NCA Proposes Recommendations to the U.S. Treasury for the Transition to Stablecoins

The National Cryptocurrency Association (NCA) requested a clear framework for the stablecoin market in its letter to the U.S. Treasury regarding Section 3 of the GENIUS Act. It called for the definition of protective mechanisms during the transition process to prevent individual investors from being harmed. The NCA accepted the requirement of 100% reserves for payment stablecoins and argued that user funds should not be automatically locked in cases of sudden changes in the legal status of issuers. Additionally, it proposed a safe harbor mechanism allowing users to liquidate their assets without loss in the event of missing the deadline of July 18, 2028. The NCA demanded clarification of legal mechanisms for the return of stolen or misdirected assets and emphasized that the reissuance of stolen stablecoins should be considered legal. It sought to draw clear boundaries between custodial service providers and software developers. The NCA advocated for transactions within personal wallets and P2P transfers to be exempt from regulatory restrictions. This application brought the discussions between the crypto sector and regulatory bodies in the U.S. to a concrete level.