U.S. Treasury Proposes Anti-Money Laundering Rules for Stablecoin Issuers

Key Facts

The U.S. Department of the Treasury announced on April 8, 2026, that its Financial Crimes Enforcement Network and Office of Foreign Assets Control had jointly issued a proposal to implement the anti-money laundering and sanctions provisions of the GENIUS Act. The proposal targets permitted stablecoin issuers, treating them as financial institutions for purposes of the Bank Secrecy Act, according to a department statement. It would therefore impose compliance obligations on issuers within the existing legal framework, rather than set out only general licensing rules. Treasury Secretary Scott Bessent said the proposal "will protect the U.S. financial system from national security threats without hindering the ability of American companies to move forward." The move is part of the implementation of the GENIUS Act, which addresses stablecoin issuance and the activities of entities that offer or deal in them.

The proposed rules require issuers to establish risk-based policies, procedures and internal controls to identify, assess and document money laundering, terrorist financing and illicit financial activity risks. They also require ongoing customer due diligence to understand the nature and purpose of the relationship, as well as the creation of a customer risk profile, according to the proposal documents published in the Federal Register. These requirements are part of broader obligations to retain records and monitor and report suspicious transactions. The document also requires issuers to have the technical capability to block, freeze or reject specific transactions. Together, these elements form an operational framework for compliance programs, spanning risk assessment through the handling of transactions that raise suspicions.

This proposal is separate from other rules Treasury issued concerning foreign stablecoins: the August proposal focused on Section 3 of the GENIUS Act and rules for issuance, offering and sale in the United States. In that context, Treasury said a digital asset service provider may not rely on a foreign issuer's certification until it has conducted reasonable due diligence on the issuer. That review includes confirming that no prohibition on secondary trading applies under Section 8 of the act, according to the document. A separate proposal for a customer identification program would require a permitted issuer to prepare a written program suited to the scale of its activity, including risk-based procedures to verify each customer's identity. These requirements differ in scope from the anti-money laundering and sanctions obligations in the joint proposal.

Treasury documents specify penalties for violating the prohibition on issuing a stablecoin of a fine of up to 1 million dollars for each violation, imprisonment for up to five years, or both. The GENIUS Act is expected to take effect on January 18, 2027, according to the department. Issuance in the United States generally requires a federal license or an appropriate state license. General restrictions on offering or selling stablecoins to U.S. residents begin on July 18, 2028, unless they are issued by a licensed entity. For the Section 3 proposal, Treasury requested comments within 60 days of its publication in the Federal Register.