Circle submits comment letter regarding US SEC's proposed crypto asset regulations

Circle has submitted comments to the U.S. Securities and Exchange Commission (SEC) regarding its proposed crypto asset regulatory rules. Circle supports the proposal’s goals of fostering innovation under clear rules while preserving the strengths of U.S. capital markets, including transparency, investor protection, market integrity, liquidity, and efficiency. Circle also recommends that crypto asset regulatory rules align with the GENIUS Act. Given that payment stablecoins are increasingly serving as key consideration and settlement assets for on-chain capital formation, Circle requests the SEC to clarify how GENIUS Act-compliant payment stablecoins may be used for these purposes. The letter further asks the commission to clarify that eligible payment stablecoins qualify as “cash” under proposed Rule 302(b), warranting appropriate U.S. dollar valuation treatment, and compliance with corresponding accounting and customer reserve requirements. Circle also recommends reducing the current 2% broker-dealer discount for GENIUS-compliant payment stablecoins to zero, provided objective safeguards are in place. Finally, Circle requests the SEC to clarify that technical services provided after a network goes live—including maintaining a known set of validator nodes—do not constitute necessary administrative work. Establishing a safe harbor rule for technical roadmaps would allow issuers to continue maintaining and improving operational networks without inadvertently triggering related regulatory scrutiny.