#United States #New York #USDT #GENIUS Act #SSA

SSA Petitions Regulators for Stablecoin Oversight

On December 8, 2025, the Stablecoin Standards Authority (SSA) took a significant step by submitting a petition for regulatory action to various prominent U.S. financial authorities, including the U.S. Department of the Treasury, Federal Reserve, Office of the Comptroller of the Currency, Federal Deposit Insurance Corporation, and the National Credit Union Administration. This petition seeks coordinated regulatory actions to address critical issues relating to the implementation of the recently passed GENIUS Act and enhance oversight of the stablecoin market.

The Need for Unified Stablecoin Regulation

As digital currencies continue to grow in both usage and complexity, the SSA emphasizes the urgent need for a coherent and credible framework governing U.S. payment stablecoins. The petition cites that a consistent application of regulations is vital for enhancing trust and integrity in the system. By aligning the practices across various issuers, SSA aims to ensure that the governance, reliability, and transparency of dollar-denominated stablecoins are stringently maintained.

The SSA's petition highlights two primary concerns that need immediate attention:

1. An Unregulated Offshore Market for U.S. Dollar-Referenced Stablecoins: The petition identifies the existence of significant offshore dollar-referenced stablecoin arrangements, such as USDT. The SSA argues that allowing private entities to operate quasi-banking services without U.S. regulatory oversight contradicts the objectives of the GENIUS Act and the Bank Secrecy Act (BSA). This situation creates potential vulnerabilities that could undermine the financial stability of the overall market.

2. Identification Lapses in Settlement Layer Nodes: A substantial gap in the implementation framework exists concerning the identification and monitoring of the nodes that facilitate stablecoin transactions. The SSA calls for the establishment of On-chain Node KYC (Know Your Customer) procedures and a federally maintained Node Registry. This would help in regulating settlement infrastructures that have significant connections to the U.S.

Strategic Context of the Petition

The SSA aligns its recommendations with the strategic objectives outlined in the Federal Money Services Business Association's (FedMSB) recent white paper. This document articulates a novel doctrine aimed at promoting financial integrity while exploring how to clear illegal financial black markets, referred to as CIFB (Clearing Illegal Financial Black Markets). By implementing this doctrine, regulators can help facilitate lawful innovation in digital finance, free from the risks associated with unregulated financial systems.

SSA’s petition articulates a strong case for why immediate actions are crucial in ensuring that U.S. dollar-referenced stablecoins adhere to responsible financial practices. With the evolution of financial technologies, particularly in the realm of blockchain and digital currencies, the regulatory framework must adapt to effectively oversee these innovations.

Requested Actions from Regulators

The SSA petition outlines specific actions it expects regulatory bodies to undertake:

• - Affirm the applicability of the GENIUS Act and the BSA to dollar-referenced stablecoin activities with a notable U.S. connection.
• - Reflect these principles in the forthcoming GENIUS implementation rules, including criteria for foreign issuers and disclosures.
• - Conduct a comprehensive review of USDT and related entities, focusing on governance, reserves, and controls.
• - Classify USDT and similar arrangements as high-risk instruments for anti-money laundering (AML) and counter-financing of terrorism (CFT).
• - Maintain an interagency registry for licensed payment stablecoin issuers under the GENIUS framework.
• - Develop On-chain Node KYC regulations for settlement infrastructures with U.S. connections.

Looking Forward

Peter Tang, a member of the SSA Steering Board, emphasized the importance of these actions: “Our petition aims to foster a safe and competitive U.S. stablecoin ecosystem. It’s crucial for the GENIUS implementation to provide clarity for responsible innovation, ensuring that major offshore dollar-referenced stablecoin arrangements face stringent oversight.”

The SSA remains committed to developing standards around compliance, governance, and transparency for U.S. dollar stablecoins. This regulatory action is seen as a step towards promoting interoperability and ensuring sound risk management in the digital currency ecosystem, while also supporting the overarching goal of maintaining market integrity.

For more details on the petition, visit FedMSB.org.