Consensys, a leading blockchain software company, has submitted its views on the proposed rules for stablecoins under the GENIUS Act. In a letter to the US Treasury Department, Consensys expressed concerns about certain provisions that could pose risks to stablecoin issuers and decentralized finance (DeFi) platforms.
The proposed rules aim to regulate the payment of stablecoins, but Consensys argued that some provisions go beyond what Congress intended. The company cited the interpretation of yield constraints as a major issue, stating that the current draft extends its scope beyond lawmakers' intentions. Consensys also pointed out that the definition of 'related third parties' could be too broad and attract distributors who offer access or branding services.
The intersection of the rules with DeFi is another area of concern for Consensys. The company noted that decentralized lending markets provide returns to users, rather than issuers, and argued that this should be taken into account when regulating stablecoins. Additionally, Consensys suggested that transparency would be more effective in addressing branding and distribution issues.
Meanwhile, the CLARITY Act continues to face delays due to disagreements over crypto regulations. While the GENIUS Act addresses the payment of stablecoins, the CLARITY Act focuses on overall crypto regulations. However, it is unclear when the Senate will proceed with a markup on the bill, as some members have not yet extended their support for the proposal.