposed obligations are calibrated to be fit for purpose. FinCEN officials note that modernizing these requirements serves to shield the domestic banking architecture from illicit finance risks while maintaining commercial agility.

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