Stablecoin Project: EU vs US Regulatory Differences

Under what circumstances should foreign stablecoin companies be able to access the US market? Treasury is about to set the rules of the road and has given the market a month to weigh in. For firms the GENIUS Act defines as Foreign Payment Stablecoin Issuers (or “FPSIs” if you’re into the whole brevity thing) this will determine the ability to access the world's largest market. For everyone else, this is the chance to make sure the playing field is level. Either way, the time to act is now. Now, we already know that the GENIUS Act restricted FPSIs from operating in the US after July 2028 unless the Treasury Secretary determines that the country in which an FPSI operates has a comparable regulatory and supervisory regime to the US. In its September 19 advanced notice of proposed rulemaking (ANPR) regarding implementation of the GENIUS Act, Treasury requested the public’s comments on a series of questions critical to the future of FPSI operation in the US (see Section V at pages 12-14, questions 29-36, linked in comments below). Questions like: • Are there specific foreign stablecoin regulatory regimes that may already meet this comparability standard (or others that materially differ from GENIUS regime)? • What type of differences could create “market frictions in international digital assets activity”? • What factors should Treasury include/exclude in its comparability analysis? • What technical, legal, or regulatory measures are most relevant for interoperability? There are jurisdictions that could likely meet such a comparability standard today, and more to follow.  This ANPR provides a rare opportunity for FPSIs to meaningfully shape the regulation they’ll need to comply with by touting their home country’s bona fides in this space and identifying the most relevant factors to consider. You have until October 20 to submit your comments.  I’d love to hear what folks here think about where this piece of stablecoin regulation should go, and also where it is likely to go.  If you’d rather discuss privately, feel free to DM me. 

Europe, Swiss Financial Market Supervisory Authority (FINMA): FINMA Issues Guidance on Crypto Asset Disclosure in Financial Statements The Swiss Financial Market Supervisory Authority (FINMA) has issued guidance on the disclosure of cryptobased assets in the annual financial statements of banks and securities firms. This guidance addresses ambiguities that have emerged since the Distributed Ledger Technology (DLT) Act came into effect. FINMA underscores the necessity for continued compliance with existing disclosure obligations while providing clarifications. The DLT legislation has introduced various decrees that adjust the treatment of cryptobased assets, including legal clarifications of terminology and conditions for classifying these assets as custody assets under Article 16 no. 1bis of the Banking Act. The industry has reported several ambiguities regarding the disclosure of cryptobased assets, prompting FINMA to offer clarity. While existing disclosure duties remain unchanged, FINMA allows for pragmatic adaptations in the place of disclosure by banks or securities firms. Additionally, it specifies that amounts for cryptocurrencies held on a fiduciary basis should no longer be reported in the corresponding section of supervisory reporting. Source: https://lnkd.in/eiEnUB7z

Your regulatory and policy insights cheat sheet - August 2025 edition. The global digital assets landscape is hardening into distinct models and the signals are getting clearer. Success metrics are shifting from open competition to picking winners, with alignment to banks, sovereign funds and large incumbents. The era of greenfield licences is fading fast. Policy settings that look noisy on the surface often represent continuity underneath. What matters is not the headline but whether you are inside the right relationships when approvals are handed down. Institutionalisation is now the centre of gravity. Commercial opportunity is moving from crypto-native entrants to traditional financial services and large players regulators trust to manage custody, balance sheets and risk. At the same time regulators are still applying traditional policy tools to a fast-moving market. The outcome is longer queues, proxy regulation and uneven enforcement with firms waiting while opportunities pass elsewhere. Localisation through tax receipts, jobs and institutional partnerships has become the new currency of credibility, but only if you are a market of interest.

FCA consults on standards for UK crypto-asset firms - STEP: The Financial Conduct Authority (FCA) has issued proposals on the minimum standards crypto firms in the UK will need to comply with.

Australian financial markets are witnessing a transformative moment as ASIC announces significant easing of stablecoin regulation for licensed brokerages, potentially accelerating digital asset adoption across the continent's financial sector. #ASIC #Australia #CryptoRegulation #FinancialServices #Stablecoins

The SEC and CFTC released a joint statement outlining efforts to coordinate regulatory frameworks, including: o  24/7 Markets. For on-chain finance to scale, the statement indicated that the SEC and the CFTC should collaborate to consider the possibility of further expanding trading hours, where appropriate. Factors that may be relevant include operational feasibility and liquidity consistent with investor and customer protections. Specific markets, including foreign exchange, gold, and crypto assets, already trade continuously. Further expanding trading hours could better align U.S. markets with the evolving reality of a global, always-on economy. Expanding trading hours may be more viable in some asset classes than others, so a one-size-fits-all approach may not be applicable to all products. o  Event Contracts. The statement noted that prediction markets, which have existed around the world for decades, are undergoing rapid growth due to increasing demand from both market operators and the public. The agencies should work together to provide clarity for innovators who want to list event contracts on prediction markets responsibly, including those based on securities. The SEC and CFTC should explore opportunities to collaborate on considering where event contracts may be made available to U.S. market participants, regardless of where the jurisdictional lines fall. o  Innovation Exemptions and DeFi. Both agencies are prepared to consider “innovation exemptions” to create safe harbors or exemptions that allow market participants to engage in peer-to-peer trading of spot, leveraged, margined, or other transactions in spot crypto assets, including derivatives such as perpetual contracts, over DeFi protocols. These safe harbors and exemptions would allow market participants to build commercially viable models while the agencies advance longer-term rule-making. o  Next Steps. The statement announced a joint SEC-CFTC roundtable scheduled for September 29, which will focus on discussing regulatory harmonization with stakeholders. The statement indicated that the United States has long been the home of financial innovation, but recently, novel products have been driven overseas due to fragmented oversight and legal uncertainty. The SEC and the CFTC should encourage the reversal of this trend by harmonizing their approaches to product offerings, enabling increased market choice, and protecting investors through clear, predictable, and pro-innovation regulatory frameworks. Link here: https://lnkd.in/gSDfaNRT

US–EU Regulatory Cost Curves Have Diverged—Investor Implications Two timelines, two cost curves: US: Oct deadlines create engagement opportunities while delaying spending (CFTC, Treasury, unified banking). EU: Sept 15 precedents and MiCA obligations lock in compliance expenses through 2026. Implications for investors: • Capital-efficient positioning = engage US, anchor predictable EU jurisdictions • Market timing = US delay enables development before costs bite • Hedging = Germany/France/Netherlands → predictability; shape US rules simultaneously For portfolios: Cross-border strategies must differentiate. EU costs are immediate; US frameworks remain shapeable. 👉 Full investor lens in this week’s DigitalRegIntel Brief. https://lnkd.in/gjfQrzY6

Over the past weeks I had several conversations which all boiled down to one question: how can someone compliantly launch tokenized securities in the U.S.? My short answer: You can't. My somewhat longer answer: Well… you could reach users in the U.S. indirectly through DeFi, but it's difficult and risky. My unguarded answer: Right now, U.S. users can buy tokenized securities though distributed exchanges (DEXs) and use them in DeFi lending protocols, but everyone involved is taking a big risk. - DEXs are hoping the SEC won't sue them as unregistered securities exchanges or ATSs. - Market makers on secondary markets are hoping the SEC and FINRA won't sue them as unregistered broker-dealers. - Tokenized securities issuers (who rely on Regulation S for issuing tokens outside the U.S.) are hoping that the SEC won't sue them for making unregistered securities offerings without a valid exemption. The tailwinds for tokenized securities have never been stronger and anyone who wants to get into the tokenized securities business should be building now. Just remember that good vibes don't replace compliance and, despite encouraging government statements, the laws pertaining to tokenized securities haven't changed and won't change for a while to come (months, maybe years). That's why you don't see centralized exchanges offering these products in the U.S. Be careful. Definitely, absolutely, not legal advice.

Treasury’s Strategic Delay = US Capital Efficiency Advantage Treasury issued limited GENIUS guidance Aug 18, with AML comments due Oct 17. Full implementation is likely delayed until late 2026. Why it matters: Treasury is using its statutory runway, creating a two-speed market. • US issuers → Defer costs, influence technical details in Oct • EU issuers → Immediate MiCA costs and audits • Processors → Optimize for US timeline while EU competitors pay early Cross-border arbitrage: The gap between EU MiCA obligations and delayed US implementation gives US issuers temporary advantage. Executive decision: Engage Oct 17 to influence rules but avoid premature spending. 👉 See timing analysis and strategy in this week’s DigitalRegIntel Brief. https://lnkd.in/gjfQrzY6

📢 KPMG just released a landmark report: “The bridge between traditional finance and digital assets.” The focus? Stablecoins and how they are rapidly moving from a crypto niche to becoming part of the global financial backbone. According to the report, July 2025 was a turning point: the GENIUS Act became the first comprehensive US regulation for stablecoins. With this, banks and financial institutions now have regulatory clarity to issue and manage “digital dollars.” 🔑 Highlights from KPMG’s analysis: - Only regulated banks or licensed firms can issue stablecoins. - Every token must be backed 1:1 by USD or highly liquid assets like T-Bills. - Audited reserves and monthly disclosures are mandatory. - Holders gain first priority in case of insolvency. 💡 Opportunities identified: - Cross-border payments: From 2–5 days and high fees to seconds and near-zero cost. - Trading: Real-time settlement (T+0), better liquidity management, and reduced counterparty risk. - Corporate adoption: Stablecoins could be treated like liquid funds on balance sheets, reshaping treasury strategies. ⚠️ Challenges noted: KPMG stresses that trust, governance, AML/KYC, and cybersecurity are critical. Without transparency and risk management, adoption could stall. 👉 Key takeaway from the report: Stablecoins are no longer just a crypto experiment. With regulation, they are positioned to become a mainstream instrument, bridging traditional finance with digital innovation. This report isn’t just theory it’s a roadmap for banks, asset managers, fintechs, and corporates preparing to integrate stablecoins into their strategies.