Blockchain Association Pushes Treasury for Clearer GENIUS Act DeFi Rules

The Blockchain Association has told the U.S. Treasury that its rollout of the GENIUS Act stablecoin framework needs clearer rules for DeFi platforms and foreign issuers. The trade body's feedback lands as regulators work to translate the landmark legislation into workable guidance for the dollar-backed token market.

The association, which represents major crypto firms in Washington, argues the current implementation path leaves decentralized finance participants in a regulatory gray zone. It also wants the Treasury to spell out how stablecoin issuers domiciled outside the United States can qualify under the new regime.

The GENIUS Act, signed into law in 2025, established the first federal framework for payment stablecoins. Treasury is now writing the rules that determine who can issue, how reserves get held, and what compliance obligations attach. Those secondary details will shape the market far more than the statute itself.

What does the industry actually want?

Two gaps dominate the association's message. First, DeFi. The legislation was drafted with traditional issuers in mind — companies with a legal address, a compliance officer, a bank relationship. Decentralized protocols rarely fit that mold. The lobby wants Treasury to define when a protocol, its developers, or its DAO falls inside the perimeter.

Second, foreign issuers. Dollar-pegged stablecoins circulate globally, and many of the largest are issued through offshore entities. Without clear eligibility criteria, those issuers face a choice between restructuring onshore or restricting U.S. users.

Why the timing matters

Treasury's implementation window is running alongside similar work at other agencies. Banking regulators are weighing how supervised institutions can engage with stablecoin issuers. The SEC is settling its own questions about secondary-market treatment. Overlapping guidance that conflicts would push compliance costs higher and slow product launches.

The association's submission is part of the standard comment process, but its weight is unusual. Member firms handle a large share of U.S. crypto trading volume and custody. Their reading of the rules tends to become the industry's default reading.

The operational stakes

What does this change for stablecoin issuers right now? In the short term, nothing is binding. But the contours Treasury signals now will determine reserve requirements, audit obligations, and whether DeFi front-ends can integrate regulated tokens without becoming issuers themselves.

For foreign issuers, the question is sharper. A vague foreign-issuer rule could freeze partnerships with U.S. exchanges and payment processors until legal teams get comfortable. A clear one would let existing offshore structures certify into the framework.

The industry's ask is not for lighter rules. It is for legible ones. Firms can budget for a strict standard; they cannot budget for an ambiguous one.

What comes next

Treasury is expected to continue rolling implementation guidance through the compliance deadlines set by the GENIUS Act. Issuers and DeFi protocols will be watching the next tranche of rules to see whether the association's two central concerns — decentralized platforms and offshore issuers — get direct answers, or another round of definitional homework.