U.S. agencies seek stablecoin customer-ID rules akin to banks in new GENIUS Act rule

Federal Reserve and other financial agencies have issued their proposed rule for stablecoin customer identification. (Jesse Hamilton/Coin Desk)Summary Show Several U.S. agencies — including the Federal Reserve, Treasury, OCC and FDIC — are pushing the latest major GENIUS Act implementation effort to secure its approach to identifying stablecoin users.The GENIUS Act had mandated that stablecoin issuers be generally treated like more traditional firms, having to meet Bank Secrecy Act and customer-ID standards.The U.S. Federal Reserve, Treasury Department and other financial regulators are pushing a new stablecoin rule that treats issuers like other regulated financial firms when it comes to identifying their users, releasing their draft of the proposed rule on Thursday.

This effort marks the latest step in implementing last year's Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act — the first major crypto law that puts a key aspect of the industry on the map of U.S. financial regulation. Like more traditional financial firms, such as banks and brokerages, U.S. stablecoin issuers must meet the demands of the Bank Secrecy Act and maintain a system of verification for customers' identities, which is meant to combat money laundering, illicit finance and terrorism funding.

These standards, according to the rule proposal, "must include reasonable procedures for: (1) verifying the identity of any person seeking to open an account to the extent reasonable and practicable; (2) maintaining records of the information used to verify a person’s identity, including name, address, and other identifying information; and (3) determining whether the person appears on any lists of known or suspected terrorists or terrorist organizations provided to the financial institution by any government agency."