The Blockchain Association has filed comments with five U.S. agencies about proposed customer identification rules for stablecoin issuers. The group wants the rules to apply only to direct issuer relationships. It says independent peer-to-peer transfers should not be covered.
The comments were due Aug. 21. The association summarized its position Aug. 24. It supports the overall approach in the proposal but asks for clearer definitions and less duplicated work.
What the proposal requires
In June, FinCEN, the Office of the Comptroller of the Currency, the Federal Reserve, the FDIC and the National Credit Union Administration jointly proposed a customer identification program for permitted payment stablecoin issuers. The rule would require issuers to build a written, risk-based program as part of anti-money laundering controls.
Before opening an account, an issuer would collect a customer’s name, address, date of birth or formation, and an identification number. Then it would use documentary or non-documentary methods to verify the customer’s identity. Records would remain on file for five years after the account closes. Verification records would stay available for five years after they are created.
These requirements follow the $GENIUS Act, which treats permitted stablecoin issuers as financial institutions under the Bank Secrecy Act.
P2P boundary remains a key issue
Blockchain Association agrees that customer checks should apply when an issuer maintains a direct customer relationship. That includes issuing, redeeming, converting, repurchasing or providing custody for a payment stablecoin. But it argues that transactions between users should remain out of scope when the issuer does not intermediate, facilitate or approve them.
The proposal largely adopts that view. It says simply owning or controlling a stablecoin does not create an account. Transfers that touch the issuer only through its smart contract would generally count as secondary-market activity. Examples include transfers from self-hosted wallets, purchases from intermediaries, exchange trades and direct vendor payments.
Regulators estimated that about 99% of stablecoin activity happens in secondary markets. They acknowledged that issuers often cannot obtain identity information for people who never interact with them directly.
Digital identity and duplicate compliance
The association also wants flexibility in how issuers collect and verify information. It supports digital identity tools and interoperable verification technology. The proposal already allows documentary and non-documentary checks. It also asks whether digital identities or verifiable credentials should be included in the final text.
On duplication, the group wants protection for issuers that already work with banks, exchanges and other regulated institutions. The proposed rule would let an issuer rely on work done by another federally regulated institution if that reliance is reasonable, under contract, and certified annually. The issuer remains responsible for compliance. Blockchain Association wants more clarity on how this works across affiliates, intermediaries and state-regulated entities.
What happens next
The public comment period closed Aug. 21. Regulators will now review submissions and may revise definitions of account, customer and digital asset service provider before issuing a final rule. Issuers would have 12 months after publication to comply. No final publication date has been announced.
The broader $GENIUS Act framework is set to restrict unlicensed payment stablecoin issuance in the U.S. starting Jan. 18, 2027. Regulators missed an earlier rulemaking deadline, which shortens the preparation period. The final customer identification rule will need to work alongside other proposals covering licensing, reserves, anti-money laundering programs, sanctions compliance and lawful orders.
