NPRM: Permitted Payment Stablecoin Issuer AML/CFT program and sanctions compliance program requirements (91 FR 18582) (Part 6 of 8)
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Research, not advice. Part of the Bitcoin research archive (October 2026). Claims labelled unverified, contested or fringe are reported, not endorsed; statuses of bills and rules are as of the date checked. Government, court and patent records are public domain; the research notes are CC BY 4.0.
AML/CFT program be approved and maintenance of a system of risk- PPSIs would be U.S. persons that are
by the PPSI’s board of directors or an based internal controls, as described in likely successors to MSBs or affiliated
equivalent governing body within the section VII.B.3, including technical with insured depository institutions,
PPSI, or appropriate senior capabilities and written policies and which already have AML/CFT program
management. procedures, to identify any activity requirements and generally, in practice
PPSIs that do not already have an prohibited by U.S. sanctions and take have systems to comply with sanctions
AML/CFT program in place would incur appropriate action, including blocking, similar to the ones that would be
costs to establish such a program and rejecting, and reporting certain required to comply with the proposed
have it approved by the PPSI’s board of transactions in compliance with existing rule. Thus, the incremental costs
directors or an equivalent governing OFAC regulations. contemplated here are only those
body within the PPSI, or appropriate In support of maintaining an effective entailed by the need for PPSIs to review
senior management. A PPIS that already sanctions compliance program, OFAC’s the regulation and make any changes or
has a AML/CFT program would need to proposed rule would require the modifications to their AML/CFT or
review and/or modify its program to conduct of holistic risk assessments at sanctions compliance programs. The
ensure it complies with the appropriate intervals, as outlined in modified program would then be
requirements of the rule. In addition, all VII.B.2. These periodic risk assessments approved and appropriate records
PPSIs would incur costs for are essential to a current and effective retained to be produced upon request.
maintaining, updating, storing, and sanctions compliance program, FinCEN and OFAC expect that on
producing upon request the written including in terms of understanding risk average, the incremental burden
AML/CFT program.468 and maintaining up-to-date internal associated with establishing and
With respect to OFAC requirements, controls and training programs. Internal maintaining a written AML/CFT and
PPSIs would need to establish and controls and risk assessments are sanctions compliance program
maintain an effective sanctions already a key element of standard (including the time burden associated
compliance program. The program must sanctions compliance practices common with storing and producing the relevant
be risk based and reasonably designed among regulated actors and thus OFAC program records upon request) would
to ensure compliance with all does not assess this requirement to take approximately 30 hours per PPSI in
applicable U.S. sanctions. Entities that incur incremental economic costs, the first year and ten hours in each
do not have a sanctions compliance despite being a novel explicit subsequent year. However, because
program in place would need to requirement. MSBs and insured depository
establish such a program, and those In practice, FinCEN and OFAC expect institutions already generally update
with a sanctions compliance program that some elements of a PPSI’s AML/ their programs annually, FinCEN and
would need to review and, as necessary CFT program may overlap with its OFAC only account for the first-year
and appropriate, modify their programs sanctions compliance program. For burden as an incremental cost. As
to ensure they comply with the instance, approval of the AML/CFT presented in table 4, FinCEN and OFAC
requirements of the final rule. In line program would also likely include estimate an average incremental cost of
with an organizational commitment to approval of the sanctions compliance $3,737 per PPSI and a total incremental
the compliance program, senior program, and risk assessments could be cost of $186,870 in the first year
management would need to review and conducted enterprise-wide to evaluate associated with this activity.469
TABLE 4—ESTIMATED FIRST-YEAR INCREMENTAL COST TO ESTABLISH AND MAINTAIN A WRITTEN AML/CFT PROGRAM
Number of
Hours per PPSI Cost per PPSI Total cost
PPSIs
30 ................................................................................................................................................. $3,737 50 $186,870
468 This includes both producing the program and Managers; 11–3031: Financial Managers; 13–1041: leave), FinCEN and OFAC apply the private sector
any program certifications upon request. See supra Compliance Officers; 23–1010: Lawyers and benefit factor to the unloaded wage rate to reflect
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sections VI.C.3.iii and iv. Judicial Law Clerks; 43–3099: Financial Clerks, All the total cost to the employer. The benefit factor is
469 Throughout this analysis, FinCEN and OFAC Other) for each of the nine groupings of NAICS the ratio of total compensation (which includes
industry codes that FinCEN and OFAC determined wages and benefits) to wages. Total compensation
apply an hourly wage rate that is a general
are most directly comparable to its 11 categories of
composite hourly wage rate ($87.61) scaled by a = 43.94 and Wages and salaries = 30.90 (1.42 =
potentially affected financial institutions as
private sector benefits factor of 1.42 ($124.58 = delineated in 31 CFR parts 1020 to 1030. See BLS, 43.94 ÷ 30.90) as of June 2024, based on the private
$87.61 × 1.42). This incorporates Bureau of Labor May 2024—National industry-specific and by industry workers series data downloaded from BLS.
Statistics (BLS) mean wage data associated with six ownership, available at https://www.bls.gov/oes/ BLS, Employer Costs for Employee Compensation
occupational codes (11–1010: Chief Executives; 11– tables.htm. Given that many occupations provide data, available at https://www.bls.gov/news.release/
3021: Computer and Information Systems benefits beyond wages (e.g., insurance and paid archives/ecec_09102024.pdf.
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2. Audit and Independent Testing 3. Training Development and stakeholders, appropriately tailored to
FinCEN and OFAC also expect PPSIs Implementation each trainee’s role and responsibilities,
to face costs associated with The proposed rule would require a and based appropriately on the PPSI’s
independent testing of their AML/CFT PPSI to provide ongoing employee risk assessment and risk profile.473
program and sanctions compliance training as part of its AML/CFT program Additionally, OFAC would require that
program and associated systems.470 and to establish and maintain a risk- a PPSI’s compliance training program be
Because such testing often relates based compliance training program as modified to reflect risk assessments
closely to the technology services part of its sanctions compliance findings and identified deficiencies as
financial institutions typically have in program in accordance with the well as designed to include easily
place for these compliance functions, requirements as described in sections accessible resources and materials for
the costs for such testing are considered VI.C.3.ii.d and VII.B.5, respectively. all.
jointly with technology implementation. FinCEN and OFAC outline the expected Although these are separate
In concordance with previous FinCEN economic impacts of these requirements requirements, it is common for financial
analysis on this topic,471 FinCEN and on incremental costs below. institutions to include sanctions in their
OFAC expect the cost of independent With respect to FinCEN requirements, AML/CFT training. FinCEN and OFAC
testing to be comparable to the cost of a PPSI’s AML/CFT program must expect that PPSIs would face limited
technology implementation. However, include an ongoing employee training costs in training development,
because MSBs and banks are already program.472 The training should implementation, and execution for
subject to audit and testing generally cover the PPSI’s internal employees relative to other financial
requirements, these costs are not policies, procedures, and controls, institutions like traditional large banks
included in the estimate of novel which in turn reflect the results of the because stablecoin issuers typically
incremental costs of the proposed rule. PPSI’s risk assessment processes, the operate under a capital-intensive model
To ensure the integrity of PPSIs’ latest AML/CFT regulatory with fewer employees.474 Because
sanctions compliance programs and requirements, and other relevant overall AML/CFT training requirements
internal controls, as outlined in VII.B.4., information. While the proposed rule already exist for MSBs and banks, this
OFAC’s proposed rule would also does not prescribe the frequency with proposed requirement would only
require that PPSIs maintain an which the training should occur, PPSIs impose a small incremental cost
independent testing or audit function to should conduct the training as associated with updating training to
examine the effectiveness of their frequently as they deem necessary based contain sanctions compliance. Table 5
sanctions compliance program, on their unique, individual ML/TF risk provides an estimate of the one-time
including their internal controls. PPSIs profiles and the specific roles and costs associated with establishing and
would also need to utilize the results of responsibilities of the persons receiving maintaining the employee training
such tests and audits to identify and the training. program in the first year. Because
implement any needed changes to its As described in section VII.B.5, annual ongoing costs associated with
sanctions compliance program. In OFAC’s proposed rule would require a training programs already exist for
practice, OFAC expects that PPSIs PPSI to establish and maintain a risk- MSBs and banks, FinCEN and OFAC do
would conduct any AML/CFT and based compliance training program that not assign additional incremental costs
sanctions compliance program testing or is conducted at least annually, provided in subsequent years attributed to the
audits jointly. to all relevant personnel and proposed rule.
TABLE 5—ESTIMATED FIRST-YEAR INCREMENTAL COSTS TO ESTABLISH AND MAINTAIN AN ONGOING EMPLOYEE TRAINING
PROGRAM
Number of
Hours per PPSI Cost per PPSI Total cost
PPSIs
8 ................................................................................................................................................... $997 50 $49,832
4. Customer Due Diligence information, including information to other financial institution types
The proposed rule would require regarding the beneficial owners of a subject to CDD requirements as
PPSIs to conduct ongoing CDD as part legal entity customer. This section proposed in another FinCEN
of their AML/CFT program. Specifically, estimates the cost to PPSIs of CDD rulemaking.475 Using the annual average
PPSIs would be required to (1) activities and the collection of BOI from of 650 new customers per PPSI, as
understand the nature and purpose of legal entity customers. discussed in section XII.A.2.ii.d.2, this
customer relationships for the purpose Because ongoing CDD is a risk-based estimate equates to nearly five minutes
of developing a customer risk profile; activity not inherently tied to the per customer. However, as CDD
and (2) conduct ongoing monitoring to number of customers a PPSI has, activities need not be applied to every
identify and report suspicious FinCEN estimates a fixed annual burden customer if doing so would be
transactions and, on a risk basis, to of 50 hours per PPSI. This estimate inconsistent with an allocation of
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maintain and update customer reflects similar costs expected to accrue resources that prioritizes higher risk,
470 See supra sections VI.C.3.ii.b and VII.B.4. FinCEN, Financial Crimes Enforcement Network: 473 See supra section VII.B.5.
471 In 2024, FinCEN’s analysis of AML/CFT Anti-Money Laundering/Countering the Financing 474 FinCEN and OFAC invite comment on
software implementation and testing, based on a of Terrorism Program and Suspicious Activity whether these are accurate assumptions.
2020 study by the GAO, estimated independent Report Filing Requirements for Registered 475 See the 2026 NPRM, FinCEN, Anti-Money
AML/CFT testing for financial institutions to cost Investment Advisers and Exempt Reporting
Advisers, 89 FR 72230 (Sept. 4, 2024), at table 5.3. Laundering and Countering the Financing of
approximately $17,000, which was 1.37 times more
costly than AML/CFT software implementation. See 472 See supra section VI.C.3.ii.d. Terrorism Programs, at section X.E.2 of that NPRM.
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this merely serves as an illustrative others may not experience any in a incremental cost of this requirement
estimation. In practice, FinCEN expects given year. In addition, because ongoing amounts to an annual per-firm burden
PPSIs might allocate a fixed amount of CDD is already required of banks, this of 50 hours, a total burden of 1,000
effort and resources to the review of proposed requirement is not expected to hours, a per-firm cost of $6,229, and a
customers ranked by identified risk, result in incremental costs for IDI- total cost of $124,580.
meaning that some customers would subsidiary PPSIs. As presented in table
experience significant review, while 6, for 20 non-IDI subsidiary PPSI, the
TABLE 6—ESTIMATED ANNUAL INCREMENTAL COSTS ASSOCIATED WITH ONGOING CDD FOR NON-IDI SUBSIDIARY PPSIS
Number of
Hours per PPSI Cost per PPSI Total cost
PPSIs
50 ................................................................................................................................................. $6,229 20 $124,580
In addition to ongoing CDD, PPSIs from similar and complementary additional BOI collection for new
would be required to collect and verify activities that would be undertaken to customers would require 15 minutes
BOI of new accounts opened by legal satisfy a PPSI’s CIP requirements, which (0.25 hours) on average per customer.
entity customers.476 These would the GENIUS Act directs to be imposed PPSIs are expected to have an average
represent new requirements not on PPSIs. Therefore, some burden of 650 new customers per year,478 and
currently applicable to MSBs and are elements associated with collecting virtually all of these are expected to be
therefore considered by FinCEN to customer information that serves both legal entities. Thus, as presented in
result in incremental costs for non-IDI CIP and CDD purposes would also be table 7, FinCEN conservatively
subsidiary PPSIs. A PPSI may obtain the accounted for in the regulatory analysis estimates that BOI collection would
required identifying information by accompanying such a CIP-specific result in an annual incremental cost of
either obtaining a prescribed proposal. However, the cost of $20,244 per non-IDI subsidiary PPSI,
certification form from the individual beneficial ownership verification, which resulting in a total incremental cost of
opening the account on behalf of the extends beyond the basic customer $404,885 per year. For small PPSIs, the
legal entity customer or by obtaining the information collection requirements that number of expected primary market
required information directly from the would be contained in a PPSI CIP customers is expected to be closer to
individual. PPSIs would be required to NPRM, are estimated below. 100, or 65 new customers annually.
retain records used to identify each FinCEN anticipates a population of Thus, the anticipated cost for small
beneficial owner of a legal entity approximately 20 non-IDI subsidiary PPSIs is expected to be substantially
customer for five years after the date the PPSIs that are not currently subject to less than the average presented here
account is closed. any BOI collection requirement for new (approximately $2,024 per PPSI). As this
Some of the activities a PPSI would customers.477 BOI collection would be section does not apply to OFAC related
undertake to satisfy CDD requirements required only for new primary market requirements, no additional OFAC
are difficult to meaningfully separate customers. FinCEN anticipates the associated costs were considered here.
TABLE 7—ESTIMATED ANNUAL INCREMENTAL COST OF BOI COLLECTION FOR LEGAL ENTITY CUSTOMERS
Hours per Hours per Cost per Number of
Number of new customers Total cost
customer PPSI PPSI PPSIs
650 ....................................................................................... 0.25 162.5 $20,244 20 $404,885
5. Additional Technical Capabilities, order, described in VI.C.5.ii. Although additional requirements with respect to
Policies, and Procedures these are separate obligations, FinCEN technical capabilities, policies, and
The proposed rule would require expects that PPSIs may use the same procedures are not itemized separately
PPSIs to have technical capabilities, technological capability to comply with or incrementally, but are instead
policies, and procedures to block, both. FinCEN also expects that considered to be included in the costs
freeze, and reject specific or stablecoin issuers may already have in associated with the internal policies,
impermissible transactions that violate place technical capabilities and policies procedures, and controls component of
Federal or State laws, rules, or and procedures relating to taking action establishing and maintaining an AML/
regulations, described in VI.C.5.i. The regarding impermissible transactions CFT program and the broader general
requirement would apply to both a and adhering to lawful orders because of technology costs of the proposed rule.
PPSI’s primary market and secondary existing legal requirements, including
6. BSA Reporting
market activity. The proposed rule complying with OFAC sanctions and
would also require PPSIs to have the court orders.479 The proposed rule would require
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technological capability to comply, and For these reasons, the expected PPSIs to file BSA reports, namely CTRs
to comply with the terms of any lawful economic costs of the proposed and SARs.
476 See supra VI.C.5. rule, OFAC would require a PPSI to establish and compliance with existing OFAC regulations. While
477 See supra section XII.A.2.ii.a. maintain risk-based controls, including technical the technological ability to block, freeze, and reject
478 See supra section XII.A.2.ii.d.2. capabilities and written policies and procedures, to specific transactions would be a new requirement,
479 With respect to OFAC requirements, as
identify any activity prohibited by U.S. sanctions OFAC expects that most or all PPSIs would already
and take appropriate action, including blocking, have this capability as a part of standard business
described in section VII.B.3, under the proposed rejecting, and reporting certain transactions in practices.
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CTRs SARs estimate the range of costs associated
As proposed, the rule would require The proposed rule would require with SAR filing, FinCEN contemplated
a PPSI to file CTRs on transactions in PPSIs to file SARs for any suspicious a range of potential filing scenarios,
currency of more than $10,000, unless primary market transaction relevant to a with a low end of 100 and a high end
subject to an applicable exemption, possible violation of law or regulation, of 1,000. FinCEN anticipates that each
described in section VI.C.7 However, described in section VI.C.8. In addition, SAR filing would take approximately 90
FinCEN recognizes that, presently, PPSIs would be required to maintain a minutes (1.5 hours). Based on market
stablecoin issuers rarely engage in copy of any SAR filed and the data, FinCEN estimates a distribution
physical transfers of currency, and supporting documentation for a period where five out of 50 PPSIs would have
anticipate that because this would likely of five years from the date of filing. stylized high reporting obligations in
also be the case for future PPSIs, the Supporting documentation would need connection with more widely used
costs of actually filing CTRs are to be made available to FinCEN and the products with more, and more complex,
expected to be de minimis. In addition, prescribed law enforcement and SAR filings, and 45 out of 50 would
because CTR filing requirements already regulatory authorities, upon request. have stylized low reporting obligations
exist for IDIs and MSBs, FinCEN does Based on an analysis of SAR filings with fewer, less complex SAR filings.481
not consider the costs of the proposed between 2021 and 2025 discussed in Table 8 presents this distribution, which
CTR filing obligation to represent a section XII.A.2.iii.b, FinCEN estimates results in a weighted annual average of
change in requirements. Consequently, that PPSIs would each file an average of 190 filings per PPSI, resulting in an
there is nothing to which a novel 100 SARs per year, although some may annual burden of 285 hours per PPSI.482
incremental cost could attach.480 file significantly more than that. To
TABLE 8—ESTIMATED ANNUAL SAR BURDEN ASSOCIATED WITH FILED REPORTS
Hours per Number of
Number of filings Total hours
filing PPSIs
100 ............................................................................................................................................... 1.5 150 45
1,000 ............................................................................................................................................ 1.5 1,500 5
Based on survey responses reported in referred to as ‘‘cases’’), approximately described above, FinCEN estimates a
a 2018 Bank Policy Institute report, of 42 percent were turned into SARs.483 weighted annual average of 266 unfiled
the suspicious activity alerts that are Therefore, for each case filed as a SAR, cases per PPSI, resulting in an
turned into full case investigations (i.e., approximately 1.4 cases were not filed. additional annual burden of 133 hours
alerts that are not considered false FinCEN estimates that each unfiled case per PPSI.
positives and involve additional would take approximately 30 minutes
documentation, which are hereafter (0.5 hours). Using the distribution
TABLE 9—ESTIMATED ANNUAL SAR BURDEN ASSOCIATED WITH UNFILED CASES
Number of Hours per Number of
Number of gilings Total hours
unfiled cases unfiled case PPSIs
100 ................................................................................................................... 140 0.5 70 45
1,000 ................................................................................................................ 1,400 0.5 700 5
While these time estimates are used to the BSA and under OFAC regulations, for up to five years. PPSIs would also be
provide a sense of the costs associated described in sections VI.C.9 and VII.A, required to comply with the
with SAR reporting for PPSIs, because respectively. FinCEN and OFAC outline Recordkeeping Rule which would
FinCEN assumes that as the relevant the impacts of these requirements on require PPSIs to collect and retain
counterfactual all future PPSIs would incremental costs below. records for funds transfers and
otherwise still have SAR filing With respect to FinCEN requirements, transmittals of funds in amounts of
requirements either as an MSB or PPSIs would be required to create and $3,000 or more, and the Travel Rule
because of bank affiliation, this retain certain records for extension of which would require PPSIs to transmit
proposed requirement is not expected to credit in excess of $10,000; and certain information on certain funds transfers
present a novel incremental cost to records of cross-border transfers of and transmittals of funds to other
PPSIs.484 currency, monetary instruments, funds, financial institutions participating in
checks, investment securities, and credit the transfer or transmittal.
7. Recordkeeping and Technology
worth more than $10,000. PPSIs would In practice, FinCEN expects that
The proposed rule would require be required to maintain records related PPSIs would extend credit infrequently
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PPSIs be subject to recordkeeping under to any order issued under § 1010.370(a) and therefore expect the primary burden
480 There are no OFAC associated costs approximately 88 percent of the total SARs Compliance (Oct. 29, 2018), table 1, p. 6, available
considered here because this section does not apply observed by FinCEN. at https://bpi.com/wp-content/uploads/2018/10/
to OFAC related requirements. 482 FinCEN and OFAC request public comment on
BPI_AML_Sanctions_Study_vF.pdf.
481 Among the products and issuers FinCEN the accuracy and completeness of this estimate. 484 This section does not apply to OFAC related
examined, as discussed in section XII.A.2.iii.b, the 483 See Bank Policy Institute, Getting to
requirements and so OFAC associated costs are not
top five largest potential PPSI issuers (each with Effectiveness—Report on U.S. Financial Institution
considered here.
reserve assets of over $300 million) filed Resources Devoted to BSA/AML & Sanctions
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from these proposed requirements to With respect to OFAC requirements, only to the results of the testing and
stem from compliance with the the proposed rule includes a new auditing of the sanctions compliance
Recordkeeping Rule and the Travel requirement that would require PPSIs to program component. However, OFAC
Rule. Cumulatively, FinCEN estimates maintain records of the results and acknowledges that in practice, many
the annual recordkeeping burden per enhancements from the testing and firms may opt to store the results of
PPSI for these requirements would be auditing components of their sanction their overarching AML/CFT program
approximately 20 hours. However, compliance programs, in addition to test, of which sanctions compliance is
because these requirements already standard recordkeeping requirements an inseparable part. The average annual
exist for banks and MSBs, FinCEN does for U.S. persons pursuant to part 501 of cost of this specific recordkeeping
not contemplate this as an incremental title 31.485 This newly proposed activity, which is distinct from the joint
cost attributable to the proposed rule. recordkeeping requirement would apply costs, is approximated in table 10.
TABLE 10—ESTIMATED INCREMENTAL ANNUAL RECORDKEEPING COST
Number of
Hours per PPSI Cost per PPSI Total cost
PPSIs
2 ................................................................................................................................................... $249 50 $12,458
FinCEN and OFAC also for specialized software, would range subsequent years, FinCEN and OFAC
conservatively estimate a joint from approximately $10,000 to $20,000 estimate they would each incur an
incremental general technology cost per firm in the first year, and about annual cost of $10,000. This includes
associated with AML/CFT and sanctions $5,000 to $10,000 annually thereafter the cost of technology implementation,
compliance obligations under the (depending on firm size). For purposes annual transaction screening, and
proposed rule. Based on market research of cost estimation FinCEN and OFAC recordkeeping.487 These costs are
and given the wide range of customers conservatively assign each PPSI a outlined in Table 11. Smaller PPSIs are
that PPSIs interact with,486 FinCEN and $20,000 cost in the first year, for a expected to experience costs at the
OFAC estimate that such technology maximum total incremental cost of $1 lower ends of the ranges mentioned
costs, which may include licensing fees million annually for 50 PPSIs. In above.
TABLE 11—ESTIMATED INCREMENTAL ANNUAL TECHNOLOGY COST
Estimated
Cost per
Years number of Total cost
PPSI PPSIs
1 ............................................................................................................................................................... $20,000 50 $1,000,000
2+ ............................................................................................................................................................. 10,000 50 500,000
8. Information Sharing Because banks and MSBs are already of engaging in money laundering or
required to comply with section 314(a), terrorist financing. Most PPSIs’ primary
The proposed rule would apply the FinCEN does not contemplate this as an market customers are financial
information sharing provisions at incremental cost. In addition, FinCEN institutions or other legal entities which
§ 1010.520, also known as 314(a), and generally only transmits 314(a) requests have generally not been the subject of
§ 1010.540, also known as 314(b), to to a limited subset of the financial 314(a) requests. Because PPSIs
PPSIs, described in section VI.C.10. institutions that are required to comply nevertheless may receive 314(a) requests
Section 1010.520 requires a financial with 314(a) requirements in any given in the future that require a response,
institution to search its records upon year. Historically, the proportion of FinCEN assigns a nominal annual
receipt of a request from FinCEN and potentially affected financial burden for this activity of one hour,
provide information in return. Section institutions required to provide a commensurate with the expectation that
1010.540 is a voluntary information response in a given year has remained PPSIs may be less likely to maintain
sharing tool of which a financial below three percent.488 The subjects of accounts or conduct transactions with
institution may, but is not required, to 314(a) requests are individuals and individuals or entities that are the
avail itself. entities suspected by law enforcement subject of 314(a) requests.
TABLE 12—ESTIMATED ANNUAL COST ASSOCIATED WITH 314(A) REQUESTS
Number
Cost per
Hours per PPSI of Total cost
PPSI PPSIs
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1 ........................................................................................................................................................................... $125 50 $6,229
485 See supra section VII.B.4. 487 FinCEN and OFAC request public comment on Renewal Without Change on Information Sharing
486 See supra section XII.A.2.ii.d.2. the accuracy and completeness of this estimate. Between Government Agencies and Financial
488 See FinCEN, Agency Information Collection
Institutions, 90 FR 47125 (Sept. 30, 2025).
Activities; Proposed Renewal; Comment Request;
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Under section 314(b), PPSIs would be be subject to special standards of FinCEN estimates the annual hourly
able to share information about diligence. PPSIs would be required to burden of maintaining and updating the
transactions involving the proceeds of maintain due diligence programs for due diligence program for such
specified unlawful activities. This correspondent accounts for foreign correspondent or private banking
would be a voluntary information financial institutions and banks and for accounts would be approximately two
sharing tool of which a financial private banking accounts. These hours for each regulated entity—one
institution may, but would not be programs would include policies, hour to maintain and update the
required to, avail itself. For this reason, procedures, and controls that are program and one hour to obtain the
FinCEN does not attribute an reasonably designed to detect and report approval of senior management.490
incremental burden to activity any known or suspected money However, because these requirements
conducted under section 314(b).489
laundering or suspicious activity already exist for banks and MSBs,
9. Special Standards of Diligence conducted through or involving such FinCEN does not contemplate this as an
As described in section VI.C.11.ii, correspondent or private banking incremental cost.491
under the proposed rule, PPSIs would accounts.
TABLE 13—ESTIMATED ANNUAL COSTS TO ESTABLISH AND MAINTAIN AN ENHANCED DUE DILIGENCE PROGRAM
Number
Cost per
Hours per PPSI of Total cost
PPSI PPSIs
2 ........................................................................................................................................................................... $249 50 $12,458
10. Section 311 and other Special and (2) ensure compliance with all expected to face an immediate, full
Measures existing section 311 final rules. start-up burden (because they are less
For purposes of burden estimation, familiar with the special measures
The proposed rule would require that and taking into account the intended described above), FinCEN assigns a first-
PPSIs comply with special measures scope of the defined term year average burden of eight hours per
issued pursuant to section 311 of the ‘‘correspondent account’’ as presented expected future non-IDI subsidiary
USA PATRIOT Act, 2313a of the in section VI.C.11.i, FinCEN PPSIs and 0.5 hours for each of the 30
Fentanyl Sanctions Act, and section conservatively assumes that all expected future IDI-subsidiary PPSIs.
9714(a) of the Combating Russian projected 50 future PPSIs would be FinCEN then applies the same
Money Laundering Act. To date, equally likely to maintain foreign graduated declining burden model as
FinCEN has issued several final rules correspondent accounts and incur costs employed in its section 311 60-day
pursuant to section 311 imposing the associated with the proposed obligation notice, estimating that in subsequent
fifth special measure to prohibit covered to comply with the various types of years, all 50 expected future PPSIs
financial institutions from opening or special measures. Borrowing from the would incur an average annual burden
maintaining a correspondent account approach FinCEN utilized in the most of approximately 18-minutes each.
for, or on behalf of, specified entities.492 recent 60-day notice renewing existing Because these requirements already
Future PPSIs would be expected to section 311 OMB control numbers,493 exist for IDIs, FinCEN does not consider
incur burden in complying with this FinCEN continues to apply a graduated the costs presented in table 14 as novel
component of the proposed rule insofar burden model with an anticipated cost incremental costs for future IDI-
as they would both (1) need to establish profile that declines sharply in the years subsidiary PPSIs; however, the costs
and maintain the ability to comply with following the first effective year of a presented in table 15 would be
given special measure. Thus, for future considered an incremental new burden
future impositions of special measures
non-IDI subsidiary PPSIs, who would be for PPSIs that are not IDI subsidiaries.494
TABLE 14—ESTIMATED COSTS ASSOCIATED WITH SPECIAL MEASURES FOR IDI-SUBSIDIARY PPSIS
Hours per Cost per Number of
Year Total cost
PPSI PPSI PPSIs
1 ....................................................................................................................... 0.5 $62 30 $1,869
2+ ..................................................................................................................... 0.3 37 30 1,121
TABLE 15—ESTIMATED INCREMENTAL COSTS ASSOCIATED WITH SPECIAL MEASURES FOR NON-IDI SUBSIDIARY PPSIS
Hours per Cost per Number of
Year Total cost
PPSI PPSI PPSIs
lotter on DSK8BHNXB4PROD with PROPOSALS3
1 ....................................................................................................................... 8 $997 20 $19,933
489 This section does not apply to OFAC related 491 As this section does not apply to OFAC related Renewal Without Change of Information Collection
requirements and as such there were no OFAC requirements, no additional OFAC associated costs Requirements in Connection With the Imposition of
associated costs to consider here. were considered here. Special Measures, 90 FR 57279 (Dec. 10, 2025).
492 See supra section VI.C.11.iii. 494 OFAC is not making a proposal under this
490 FinCEN requests public comment on the
accuracy and completeness of this estimate.
493 FinCEN, Agency Information Collection section and as such, there are no OFAC associated
Activities; Proposed Renewal; Comment Request: costs to be considered here.
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18646 Federal Register / Vol. 91, No. 69 / Friday, April 10, 2026 / Proposed Rules
TABLE 15—ESTIMATED INCREMENTAL COSTS ASSOCIATED WITH SPECIAL MEASURES FOR NON-IDI SUBSIDIARY PPSIS—
Continued
Hours per Cost per Number of
Year Total cost
PPSI PPSI PPSIs
2+ ..................................................................................................................... 0.3 37 20 747
b. Government stablecoin regulators and the IRS. when determining the appropriate
To implement the proposed rule, FinCEN acknowledges that the cost administrative action to take in response
FinCEN expects to incur certain estimates here would therefore to an apparent violation of U.S.
operating costs that would include understate the burden of activities sanctions.496 As FinCEN notes above,
approximately $1.7 million in the year required to promote compliance with OFAC acknowledges that these
prior to the final rule’s effective date, the rules as proposed and the full scope estimates do not include the potential
$5.9 million in the first effective year of of government costs. costs borne by other regulators, or
the final rule, and approximately $2.9 As described above in section, the entities who might foreseeably be
million in the average subsequent year. proposed rule would introduce engaged in informational outreach,
These estimates include anticipated consultation requirements for primary examinations (such as those by the IRS),
expenses related to stakeholder outreach Federal payment stablecoin regulators or related supervisory actions or
and informational support, compliance before initiating significant AML/CFT enforcement activities as a consequence
monitoring, and potential enforcement supervisory actions. FinCEN anticipates of the proposed rule.
activities as well as certain incremental that the proposed consultation process
is likely to have direct economic effects c. PPSI Customers
increases to pre-existing technological
on both FinCEN and the primary As discussed earlier in this
and IT infrastructure, administrative
Federal payment stablecoin regulators. analysis,497 based on the median value
and logistic expenses, primarily related
The proposed process could also of customers, FinCEN and OFAC expect
to data collection and analysis.
FinCEN acknowledges that this reasonably be expected to have indirect that the typical PPSI would have
treatment of cost estimates implicitly effects on the PPSIs subject to approximately 100 legal entity clients
assumes that increased resources supervision and examination to the that it interacts with directly. However,
commensurate with any novel operating extent that the consultative process is some PPSIs are expected to have
costs would exist. If this assumption successful in better aligning supervisory substantially more than this, and
does not hold, then operating costs and enforcement activities with the FinCEN and OFAC apply an average of
associated with this rule may impose efficient establishment and maintenance 1,000 customers per PPSI. In total,
certain economic costs on the public in of AML/CFT programs. Finally, while FinCEN and OFAC do not expect the
the form of opportunity costs from the further downstream economic effects aggregate number of direct PPSI
agency’s forgone alternative activities may also flow to the general public from customers to exceed 300,000. However,
and those activities’ attendant benefits. this improved alignment, these effects FinCEN and OFAC estimate that a
Benchmarking against FinCEN’s would be third order at best, and substantial portion of these may be
appropriated budget for BSA difficult to distinguish from the effects affiliates of a single counterparty or
administration and analysis in fiscal of other incremental components of the associated with non-U.S. entities.
year 2025 ($190,193,000),495 the proposed rule. Thus, despite FinCEN and OFAC estimate that the
acknowledging that economic effects of number of affected U.S. businesses is no
corresponding opportunity cost could
the proposed regulatory changes more than 10,000.
resemble forgoing up to 3.1 percent (1.5
applicable to primary Federal payment As described earlier,498 these
percent) of current activities annually in
stablecoin regulators may reach to PPSIs businesses belong to several industrial
the first year (each subsequent year) in
and the general public, they are not categories, including digital asset
which a final rule was effective.
itemized or further considered in the exchanges, specialized digital
However, to the extent that activities
respective discussions of expected commodities traders, and other types of
FinCEN would undertake as a function
economic effects on these specific investment and securities related
of the proposed rule would functionally
parties. businesses. Aside from digital asset
substitute for or otherwise replace OFAC does not expect to incur exchanges, FinCEN expects that nearly
foregone activities, such an estimate additional operating expenses to all of these firms would be part of the
likely overstates the potential economic implement the proposed rule. While NAICS classifications under industry
costs to FinCEN and, consequently, the OFAC’s Enforcement Division will be code 523 (‘‘Securities, Commodity
public. responsible for investigating and
FinCEN notes that these estimates do Contracts, and Other Financial
enforcing potential violations of the Investments and Related Activities’’).
not include the potential costs borne by proposed rule, OFAC expects that these
other regulators or entities who might Based on this assessment, FinCEN and
efforts would be folded into their OFAC applied the associated standard
foreseeably be engaged in informational existing enforcement responsibilities
outreach, examinations or related wage rate to estimate the costs of PPSI
and that investigations into violations of customers’ time.499
supervisory actions or enforcement
lotter on DSK8BHNXB4PROD with PROPOSALS3
the sanctions compliance program
activities as a consequence of the requirement would occur in conjunction 496 31 CFR part 501, Appendix A.
proposal. Such regulators and entities with investigations into violations of 497 See supra section XII.A.2.ii.d.2.
include the primary Federal payment other U.S. sanctions regulations. As 498 See id.
499 Because FinCEN and OFAC expect most
495 See, FinCEN, Congressional Budget
noted in section V.B, OFAC already
primary market customers to be legal entities in the
Justification FY 2026, available at https://
considers the existence, nature, and financial sector, it applies the standard wage rage,
home.treasury.gov/system/files/266/11.-FinCEN-FY- adequacy of a subject person’s risk- which is broadly reflective of expected wage costs
2026-CJ.pdf. based sanctions compliance program for a wide range of financial institutions. This
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Federal Register / Vol. 91, No. 69 / Friday, April 10, 2026 / Proposed Rules 18647
While FinCEN and OFAC estimate (specifically, information about frequency may fluctuate. In order to
that a significant portion of these beneficial ownership). Table 16 generate a conservative estimate,
entities may be subsidiaries of a single provides a summary of the expected FinCEN and OFAC assume for purposes
counterparty or connected to non-U.S. costs to these customers. FinCEN and of this analysis that all primary market
entities, PPSIs would still be OFAC estimate that PPSI customers, participants would be required to
responsible for verifying the identities which are mostly financial institutions provide this information once during
of all connected counterparties in order engaged in trading a broad range of the course of business in a given year
to meet program obligations. FinCEN stablecoin products as part of their when interacting with a new stablecoin
and OFAC expect that each customer investment portfolios, or exchanges issuer, while acknowledging significant
would be required to spend seeking to provide off-chain liquidity to
uncertainty around this estimate.
approximately one hour to collect, retail customers for a similarly broad
FinCEN and OFAC request public
review, and transmit the required range of stablecoin products, will likely
comment on this assumption.
customer identification information to initiate at least one new primary market
the stablecoin issuing counterparty relationship each year, although this
TABLE 16—ESTIMATED ANNUAL COST TO CUSTOMERS OF PROVIDING REQUIRED IDENTIFICATION MATERIALS
Hours per Cost per
Total number of customers Total cost
customer customer
10,000 .......................................................................................................................................... 1 $125 $1,245,800
5. Consideration of Policy Alternatives some category of PPSI for small issuers additional information in the ordinary
that would entail lessened AML/CFT course of business, and are best situated
In developing the proposed rule,
requirements would conceivably result to determine what, if any, additional
FinCEN and OFAC considered several
in the targeting of these PPSIs by illicit information is necessary to make risk-
policy alternatives, including
actors seeking to circumvent regulatory based decisions about a customer.
alternatives that would, if adopted,
scrutiny. Additionally, FinCEN’s Secondly, the absence of this
imply differences in the cost profile of
analysis indicates that most technology information does not exempt an issuer
the requirements, particularly for small
services that enable AML/CFT functions from the responsibility to assess the risk
entities. FinCEN and OFAC invite
as described here are highly scalable, associated with a customer or their
comment on these alternatives, and on
allowing small PPSIs to readily identify transactions, and therefore it is the
any other alternatives that were not
and employ more cost-effective options. imperative of the issuer to determine
considered here.
b. Alternative Information Requirements whether or not such additional
i. FinCEN Alternatives
FinCEN separately considered a information is necessary to conduct
a. Size-Related Alternatives version of the proposed rule that would risk-based screening and analysis.
First, FinCEN considered modifying have required PPSIs to collect, and FinCEN concluded that it would strike
the proposed rule’s requirements for customers to provide, additional a more appropriate balance of
small entities or establishing an asset information beyond what this NPRM anticipated benefits to expected costs to
threshold for certain proposed would require. For example, in addition refrain from imposing a unilateral
compliance obligations. As discussed in to the proposed rule’s requirement that requirement that such additional
more detail in the IRFA analysis future PPSIs collect the name, date of information be collected in every
(section XII.C.2.i.b below), FinCEN birth, address, and government-issued instance and that instead it would be
utilizes a threshold of $200 million in identification number for the beneficial more economically efficient to defer in
total reserve assets to define small PPSIs owners of a legal entity customer (as these aspects to the discretion of the
that are not IDI subsidiaries. FinCEN defined under 31 CFR 1010.230, but PPSI’s risk-based determinations. In
considered using this threshold as a generally meaning one executive officer declining to pursue this alternative,
tailoring benchmark, whereby PPSIs and all individuals with 25 percent or FinCEN also took into consideration
under the threshold might have been more equity interest in the entity), that it may also comport more closely
afforded burden accommodations in the FinCEN considered further requiring with the GENIUS Act requirement that
form of additional time to transition, or PPSIs to collect customers’ blockchain Treasury issue regulations tailored to
additional time to undertake certain wallet addresses associated with the the size and complexity of the PPSI to
required activities, potentially legal entity, incorporation or tax limit the information requirements as
differential reporting thresholds, or documents, or certain identifying
proposed. FinCEN requests comment on
other modifications to AML/CFT financial information such as account
the extent to which this assessment
program standards designed to reduce numbers. However, FinCEN opted not to
comports with market expectations and
compliance cost. However, FinCEN require these items for several reasons.
opted against this alternative. Creating First, many issuers already collect this practices.
lotter on DSK8BHNXB4PROD with PROPOSALS3
hourly wage rate is a general composite hourly industry codes that FinCEN determined are most cost to the employer. The benefit factor is the ratio
wage rate ($87.61) scaled by a private sector directly comparable to its 11 categories of of total compensation (which includes wages and
benefits factor of 1.42 ($124.58 = $87.61 × 1.42). potentially affected financial institutions as benefits) to wages. Total compensation = 43.94 and
This incorporates BLS mean wage data associated delineated in 31 CFR parts 1020 to 1030. See BLS, Wages and salaries = 30.90 (1.42 = 43.94 ÷ 30.90)
with six occupational codes (11–1010: Chief May 2024—National industry-specific and by
as of June 2024, based on the private industry
Executives; 11–3021: Computer and Information ownership, available at https://www.bls.gov/oes/
Systems Managers; 11–3031: Financial Managers; tables.htm. Given that many occupations provide workers series data downloaded from BLS. BLS,
13–1041: Compliance Officers; 23–1010: Lawyers benefits beyond wages (e.g., insurance and paid Employer Costs for Employee Compensation data,
and Judicial Law Clerks; 43–3099: Financial Clerks, leave), FinCEN applies the private sector benefit available at https://www.bls.gov/news.release/
All Other) for each of the nine groupings of NAICS factor to the unloaded wage rate to reflect the total archives/ecec_09102024.pdf.
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18648 Federal Register / Vol. 91, No. 69 / Friday, April 10, 2026 / Proposed Rules
c. Block, Freeze, and Reject Alternative The 2019 Compliance Framework has This proposed rule has been
FinCEN separately and additionally been a cornerstone of OFAC’s regular designated a ‘‘significant regulatory
considered providing a more detailed public outreach to all regulated action’’; accordingly, it has been
regulation related to the requirement for industries. Likewise, the compliance reviewed by OMB.
PPSIs to have the technical capability, guidance and expectations detailed in E.O. 14192, entitled ‘‘Unleashing
policies, and procedures to block, the 2019 Compliance Framework Prosperity Through Deregulation,’’ was
freeze, and reject specific or consistently form the basis of OFAC’s issued on January 31, 2025. Section 3(c)
impermissible transactions that violate published guidance (e.g., sanctions of the order requires that any new
Federal or State laws, rules, or advisories, compliance communiqués, incremental costs associated with new
regulations. For example, FinCEN could and frequently asked questions). regulations shall, to the extent permitted
have provided details on the specific Consequently, the sanctions compliance by law, be offset by the elimination of
technical capability, policies, and community is already highly familiar existing costs associated with at least
procedures that would be required or with the proposed rule’s requirements ten prior regulations.
as consistent with existing OFAC If finalized as proposed, this action is
required a PPSI to take proactive action
guidance. Additionally, FinCEN’s AML expected to be considered an E.O. 14192
related to this requirement. This might
requirements at 31 CFR 1020.210 and regulatory action.
have required a PPSI to act if it had a
reason to know the transaction was OFAC’s existing regulations differ in C. Regulatory Flexibility Analysis
impermissible. However, FinCEN applicable scope; the former center on
traditional banks, whereas the latter When an agency issues a proposed
decided against these alternatives. rulemaking, the RFA requires the agency
Providing a more detailed regulation apply to all U.S. persons. The 2019
Compliance Framework’s focus on U.S. either to provide an IRFA or certify that
could have limited how a PPSI could the proposed rule would not have a
comply with this requirement. FinCEN persons, rather than financial
institutions, is therefore better aligned significant economic impact on a
decided it was important for PPSIs to substantial number of small entities.
have the flexibility to implement new with future PPSI’s obligations as U.S.
persons under the GENIUS Act. Finally, Because the proposed rule may have a
technology, best practices, and adapt to significant economic impact on a
changing laws, rules, or regulations. the 2019 Compliance Framework is
grounded in the principle of a risk- substantial number of certain types of
FinCEN also considered that proposing PPSIs that may qualify as small entities,
a more proactive requirement could based approach to sanctions
compliance. This foundation supports FinCEN and OFAC undertook the
increase the compliance burden for following analysis. In the event that
PPSIs. In sum, FinCEN’s decision not to PPSI flexibility and discretion in how to
meet the GENIUS Act’s requirement of FinCEN and OFAC have potentially
pursue a proposed rule that included overestimated the anticipated economic
this alternative formulation was an effective sanctions compliance
program within the context of burden of the proposed rule, and
informed by its belief that the certification would instead be more
alternative would not strike a preferable maintaining the five minimal elements
in the proposed rule. This flexibility not appropriate, comments to this effect—
balance between the anticipated benefits including studies, data, or other
and the expected costs or be as only accounts for the development and
implementation of new technology but evidence—are invited.
economically efficient as the more
flexible formulation proposed. FinCEN also is consistent with the GENIUS Act’s 1. The Proposed Rule: Objectives,
is requesting comment on the extent to direction that regulations be tailored to Description, and Legal Basis
which this assessment comports with the size and complexity of the PPSI.500
OFAC is requesting comment on the The proposed rule would implement
market expectations. FinCEN’s regulations that prescribe BSA
extent to which this assessment
ii. OFAC Alternatives comports with market expectations and obligations and OFAC’s sanctions
practices. compliance program requirement for
Additionally, OFAC considered PPSIs as described in sections VI, VII,
basing the minimal elements for a B. Executive Orders 12866, 13563, and and XII.A.3.
sanctions compliance program on 14192 The GENIUS Act, enacted on July 18,
FinCEN’s current AML program 2025, the legal basis for the proposed
requirements for banks at 31 CFR E.O. 12866 directs agencies to assess rule, creates a regulatory framework for
1020.210. For example, that alternative the costs and benefits of available PPSIs in the United States.501 The
regulatory foundation would require: (1) regulatory alternatives and, if regulation GENIUS Act provides a comprehensive
a system of internal controls to assure is necessary, to select regulatory framework for the regulation of payment
ongoing sanctions compliance; (2) approaches that maximize net benefits stablecoins.502 The GENIUS Act
independent testing for compliance to (including potential economic, outlines the reserve, capital, liquidity,
be conducted by the PPSI’s personnel or environmental, and public health and and risk management requirements for
by an outside party; (3) designation of safety effects; distributive impacts; and PPSIs and tasks the Board, FDIC, NCUA,
an individual or individuals responsible equity). E.O. 13563 emphasizes the and OCC, as well as any State payment
for coordinating and monitoring day-to- importance of quantifying both costs stablecoin regulators, with
day compliance; (4) training for and benefits, reducing costs, implementing those requirements and
appropriate personnel; and (5) harmonizing rules, and promoting establishing a process and framework
appropriate risk-based procedures for flexibility. E.O. 13563 also recognizes for the licensing, regulation,
that some benefits are difficult to
lotter on DSK8BHNXB4PROD with PROPOSALS3
conducting ongoing customer due examination, and supervision of
diligence. Although these requirements quantify and provides that, where PPSIs.503
are similar in substance to the proposed appropriate and permitted by law, The proposed rule seeks to implement
rule, OFAC chose to instead align the agencies may consider and discuss the GENIUS Act by requiring that PPSIs
proposed minimal elements of a qualitatively values that are difficult or
sanctions compliance program with impossible to quantify. 501 See GENIUS Act, Pub. L. 119–27.
existing OFAC guidance, particularly 502 See id.
the 2019 Compliance Framework. 500 See 12 U.S.C. 5903(a)(5)(B). 503 See supra section II.A.
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Federal Register / Vol. 91, No. 69 / Friday, April 10, 2026 / Proposed Rules 18649
‘‘be treated as a financial institution for subsidiaries of banks (including credit FDIC, and NCUA (the ‘‘Agencies’’) with
purposes of the Bank Secrecy Act, and unions); those that are Federal qualified implementing reserve, capital, liquidity,
as such, shall be subject to all Federal payment stablecoin issuers (FQPSIs); 506 and risk management requirements for
laws applicable to financial institutions and State qualified payment stablecoin PPSIs. The OCC, FDIC, and NCUA have
located in the United States relating to issuers (SQPSIs).507 FinCEN has recently published other NPRMs
economic sanctions, prevention of incorporated the OCC, FDIC, Board, and necessary to implement the GENIUS
money laundering, customer NCUA’s RFA analyses with respect to Act.508 Because each of these proposed
identification, and due diligence.’’ 504 their nexuses with these respective rules has already provided the
The GENIUS Act directs the Secretary types and limited its own further operational definition of ‘‘small’’ used
of the Treasury to issue regulations, analysis below to the remaining to scope the respective estimated
tailored to the size and complexity of potential future PPSIs that it anticipates.
the PPSI, implementing the AML/CFT populations of small IDIs that would
As the proposed rulemaking may also also be relevant for the RFA analysis in
and sanctions compliance requirements impact the small entities that are
directed by the GENIUS Act.505 this proposed rule, FinCEN and OFAC
customers of PPSIs, this population was
are adopting those analyses and
2. The Expected Impact on Small also subject to IRFA requirements and is
included in section XII.C.2.i.d. estimates by reference. Table 17
Entities provides a summary of the incorporated
i. Defining Small Affected Entities a. Small PPSIs Regulated by the estimates below.
Agencies
The impact of the rule on small
entities varies across the three distinct As discussed in section II.A, the
types of PPSIs: those that are GENIUS Act tasks the OCC, Board,
TABLE 17—RFA POPULATIONS REPORTED BY THE AGENCIES a
Number of
Total Percentage
Agency small
population small
institutions
FDIC ............................................................................................................................................. 2,772 2,064 74.5%
Board ........................................................................................................................................... 702 440 62.7
OCC ............................................................................................................................................. 997 609 61.1
NCUA ........................................................................................................................................... ........................ ........................ b 19
a Data is based on consultation with the Agencies. See also FDIC, Approval Requirements for Issuance of Payment Stablecoins by Subsidi-
aries of FDIC-Supervised Insured Depository Institutions, 90 FR 59409 (Dec. 19, 2025); NCUA, Investments in and Licensing of Permitted Pay-
ment Stablecoins Issuers, 91 FR 6531 (Feb. 12, 2026); OCC, Implementing the Guiding and Establishing National Innovation for U.S.
Stablecoins Act for the Issuance of Stablecoins by Entities Subject to the Jurisdiction of the Office of the Comptroller of the Currency, 91 FR
10202 (Mar. 2, 2026).
b. Other PPSIs NAICS code 523160 as Commodity Specifically, an asset-based threshold is
The SBA publishes annual size Contracts Intermediation. The SBA- a standard better suited to identifying
thresholds defining small businesses by defined threshold for a small business genuinely small stablecoin issuers. As
their classification under categories of in this category is $47 million in gross discussed earlier, stablecoin issuers
the NAICS. While there is currently no receipts. Among these categories, the primarily generate revenue through
NAICS category specifically for most appropriate designation for capital appreciation and other
stablecoin issuers, FinCEN and OFAC stablecoin issuers, due to their role as investment returns on their reserve
anticipate that they would most money transmitters, is Financial holdings rather than receipts from the
appropriately fit within several broader Transactions Processing, Reserve, and sale of goods or services. Moreover, a
categories of financial institution. Most Clearinghouse Activities (522320), with stablecoin issuer’s investment returns
stablecoin issuers meet the definition of an SBA-defined threshold for a small may be attributable primarily to
MSBs, and therefore belong either to business of $47 million in annual gross fluctuations in interest rates and other
Financial Transactions Processing, receipts. market factors, meaning that a
Reserve, and Clearinghouse Activities However, because the number of stablecoin issuer may produce vastly
(522320) (most appropriate for those potential future PPSIs (as defined under different returns over time with
that engage in money transmitting), or the GENIUS Act) is small relative to the virtually no change in size. Accordingly,
Other Activities Related to Credit number of total firms in this NAICS we do not believe that the gross receipts
Intermediation (522390). The SBA- category, and because most stablecoin standard provides an appropriate means
defined threshold for a small business issuers generate revenue in a manner for FinCEN and OFAC to identify small
in these categories is $47 million and unlike other MSBs, FinCEN and OFAC stablecoin issuers for purposes of the
$28.5 million in gross receipts, considered that an alternative threshold RFA.
respectively. In addition, because digital might be better suited to identify a To determine an appropriate asset-
assets may sometimes be classified as ‘‘small entity’’ based on the current based threshold, FinCEN and OFAC
lotter on DSK8BHNXB4PROD with PROPOSALS3
commodities, some stablecoin issuers distribution and characteristics of developed a profile of the stablecoin
might otherwise be categorized under entities in the stablecoin industry. sector, which includes all affected
504 12 U.S.C. 5903(a)(5)(A). 506 12 U.S.C. 5901(11). FinCEN proposes to define same language as the statute. See supra section
505 See 12 U.S.C. 5903(a)(5)(B); see also supra this category in its regulations using essentially the VI.C.1.xiii.
note 15 (discussing GENIUS Act delegation to same language as the statute. See supra section 508 See supra note 11. See also infra section
VI.C.1.xi.
Directors of FinCEN and OFAC). 507 12 U.S.C. 5901(31). FinCEN proposes to define
XII.C.3.
this category in its regulations using essentially the
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18650 Federal Register / Vol. 91, No. 69 / Friday, April 10, 2026 / Proposed Rules
stablecoin issuers as well as small the Act. Among the stablecoin issuers $200 million total asset threshold would
businesses. Stablecoin issuers generally reviewed, the mean total asset value was represent less than one percent of total
earn revenue using their reserve funds about $5.6 billion. However, the assets in the industry as being held by
in a way similar to many other types of distribution of assets across stablecoin small entities but would encompass 84
asset managers. Therefore, total reserve issuer is highly skewed, with a percent of likely payment stablecoin
fund assets (‘‘total assets’’) is a good significant concentration of assets at the issuers for which data could be obtained
measure by which to define ‘‘small very largest stablecoin issuers. (approximately 40 entities, 19 of which
entities’’ in this industry, similarly to Accordingly, the median value was were identified as potential PPSIs). This
the way banks or investment companies significantly less than the mean, about results in a distribution of small entities
are often measured. As discussed in $14 million.
which is fairly robust to the threshold;
section XII.A.2.ii.a, FinCEN and OFAC FinCEN and OFAC estimate that over
99 percent of potential payment doubling the threshold $400 million
examined public data on the issuers of
over 350 stablecoin products using stablecoin total assets are held by the would result in an identical distribution
publicly available data from several top five stablecoin issuers. Table 18 and halving it to $100 million would
sources, which included metrics on the provides a summary of total asset result in the exclusion of six issuers,
circulating value of each product. thresholds by percentile based on public resulting in 71 percent of stablecoin
Because every USD fiat currency-backed data about the total circulating value of issuers being below the threshold.
stablecoin issued is backed by an issuer’s associated stablecoins. Eighty-four percent of stablecoin issuers
equivalent value in USD, the circulating Considering this concentration, FinCEN falling below the threshold is consistent
value is a good indication of the size of and OFAC propose using a threshold with the distributions of other similarly
the stablecoin issuer’s reserve fund total value of $200 million in total assets to concentrated finance-related industries.
assets. define a small PPSI, which is roughly In considering the adoption of a $200
Taken as a whole, stablecoin issuers the 80th percentile value. FinCEN and million total asset threshold to designate
managed a total of about $300 billion in OFAC request public comment on the
PPSI size for RFA purposes, FinCEN
total assets as of 2025, with about $250 suitability of this threshold. This value
and OFAC considered the following
billion of this value being held by also falls close to the mean total asset
issuers of products likely to be eligible value for issuers below the top five population distribution information for
for status as a payment stablecoin under percent of firms. Using the proposed stablecoin issuers:
TABLE 18—STABLECOIN ASSET THRESHOLD ANALYSIS (ALL STABLECOINS)
Percentage
Percentage of aggregate
Net asset of issuers
Percentile net assets
threshold below below
(%) (%)
10th ...................................................................................................................................... $300,660 11 0.0002
20th ...................................................................................................................................... 887,584 18 0.0007
30th ...................................................................................................................................... 3,952,000 22 0.0021
40th ...................................................................................................................................... 10,260,054 36 0.0172
50th ...................................................................................................................................... 13,670,000 47 0.0420
60th ...................................................................................................................................... 33,446,620 58 0.0788
70th ...................................................................................................................................... 62,497,337 67 0.1571
80th ...................................................................................................................................... 173,946,000 78 0.3486
90th ...................................................................................................................................... 734,997,872 87 0.7767
100th .................................................................................................................................... 173,113,000,000 98 32.3282
c. Small SQPSIs that the proposed rule, if adopted, may that there are approximately 300,000
impose costs on the primary market primary market customers that could, in
At this time there is insufficient data
customers of future PPSIs that are legal the future, interact directly with PPSIs,
to separately forecast a population of
potential future SQPSIs. It is therefore entities because these PPSI customers of which the number of affected
not possible to assess the proportion of would need to collect and provide customers that may be U.S. businesses
that potential future population that information to their respective PPSIs, is expected to be no more than 10,000.
would be considered small for purposes who would have initiated the requests As described earlier,510 these businesses
of this analysis or assess the for customers’ information as a belong to several categories, including
appropriateness of an additional consequence of the need to satisfy digital asset exchanges, specialized
alternative definition of ‘‘small’’ certain requirements in the proposed digital commodities traders, and other
uniquely applicable to SQPSIs with any rule. FinCEN and OFAC anticipate that types of investment and securities
meaningful degree of certainty. many of these affected PPSI customers related businesses, the majority of
Comments and data are invited to assist would be digital asset exchanges, which would be classified under NAICS
specialized digital commodities traders, code 523 (‘‘Securities, Commodity
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FinCEN and OFAC in analyzing the
potential effects of the proposed and other types of investment and Contracts, and Other Financial
requirements on SQPSIs, generally, and securities-related firms, at least some of Investments and Related Activities’’).
small SQPSIs in particular. whom may be small businesses for Table 19 summarizes FinCEN and
purposes of the RFA. As described OFAC’s analysis of the most recent
d. Small Entity PPSI Customers earlier,509 FinCEN and OFAC estimate vintage of Census Bureau data
Additionally, as discussed in section
XII.A.2.ii.d.2, FinCEN and OFAC expect 509 See supra section XII.A.2.ii.d.2. 510 Id.
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Federal Register / Vol. 91, No. 69 / Friday, April 10, 2026 / Proposed Rules 18651
corresponding to this NAICS code, that are expected to be the primary
which indicates that small business market customers of future PPSIs.
comprise the majority of the industries
TABLE 19—DESCRIPTION OF PPSI CUSTOMER SMALL ENTITIES
Approximate Average annual revenue
Primary market customer SBA small-business Percentage considered
number of NAICS code
type threshold small a of small entities b
customers
Digital Exchanges ............ 300 523210 $47 million ...................... 70% (about 210 firms) .... $5.85 million.
Other Investment Firms ... 10,000 523 $47 million ...................... 97.7% (about 9,770 $1.55 million.
firms).
a To estimate the number of small entities in this sector, FinCEN and OFAC used the U.S. Census Bureau, 2022 Statistics of U.S. Businesses
Data by Enterprise Receipts Size, available at https://www.census.gov/data/tables/2022/econ/susb/2022-susb-annual.html (‘‘2022 SUSB Data’’).
FinCEN and OFAC counted the proportion of small businesses in NAICS code 523 with less than $50 million in annual receipts (the closest
available threshold). For Digital Exchanges, FinCEN used internal data.
b Revenue data for NAICS code 523 and Digital Exchanges was collected from the 2022 SUSB Data and internal data.
ii. Estimating the Economic Impact on 1. Estimated Number of Small Potential estimated that stablecoin issuers were
Small Future PPSIs PPSIs likely to receive returns of about five
The SBA definition of ‘‘small entity’’ percent on invested funds. While actual
a. Small IDI Subsidiaries
at 13 CFR 121.201 includes businesses, returns may fluctuate and fall below or
As in section XII.C.2.i.a, FinCEN and nonprofits, and small government above this estimate, this value
OFAC are adopting by reference the entities with less than 50,000 residents. represents an average for estimation
applicable RFA analyses performed by It is worth noting that some stablecoin purposes. To validate this assumption,
the OCC, FDIC, and NCUA. FinCEN and issuers are organized as nonprofit FinCEN reviewed actual reported
OFAC are relying on the data provided entities and are included in this count. revenue values. While five percent of
and determinations already made by the Based on analysis of the distribution total assets was generally within the
of data described above,512 FinCEN and same order of magnitude as actual
Agencies with respect to the
OFAC are proposing a ‘‘small entity’’ reported revenue, actual revenues often
characteristics of expected future PPSIs
definition that corresponds closely to exceeded five percent.
under their jurisdictions because such Returns more than prevailing rates for
agencies are better positioned to the 80th percentile threshold, which
was rounded to $200 million for government-issued fixed income
understand the nature of their regulated securities can be due to several factors.
entities in a manner that could convenience in the proposed rule. The
proposed $200 million threshold would First, issuers often ‘‘over collateralize’’
reasonably inform future their products, meaning that they hold
expectations.511 As discussed in the capture approximately 84 percent of
stablecoin issuers, which together hold larger reserve portfolios than are
Agencies’ analyses, there is a general required to redeem every coin at par
anticipation that future PPSIs that approximately one percent of aggregate
average total assets. value. This practice helps protect from
would be IDI subsidiaries would not be market fluctuations and affords issuers
Using the same methods discussed
able to qualify as small by virtue of the greater flexibility during times of
earlier,513 FinCEN and OFAC identified
dollar amount of their own offering/ 25 potential future PPSIs from among financial stress. In such cases,
issuance. Additionally, it is not clear these stablecoin issuers, and among stablecoin issuers have reserve
that the subsidiary of an institution that these, approximately 19 had fewer than portfolios that are larger than the
is not itself small would be eligible to $200 million in total circulating circulating value of their products,
obtain an independent designation as stablecoin product values. leading to returns in excess of those
small. For these reasons, it may be implied by multiplying their circulating
unlikely that a small IDI-subsidiary PPSI 2. Expected Effect on FQPSIs value by prevailing rates of return for
could exist. FinCEN and OFAC are To contextualize the relative common reserve investments.
requesting comment on (1) the significance of costs associated with the Stablecoin issuers may also invest
reasonableness of an expectation that a proposed rule for small stablecoin excess reserves in higher-yielding
future small IDI-subsidiary PPSI might issuing entities, FinCEN and OFAC used products or loans whose rates of return
exist and, if so (2) the expected the estimates of total assets described exceed those of government-backed
significance of the proposed rule’s earlier to estimate likely revenues for securities. In addition to this, several
economic impact on such a small entity. such issuers.514 As referenced earlier,515 other factors might lead to larger
stablecoin issuers generally derive returns. For example, stablecoin issuers
b. Other PPSIs revenue from investment returns on may offer certain fee-based services to
their reserve holdings. As stated in the customers, and may account for certain
To examine the expected impact of unrealized gains as revenue, increasing
the proposed rule on small entities, Act, PPSIs are permitted to invest
reserve funds in several different types reported revenue levels.
FinCEN and OFAC used two steps: the
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of asset class, including government Bearing these factors in mind, FinCEN
first step estimates the total number of and OFAC retained five percent of total
backed securities. Based on prevailing
small entities affected by the proposed assets as a reasonable benchmark for
interest rates, FinCEN and OFAC
rule, and the second step estimates the