Overview
- The Blockchain Association filed a 15-page comment by the Aug. 21 deadline that asked five federal agencies to confine customer identification rules to direct issuer-customer relationships.
- The jointly proposed rule from FinCEN, the OCC, the Federal Reserve, the FDIC and the NCUA would make permitted payment stablecoin issuers collect names, dates of birth or formation, addresses and ID numbers and keep those records for five years.
- The association supports identity checks for primary-market actions such as issuance, redemption and custody but argued they should not apply to peer-to-peer or secondary-market transfers that issuers cannot practically identify, a point underscored by the agencies’ estimate that roughly 99% of stablecoin volume occurs in secondary markets.
- The group urged regulators to allow privacy-preserving digital identity tools, specifically zero-knowledge proofs, and warned that a five-year retention rule raises serious privacy risks and incentives to avoid central storage of personal data.
- Regulators will now review public comments and may change key definitions and reliance rules before issuing a final rule that issuers would have 12 months to follow, and the GENIUS Act’s limits on unlicensed stablecoin issuance take effect on Jan. 18, 2027.