DCUC Provides Comments to Treasury, Clarifying Credit Union Protections Under GENIUS Act

By DCUC Staff — October 21, 2026

WASHINGTON, D.C. — The Defense Credit Union Council (DCUC) provided comments to the U.S. Treasury regarding its proposed rulemaking to implement Section 3 of the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, which includes the statutory prohibitions and limitations on payment stablecoin issuance, offer, and sale in the United States.

DCUC supports a regulatory framework that enforces the protections of the GENIUS Act while enabling credit unions to manage compliance risk, understand the requirements, and provide quality services to their members. DCUC commended the Treasury for its efforts to create transparent, enforceable boundaries for issuing and distributing payment stablecoins. In its comments, DCUC encouraged Treasury to ensure a final rule clearly distinguishes between activities that involve issuing or distributing a payment stablecoin and activities that merely support a payment, custody, or other financial service. DCUC also recommended that regulators should apply requirements based on the substance of the activity, not solely on participation in a transaction involving a digital asset. ”We support definitions that establish boundaries around incidental services and intermediaries so that credit unions are aware of what would require additional compliance measures and do not interpret the regulatory provisions more broadly than the statute requires. The final rule should clarify that providing ordinary banking, payment, custody, or technology services does not alone make a credit union an issuer or establish that it has offered, sold, or made a payment stablecoin available in violation of Section 3.” DCUC also voiced support for reasonable standards for determining whether a payment stablecoin is offered or sold to a person located in the United States. In response to Treasury’s request for comments on safe harbors in the regulatory requirements, DCUC called for a safe harbor for credit unions that establish reasonable, documented compliance controls, and clarification that a credit union maintaining appropriate controls is not in violation of the requirements solely because of an isolated, good-faith error that is promptly corrected, absent knowing participation in unlawful conduct or a failure to respond to identified risks. “We encourage Treasury to further define what constitutes ‘reasonable due diligence’ when a digital asset service provider relies on a foreign payment stablecoin issuer's representations regarding its ability and willingness to comply with lawful orders or reciprocal arrangements. This definition should indicate that standards are proportional to the institution's role, the nature of the arrangement, and the information available. The final rule should also identify the types of information and documentation necessary to satisfy this standard.” Following Treasury’s request for comments on whether a digital asset redeemable in credit union shares should be treated as a payment stablecoin under Section 3 of the GENIUS Act, DCUC responded in support of a clear distinction between a payment stablecoin and traditional credit union products. DCUC encouraged Treasury to distinguish between a digital asset that independently satisfies the statutory definition of a payment stablecoin and one whose redemption obligation is tied to a different form of financial value. “The fact that credit union shares may be converted into deposits or other monetary value should not alone determine whether a digital asset redeemable in those shares is a payment stablecoin.” Treasury is also proposing to include in Appendix A interpretations to further clarify and illustrate the application of various aspects of the proposed rule. DCUC supports the inclusion of the interpretations and believes they will be helpful for credit unions. “We support additional interpretations to be published in the appendix of this section, including examples involving a credit union that provides account access, processes a payment, uses a third-party vendor, or offers custody without itself issuing or selling the stablecoin.” DCUC encouraged Treasury to coordinate with the National Credit Union Administration (NCUA) and other federal regulators to promote the consistent application of GENIUS Act requirements across the financial sector. DCUC asked that Treasury allow sufficient implementation time after publication of the final rule, as credit unions will need to collaborate with vendors, review policies and procedures, and manage internal controls. DCUC appreciates Treasury's efforts to implement the GENIUS Act and create a framework that supports payment stablecoins and will continue to engage with Treasury as requirements are finalized.

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Originally reported by DCUC.