US opens comment period for stablecoin issuer ID checks

US regulators are moving to make stablecoin issuers look more like banks at the point where dollars enter and leave the system. A joint proposal from FinCEN, the Federal Reserve, OCC, FDIC, and NCUA would require permitted payment stablecoin issuers to run a written Customer Identification Program for direct customers.

The rule would apply when users mint, redeem, or hold accounts with an issuer. In those cases, issuers would need risk-based procedures to verify identity and keep records, similar to other anti-money-laundering programs. The Federal Register notice was published on June 22, and comments are due by Aug. 21.

What matters for crypto markets is what the proposal does not do. As drafted, it does not make issuers identify every person who later buys or uses a stablecoin in the secondary market. Exchange trades, wallet transfers, DeFi swaps, and many smart-contract interactions would remain outside a direct issuer KYC event if no formal relationship with the issuer exists.

The agencies said about 99% of stablecoin transaction activity happens in the secondary market. That leaves a split system: tighter controls at issuance and redemption, with the larger debate still open around exchanges, hosted wallets, payment apps, DeFi front ends, and other venues where stablecoins actually circulate.