Key Summary: The U.S. GENIUS Act (PL 119-27, signed July 18, 2025) requires PPSI to establish a Customer Identification Program (CIP), but it does not take effect immediately upon signing. The overall effective date of the act is the earlier of "18 months after signing" or "120 days after the publication of the final implementing rules." As of this writing, the final rules have not yet been published, so the CIP obligation is not yet in effect. On June 22, 2026, five organizations, including FinCEN, released a proposed rule (RIN 1506-AB74) limiting CIP to the "primary market" relationship between issuers and customers; secondary market transactions involving wallets do not trigger identification obligations. The Blockchain Association (BA) submitted a comment letter on August 21, 2026, but requested further tightening of the definitions of "account" and "customer" and avoidance of duplicate compliance. As of this writing, the comment period for the proposed rule has closed, and the final rules and effective arrangements have not yet been published—organizations should not regard proposals or association comments as effective laws or currently enforceable obligations.
Contents
- I. Event and Document Context
- II. What exactly do the laws and proposed rules confirm?
- III. The Blockchain Association's Position (This is merely an opinion and not intended for government adoption)
- IV. Institutional Practice Boundaries and Advance Preparations
- 5. Frequently Asked Questions
- VI. Source
I. Event and Document Context
The GENIUS Act, signed into law on July 18, 2025, is the first federal framework in the United States for payments of stablecoins. It requires PPSI to maintain an effective customer identification program and be treated as a financial institution under the BSA. However, the Act sets an effective date: it must take effect either 18 months after signing or 120 days after the final implementing rules are issued, whichever is earlier. The jointly proposed rules for implementing the authorization were issued by FinCEN, OCC, the Federal Reserve, FDIC, and NCUA on June 22, 2026 (91 FR 37234, RIN 1506-AB74), with a comment period ending on August 21, 2026.
The bill has been signed into law but has not yet come into effect; the supporting rules are still in the drafting stage, and neither of them are currently obligations that have been implemented.
II. What exactly do the laws and proposed rules confirm?
The legal text (12 USC 5903(a)(5)(A)(v)) stipulates that PPSIs must establish an "effective customer identification program, including identifying and verifying the identity of account holders"—but this will only become an enforceable obligation after the bill takes effect. The proposed rule anchors CIPs to "formal relationships," namely primary market activities such as issuance, redemption, exchange, and custody; secondary market activities that only interact with issuer smart contracts are excluded from the "account" scope and not extended.
Uncertain: Neither the proposed rules nor the CIP obligations in the bill have taken effect; the final definitions of "account" and "customer" may still be adjusted and should not be written as existing rules or current requirements.
III. The Blockchain Association's Position (This is merely an opinion and not intended for government adoption)
The BA's comment letter supports the core design of the proposed rules and recommends: 1. Excluding "accounts" from one-off redemptions, supplier relationships, non-stablecoin businesses, and redemptions handled by third parties subject to regulatory oversight; 2. Avoiding duplication with existing BSA requirements; 3. Allowing flexible verification through digital identity tools and other means, and reliance on third parties to complete identification under reasonable safeguards.
BA's argument is based on the original text of the law—the obligation applies only to "issuer account holders," not to anyone who subsequently holds or transfers the tokens; it must be clarified that this is an industry opinion, which has not yet been adopted by institutions, and neither the bill nor the proposed rule has come into effect, so BA argues that it does not constitute a current obligation.
IV. Institutional Practice Boundaries and Advance Preparations
Boundaries of Responsibility (to be implemented): If the final rule maintains the established stance and the bill takes effect, CIP obligations will fall on the "formal relationship" between the issuer and the customer; secondary market transfers, payments via self-custodied wallets, and exchanges generally do not constitute an account relationship. However, this is not a reliable compliance conclusion at present.
Materials and records that can be prepared in advance: To prepare for future implementation, organizations can streamline their account opening process in advance, plan to collect customer names, addresses, dates of birth or incorporation, and identification numbers, and document these in a way that establishes reasonable belief that customer identities have been identified. They should also plan to retain records in accordance with BSA practices (approximately five years each for account closure and verification records). This is for forward-looking preparation only and is not an obligation at present.
Red line: Do not misinterpret "transfers solely through smart contracts" as requiring KYC; nor conversely, do not assume the secondary market has no obligations whatsoever—final rules may change, and exchanges and custodians are themselves bound by the independent BSA. Before the legislation takes effect and final rules are implemented, no coercive actions may be taken against clients on the grounds of "being required to implement CIP."
Next steps for verification: 1. Search for RIN 1506-AB74 final rule and its effective date on Federal Register / Regulations.gov; 2. Verify whether the definitions of "account" and "customer" have been tightened or expanded; 3. Track which of the bill and the final rule took effect earlier.
5. Frequently Asked Questions
Q1: Is KYC now required for stablecoin secondary market transfers?
The proposed rule excludes such activities from PPSI's CIP, but neither the rule nor the bill's CIP has taken effect yet, and the final interpretation is pending. This draft cannot confirm whether it is "must now" or "not necessary at all"; the final rule, the bill's effective date, and the publisher's obligations will prevail.
Q2: Does the opinion of the Blockchain Association mean that the government has adopted it?
This does not represent the views of the BA. The five agencies have only submitted comments; neither the bill nor the proposed rules have been released or indicated adoption. Media reports can only serve as clues and cannot replace official documents.
Q3: Should publishers implement CIP immediately?
This does not confirm that the bill is currently in effect. While the GENIUS Act contains provisions requiring PPSI to establish CIPs, its overall effective date is the earlier of "18 months after signing" or "120 days after the publication of the final implementing rules." As of this writing, the final rules have not been published, and the CIP obligation has not yet reached its effective date; therefore, publishers currently have no legal obligation to implement CIPs. Do not treat proposed texts or bills that have not yet come into effect as current obligations.
VI. Source
- Original opinion letter from the Blockchain Association (August 21, 2026, official original):BA Comment Letter (PDF)
- The Federal Register proposed rule "Permitted Payment Stablecoin Issuer Customer Identification Program" (RIN 1506-AB74, 91 FR 37234, 2026-06-22):Federal Register 2026-12460
- Text of the GENIUS Act (S.1582, PL 119-27):Congress.gov S.1582
This article was originally written by the Aiying Compliance Team and requires authorization to be reproduced.