Blockchain technology provider ConsenSys has recently submitted a detailed formal comment to the Federal Deposit Insurance Corporation (FDIC) regarding its proposed rulemaking to implement the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act). This submission addresses requirements for FDIC-supervised permitted payment stablecoin issuers (PPSIs).
The comment completes several other coordinated filings from blockchain and digital assets firm ConsenSys. It follows their earlier input to the Office of the Comptroller of the Currency (OCC) on May 1 and pairs with a separate letter to the Treasury Department concerning frameworks for evaluating state-level regulatory regimes.
Taken collectively, these particular documents outline a unified vision for the federal oversight of payment stablecoins, which is expected to shape the industry for years to come.
Blockchain focused ConsenSys highlighted four key areas where the FDIC’s proposal requires adjustments to better align with the GENIUS Act’s intent and support responsible innovation.
A key concern involves the proposed rebuttable presumption that applies the GENIUS Act’s ban on issuers paying yield directly to holders, extending it to “related third parties.” Section 4(a)(11) of the Act clearly prohibits stablecoin issuers from offering yields themselves.
However, it does not restrict independent distributors or partners from providing their own commercial benefits or incentives.
ConsenSys argues that the FDIC‘s approach overreaches by encompassing standard business practices, such as brand licensing agreements. Lawmakers had considered—and ultimately rejected—broader restrictions on third parties during the legislative process.
To address this, ConsenSys recommends a clear, four-part test based on common law agency principles.
This would help distinguish legitimate commercial arrangements from attempts to circumvent the yield prohibition. Another critical point focuses on non-custodial software and decentralized finance (DeFi) integration.
The GENIUS Act explicitly safeguards self-custodial tools, and established guidance from FinCEN, US courts, and global regulators affirms that non-custodial wallets function as unregulated interfaces rather than intermediaries.
ConsenSys stresses that users independently interacting with DeFi protocols to earn native yields should not trigger yield-related violations for the wallet provider or the stablecoin issuer.
Clear confirmation in the final rule would prevent unnecessary regulatory burdens on innovative, user-controlled technologies.
The company also acknowledges certain flexible elements in the FDIC proposal compared to the OCC‘s version.
These include allowing multi-brand stablecoin issuance and granting supervisors discretion in handling shortfalls in reserves, redemptions, or capital.
Mandatory penalties, by contrast, could create abrupt disruptions harmful to users. Discretionary oversight enables more balanced, context-aware resolutions that prioritize stability and holder protection.
Finally, ConsenSys calls for more technology-neutral definitions of terms like “distributed ledger” and “smart contract.” Rules should focus on the legal rights and claims of holders rather than specific technical implementations, particularly for cross-chain stablecoin representations.
This approach would future-proof regulations and accommodate evolving blockchain infrastructures without actually favoring or showing strong preference for particular platforms.
As federal agencies finalize these rules, ConsenSys generally views its comments as the beginning of an ongoing dialogue (that will hopefully be constructive). With broader legislative developments in crypto regulation underway, precise implementation of the GENIUS Act will be vital for enabling a more resilient US stablecoin market that benefits consumers, businesses.