Overview

• The request seeks public feedback on four technology areas—APIs, artificial intelligence, digital identity verification, and blockchain monitoring—to detect illicit finance in digital assets.
• One option under review would embed identity and KYC/AML credentials into DeFi smart contracts before transactions execute, drawing questions about privacy, costs, and the impact on permissionless protocols.
• Comments are due by October 17, 2025 through the Federal Register, with findings to inform recommendations to Congress and subsequent agency rulemaking.
• The GENIUS Act, signed in July, created a federal framework requiring stablecoin issuers to hold full reserves, undergo audits, and comply with anti-money-laundering and sanctions rules.
• Banking groups led by the Bank Policy Institute warn that perceived loopholes could enable yield-like products and reroute as much as $6.6 trillion in deposits from traditional banks.