Tag: blockchain

TDC’s Artificial Intelligence (AI) Policy Principles 

by Mary Grace Cooney

As AI is increasingly integrated into our lives and national infrastructure, The Digital Chamber (TDC) has built policy principles to ensure that these vital systems preserves innovation, resiliency, safety, and a responsible federal-state regulatory harmonization that provides clear direction and protections for relevant stakeholders in the AI ecosystem.  Specifically, the United States must refine regulations to leverage decentralized AI and AI development that supports open and democratic governance – technological remedies to many legacy AI roadblocks and concerns. 

TDC supports the following principles that we intend to use to guide our AI policy engagement: 

1. Mitigating Bias: Bias Audits Should Be Effective, Outcomes-Based, Transparent, and Public 

AI systems should be tested for fair and non-discriminatory outcomes across their full lifecycle, not certified only once at launch.  

TDC supports making bias-audit results available for regulator and public review, with the FTC and state attorneys general able to act where a consistent pattern of failed audits reveals discriminatory outputs. Bias audits should be tied to reasonable mitigation requirements, and at no point should mitigating bias be treated as the introduction thereof. Responsibility for biased outputs should generally rest with the deployer, the entity closest to the person affected, rather than falling equally on every upstream developer. The goal is a standard that measures results, rather than intent, as AI is definitionally incapable of producing ‘intent’ necessary for disparate-treatment claims. 

2. Model Safety: Safety Disclosure Should Scale with Use Case, Not Model Size 

Safety testing should be continuous and include:  

  • pre-deployment evaluation 
  • active monitoring,  
  • an established process for addressing failing systems in real time 

TDC supports disclosure requirements for safety testing results, calibrated to expected use case, user base, and associated risks, rather than model size alone. Systems deployed in healthcare, hiring, housing, or against a vulnerable population should meet a higher bar than a narrow tool with limited exposure, regardless of scale. Risk thresholds should reflect input from the people who bear the consequences of failure, and the workforce that identifies harm(s)deserves protections of its own. 

Further, catastrophic risks have received outsized attention compared to more common violations of user rights and well-being. Both catastrophic and quotidian risks must be addressed. 

3. Liability and Accountability: Accountability Should Follow Supply-Chain Role 

Liability should track function: developers and deployers should each be accountable for harms tied to their specific role, and content-neutral infrastructure providers in a decentralized AI operating system should not be shoehorned into one of these existing categories. 

  • Developers supply capability and are typically liable for defects in the underlying model (e.g., Meta is the developer of the Llama series). A party that modifies an existing model also takes on developer obligations where that modification expands the capability surface, alters the action space, or degrades safeguards; 
  • Deployers refine capability and put it into use. This covers parties that fine-tune a model to narrow it within the intended purposes and documented limitations, and the entity that chooses to place a system into service. Deployers sit closest to the affected person and carry the greatest share of responsibility for outcomes in use. A deployer that narrows a model should publish its intended-use documentation and test for drift within that window; 
  • End Users query or operate an AI system. Where the user and the affected person are the same, accuracy limits are disclosed, and a free and prompt remedy is available, liability should not run upstream for use outside the developer’s/deployer’s stated parameters. This limit does not apply where the affected person is not the operator, as in lending, hiring, housing, healthcare, and criminal justice. 

These categories describe function, not identity, and are not mutually exclusive. A power user self-hosting a model may be developer, deployer, and end user at once. Contractual allocation should not displace the factual distribution of control. 

Obligations also presuppose a party able to discharge them. Where a layer is permissionless and no entity controls access or output, assigning developer or deployer duties there accomplishes nothing or makes recentralization the only compliance path. Accountability should attach to parties exercising control, applied equally to concentrated and distributed infrastructure. 

This chain should also make room for a distinct category of content-neutral infrastructure providers, including decentralized compute, storage, data-availability, and validation networks that do not select or control the models running on them, who should not inherit developer or deployer liability absent knowing participation in a specific harm (see Principle 9). 

Each party should be able to explain the portion of the process it controls, and affected individuals should receive that explanation without requesting it or litigating for it. 

4. Governance and Oversight: Human Oversight Is the Floor; Direct Governance Can Exceed It 

Human oversight of consequential AI decisions – in lending, hiring, healthcare, housing, and criminal justice, among other high-risk domains – remains essential, as is government accountability. 

Where a community (like a blockchain-based AI DAO) holds governance rights, that direct governance can fulfill accountability requirements.  

Worker organizations and unions should be included as participants in setting oversight standards for AI directly impacting workers in a stakeholder model. Agentic AI should inherently carry identification metadata.  

Further, that identification should extend to verifiable tamper-evident action logs, so an autonomous agent’s decisions can be attributed to a responsible party after the fact rather than reconstructed through litigation (see Principle 13). Mechanisms that build oversight directly into execution, such as network-level alignment nodes, illustrate how decentralized systems can make governance a property of the infrastructure rather than an afterthought. 

5. Data Privacy and Sovereignty: Individuals Should Hold a Strong Claim to Their Own Data 

Meaningful, rather than purely symbolic or perfunctory, control over personal and session data is essential.  

Principled data sovereignty requires that people natively own their data. Privacy-preserving infrastructure, like decentralized identity and zero-knowledge methods, can help realize these protections.  

Regulators should treat these privacy-enhancing technologies, including trusted execution environments and confidential computing, secure multi-party computation, and federated approaches, as affirmative compliance pathways deserving of safe-harbor treatment, rather than viewing their use with suspicion. 

Reasonable limits on data brokers and concentrated data control can help enhance privacy where individual-level tools fall short. TDC also supports updated de-identification standards that account for AI-enabled re-identification risk. 

6. Redefining “Democratic AI”: Legitimacy Comes from Governance, Not Governments 

Democratic legitimacy is measured by how directly an AI stack’s power and governance is checked and how widely it is distributed, rather than by which government’s flag sits on a developer’s S1.  

TDC believes AI development should build toward open, auditable, and decentralized AI, governed by meaningful direct input from the people it affects.  Where that level of direct governance isn’t yet possible, legislative direction and generic guardrails can be a reasonable alternative. 

Widespread use of a technology is not the same as widespread control over it. A system available to everyone and governed by one company is not democratic. Democratic AI should embody the following qualities: 

  • Both control and usage are distributed. Many parties can run a system, but that is not the test. What matters is whether any single entity can unilaterally change the model, revoke access, or set the terms everyone else operates under. 
  • The stack is open and forkable. Weights, training data, and code are published under terms that permit modification and redistribution. ‘Open source’ is a necessary but insufficient quality for Democratic AI. 
  • Governance rights are enforceable. People affected by a system can change how it operates. 

Decentralization also carries a resilience and security dividend that policymakers should weigh directly: infrastructure with no single point of control or failure reduces systemic risk and concentrated dependency. Advancing this standard should include interoperability, data and model portability, and open protocols, so that no single incumbent can capture the AI stack through lock-in. 

7. Shared Societal Benefit: Democratizing AI Should Extend to Democratizing Its Gains 

AI-driven labor disruption calls for near-term investment in reskilling and a modernized safety net, tracking impact as it happens rather than after the fact. 

TDC believes that economic gains of AI should be widely distributed through consultation with civil society and affected populations. Workers and communities displaced by AI infrastructure should have a meaningful path to share the benefits of that infrastructure, rather than simply support for the disruption it causes.  

Democratizing AI should extend beyond its oversight to who benefits from the tech, which should itself be decided democratically. Concretely, this can be delivered through verifiable on-chain attribution and micropayments to the people who contribute data, compute, and storage, and through participation in the networks those contributions help run. Such mechanisms distribute gains by design rather than only redistributing them after the fact (see Principle 12). 

8. Verifiable AI: Cryptographic Proof Should Be a Recognized Path to Compliance 

Compliance should be something a regulator can check, rather than something a developer asserts. 

Audits, disclosures, and self-certification all ultimately ask the public to trust the party being regulated. TDC supports recognizing cryptographic verification, meaning proof of what model ran, on what data, and with what result, established through methods such as verifiable inference, provenance attestation, trusted execution environments, and zero-knowledge proofs, as a valid and, where available, preferred means of demonstrating compliance. A standard built on “verify, don’t just trust” lets oversight keep pace with systems too numerous and fast-moving to certify one at a time. 

9. Neutral Infrastructure: Content-Neutral Providers Should Have a Clear Safe Harbor 

Providing the pipes should not mean answering for the water. 

The compute, storage, data-availability, and validation networks that AI runs on are typically content-neutral: they do not choose, train, or control the models they carry. TDC supports a clear safe harbor establishing that operating such infrastructure does not, by itself, make a party a developer or deployer, absent known participation in a specific harm. Without this, the decentralized and distributed infrastructure that makes open AI possible cannot operate at scale in the United States. 

10. Digital Assets: Network-Incentive Tokens Deserve Regulatory Clarity 

Decentralized AI cannot run on infrastructure that has no lawful way to reward its participants. 

Decentralized networks coordinate and compensate their compute providers, storage providers, validators, and other contributors through functional tokens. TDC supports clear federal treatment confirming that tokens used to coordinate infrastructure and reward genuine network participation are not, by default, treated as securities, along with workable clarity for staking and other consensus mechanisms. Resolving this question, now under active debate in digital-asset market-structure legislation, is a precondition for a domestic decentralized-AI industry rather than a matter separate from AI policy. 

11. Open Models: Releasing Open-Weight AI Should Be Presumptively Protected 

Openness is both a safe and competitive strategy. 

Open-weight and open-source models let independent researchers inspect, test, and improve systems that would otherwise be opaque. TDC supports treating the release of open-weight models as presumptively protected, so that a developer is not automatically liable for every downstream use of an openly released model and we are cautious about blanket reporting or restriction regimes aimed at open release. Where safety concerns arise, verifiability (Principle 8) is the better answer than closure: open and verifiable is more accountable than closed and unexamined. 

12. Data Provenance: Contributors Should Be Traceable and Compensable 

If data is the raw material of AI, its providers should be visible in the record and able to share in the value. 

Verifiable data pipelines make it possible to record what data trained a model and to trace contributions back to their source. TDC supports on-chain, privacy-respecting data provenance together with mechanisms for attribution and compensation, including micropayments, to the creators and communities whose data trains AI systems. This advances content authenticity and consent while giving the shared-benefit commitment in Principle 7 a concrete mechanism. 

13. Agentic AI: Autonomous Agents Need Identity, Accountability, and Payment Rails by Design 

As agents begin to act and transact on their own, the accountability layer should be built in up front. 

Autonomous agents increasingly initiate actions and transactions with limited real-time human involvement. TDC supports requiring that agents carry verifiable, portable identity, maintain tamper-evident logs of their actions, and remain attributable to a responsible human or entity, with any agent-to-agent transaction rails designed so that accountability is verifiable rather than reconstructed after harm. Building these guarantees into the infrastructure is the most reliable way to keep an emerging agentic economy answerable to the people it affects. 

If you have any questions, please reach out to policy@digitalchamber.org.  

TDC Submits Response to HFSC Democrats’ Request for Information on AI  

by Mary Grace Cooney

By: Jean-Phillippe Beaudet

On August 14, The Digital Chamber submitted a response to House Financial Services Committee Democrats’ Request for Information on artificial intelligence in financial services and housing. The AI + Quantum Working Group answered more than 30 of the Committee’s questions on explainability, liability, third-party risk, capital markets, housing, data centers, and international development. 

Read our full response HERE. 

TDC’s response makes three arguments: 

First, existing law already covers most of what worries people about AI in finance. The Equal Credit Opportunity Act, the Fair Housing Act, the Fair Credit Reporting Act, and Dodd-Frank’s UDAAP provisions don’t carve out an exception for a decision a model made instead of a person. Congress’s first job is reviving and enforcing the rules already on the books, rather than building a parallel AI-specific regime. 

Second, compliance claims should be provable, rather than asserted by private companies. Tamper-evident action logs, cryptographic attestations, and verifiable model and data provenance records let a regulator or a court confirm which system acted, on what data, and whether the record was altered afterward. None of that replaces governance, testing, or supervision, but it strengthens self-certification with an authoritative audit trail. 

Third, liability should follow function and control, rather than a party’s position in the supply chain. A developer that sets a model’s behavior, and that a deployer can neither inspect nor alter, should answer to the consumer. We also asked Congress for the reverse protection: a safe harbor for content-neutral infrastructure. Compute, storage, and validation networks that carry AI without selecting or training the models running on them shouldn’t be treated as developers or deployers simply for existing, and that protection should apply whether the infrastructure is centralized or distributed. 

Data Centers, Front and Center 

We also weighed in on AI data centers. We asked the Federal Energy Regulatory Commission to assign the transmission and generation costs a large load causes to that load, instead of spreading them across every customer in the region. We asked Congress to give the Energy Information Administration authority to collect mandatory facility-level reporting on power and water use, because fragmentary data reporting obligations leave communities without the information they need to make informed decisions. And we pointed the Committee to decentralized AI architectures, workloads distributed across many smaller machines instead of concentrated in one location, as a way to ease grid pressure and democratize the AI stack. 

Committee Democrats will fold this response into future hearings and legislation on AI in financial services and housing. TDC’s position gives them a path that doesn’t force a choice between protecting consumers and letting the industry keep building: rules that already exist, evidence a regulator can check, and liability that lands on whoever actually controls the outcome. 

Read TDC’s full library of comment letters and reports at www.digitalchamber.org. Questions can be sent to policy@digitalchamber.org.

The Digital Chamber Launches Compute Working Group 

by Mary Grace Cooney

New Digital Power Network initiative will bring industry expertise to federal policy discussions on compute markets and infrastructure. 

WASHINGTON, D.C. — September 24, 2026 — The Digital Chamber (TDC), through its Digital Power Network (DPN), today announced the launch of a ComputeWorking Group to help shape policies affecting the supply, financing, and use of computing capacity. 

The group will bring together companies that build, power, finance, buy, sell, and operate compute capacity, connecting industry expertise directly with federal policy discussions around artificial intelligence, high-performance computing, energy, and data center infrastructure. 

The initiative builds on DPN’s leadership in Bitcoin mining and the deep operational experience its members have developed across energy-intensive digital infrastructure. As demand for compute accelerates, many of the same challenges around power, infrastructure, capital, and market design are increasingly converging. 

“Compute is quickly becoming one of the most valuable resources in the American economy, and the markets that finance and allocate it are still being built,” said Cody Carbone, CEO of The Digital Chamber. “Our members have spent years navigating complex challenges around power, capital, and infrastructure at scale. Our Compute Working Group brings that experience to Washington, so policymakers can get these markets right from the start and keep America at the forefront of the compute economy.” 

The group’s first project will inform TDC’s response to the Commodity Futures Trading Commission’s request for comment on compute derivatives, including computefutures. Participants will help explain how compute markets operate and assess how emerging financial products could support price discovery, manage risk, and facilitateinvestment. 

“Compute policy is already taking shape across financial markets, energy, and infrastructure,” said Zunera Mazhar, VP of Policy and Government Affairs at The Digital Chamber. “We’re focused on bringing the industry’s operational experience to these conversations, starting with derivatives and extending to the energy, infrastructure, procurement, and market standards that will shape how compute markets develop. This work gives policymakers practical insight into how these markets function and what is needed to support investment, innovation, and growth.” 

The working group will also explore:  

  • Compute markets and financial innovation: Policies that support transparent, liquid compute markets, including emerging derivatives, financing tools, and risk management products. 
  • Energy and infrastructure: Power availability, grid interconnection, data center development, and other infrastructure constraints affecting compute growth. 
  • Procurement and market access: Opportunities and barriers for companies seeking to provide compute capacity and services to the federal government. 
  • Standards and market integrity: Frameworks for measuring, verifying, and delivering compute services, including interoperability, performance standards, and emerging distributed compute models.  
  • Through this work, participating companies will help translate operational experience into recommendations for policymakers, bringing the perspectives of infrastructure developers, suppliers, and customers into decisions affecting the compute economy. 

About The Digital Chamber 

The Digital Chamber is a non-profit organization committed to promoting global blockchain adoption. We envision a fair and inclusive digital and financial ecosystem where everyone has the opportunity to participate. Access to digital assets is not merely a technological advancement but a fundamental human right, crucial for economic and social empowerment. Through targeted education, advocacy, and strategic collaborations with government and industry stakeholders, we drive innovation and shape policies that create a favorable environment for the blockchain technology ecosystem. 

The Digital Chamber’s umbrella includes: CryptoUK, Digital Power Network (DPN), TDC’s Digital State Network, and Treasury Council. 

Media Contact: Mary Grace Cooney, Mary_grace@digitalchamber.org; press@digitalchamber.org

From Policy Ask to Policy Win: FinCEN Recognizes Digital Identity for Customer Verification

by Mary Grace Cooney

The Financial Crimes Enforcement Network (FinCEN) and the federal banking agencies have issued new guidance confirming that banks and credit unions may use government-issued verifiable digital credentials—including state-issued mobile driver’s licenses—to verify customers under the Customer Identification Program Rule.

This is an important modernization of federal financial-crime compliance and a direct response to a regulatory clarification The Digital Chamber has repeatedly requested.

Why This Guidance Was Needed

Financial institutions increasingly serve customers through mobile applications and other digital channels, but identity-verification practices often remain rooted in physical documents. Customers may be asked to photograph and upload a driver’s license, transmit sensitive personal information, or rely on authentication methods that are vulnerable to forgery and identity theft.

Mobile driver’s licenses and other verifiable digital credentials offer a more secure alternative. They use cryptographic signatures, device binding, authentication factors, and other safeguards to help institutions determine whether a credential is authentic and belongs to the person presenting it.

Until now, however, regulatory uncertainty limited adoption. Financial institutions needed clear confirmation that these credentials could be used consistently with existing Bank Secrecy Act and Customer Identification Program obligations.

From an Ask to a Win

TDC made that clarification a specific policy priority.

In our comments on Bank Secrecy Act modernization, permitted payment stablecoin issuer requirements, and NIST’s mobile driver’s license implementation guidance, TDC urged regulators to recognize privacy-preserving digital identity and verifiable credentials as legitimate compliance tools.

In May, we publicly called on FinCEN to issue clear guidance explaining how financial institutions could use mobile driver’s licenses and other digital credentials to satisfy BSA and Customer Identification Program requirements. FinCEN has now answered that request.

The new FAQs confirm that an unexpired government-issued verifiable digital credential can qualify as “government-issued identification” under the documentary verification provisions of the Customer Identification Program Rule, provided it contains the required information and the institution has the technology, policies, and procedures necessary to use it.

The guidance also confirms that these credentials may be used when customers open accounts in person, remotely over the internet, or through another digital or virtual channel. In addition, electronic credentials issued by nongovernmental entities may also be used as a non-documentary verification method when the institution ensures an appropriate level of authentication.

Why It Matters

This guidance gives regulated institutions greater confidence to adopt stronger identity technology without waiting for Congress or regulators to rewrite the underlying rule.

Properly implemented, verifiable digital credentials can:

  • Make forged or altered identity documents easier to detect
  • Strengthen remote customer onboarding
  • Reduce dependence on easily copied physical documents
  • Prevent new fraud tactics made widely available by AI
  • Limit unnecessary collection and storage of sensitive information
  • Improve the customer experience while supporting effective compliance

The FAQs do not require institutions to accept digital credentials or create new supervisory expectations. Institutions must still form a reasonable belief that they know a customer’s true identity, address signs of fraud, and incorporate any credential into a compliant risk-based program.

That flexibility is a strength. It allows financial institutions to adopt better tools while preserving responsibility for effective identity verification.

This is how sustained policy engagement produces results: identify a barrier, develop a workable recommendation, place it consistently before the right agencies, and secure clear federal guidance.

TDC thanks FinCEN and the federal banking agencies for recognizing that modern technology can advance compliance, cybersecurity, innovation, and consumer privacy at the same time.

Read the new FinCEN FAQs

Decoding Digital Assets: Empowering Policymakers with Tax Facts 

by Simi Awe

Digital assets are transforming the global economy at lightning speed. Regulators and lawmakers are actively trying to understand these mechanics to establish tax rules of the road, most recently in market structure legislation awaiting the U.S. Senate’s consideration.  

To secure U.S. leadership in digital assets for generations to come, we must address the burdensome nature of the current tax code on companies and consumers, and find a path to tax parity with traditional assets. We must resolve technical ambiguities regarding the timing and sourcing of staking rewards and push back against disproportionate compliance burdens like reward bifurcation.  

Finally, we will ensure that new rules, such as de minimis exceptions, thoughtfully address real-world administrability concerns. By tackling these issues head-on during the upcoming markup and beyond, we will foster domestic capital formation and build a tax code that supports industry growth. 

Advancing Tax Clarity

TDC has worked with the House Ways and Means Committee throughout the current legislative effort to help understand the technology and what kind of tax framework makes sense for consumers and the industry. 

  • In May, we outlined key pillars for a digital asset tax framework in a letter to the committee and reinforced those priorities in a formal statement for the record for June’s hearing. We have also shared technical analysis with legislators on the digital asset taxation legislative package. 
  • Direct Advocacy: Beyond formal submissions, we met directly with the vast majority of Ways and Means offices to advocate for comprehensive, bipartisan solutions conducting over 70 meetings that span more than 50 hours of direct engagement. 
  • Educational Roundtables: We have hosted 7 educational roundtables as part of our ongoing series, providing staffers with the insights needed to navigate this evolving landscape and creating a safe space for deeper questions about the causes and effects of the current U.S. tax structure. 
  • Bicameral Focus: Alongside these House engagements, our advocacy and education efforts in the Senate remain highly active. 

Whether through one-on-one briefings, educational roundtables, or technical documents on high-impact issues like staking, TDC provides lawmakers with an open line to industry experts so they can understand the technology they regulate. Our commitment and engagement ensures that every policy maker can make sound decisions for their constituents and the industry. 

What’s Next  

With the House Ways and Means Committee expected to mark up a digital asset tax package this September, we must maintain engagement to replace ambiguity with statutory certainty to boost tax compliance, protect retail investors, and secure U.S. leadership. 

TDC Response: FDIC’s Requirements for Stablecoin Issuers

by Neil Humphrey

The FDIC has the opportunity to create a strong framework for payment stablecoins, as long as the agency’s rules remain faithful to the language and intent of the GENIUS Act. Our core message in The Digital Chamber’s cautionary feedback to the FDIC is simple: do not add requirements Congress did not include, create inconsistent standards across regulators, or turn the stablecoin framework into a broader bank-style capital, deposit-allocation, or anti-innovation regime. You can read our full letter of recommendations HERE, but below are a few of the notable recommendations from our submission:  

A quick summary of several key points the FDIC should address: 

  1. The FDIC should harmonize its definitions and regulatory standards. 
  • The Office of the Comptroller of the Currency (OCC), Federal Reserve, and National Credit Union Administration (NCUA) should ensure that similarly situated issuers are not treated differently based solely on their primary regulator. 
  • Similarly, complex issues around tokenized deposits, deposit tokens, and the boundary between bank deposits and payment stablecoins must be addressed through harmonized rules and guidance across regulators, rather than resolved indirectly through this FDIC proposal. 
  1. We recommended changes to several definitions: 
  • The FDIC’s proposed definition of “insured depository institution” may be too narrow and could unintentionally exclude certain federally supervised banking institutions, including certain U.S. branches of foreign banks, from serving as reserve counterparties.  
  • Additionally, we recommended refining the definitions for “eligible financial institution,” “public distributed ledger,” “smart contract,” and “payment stablecoin holder.”  
  1. Expanding issuer obligations to downstream stablecoin holders with no direct relationship to the issuer did not make sense. As such, we emphasized that regulatory obligations should correlate with direct customer relationships, and that downstream users should be protected through disclosures, redemption rights, and reserve requirements. 
  1. We urged the FDIC to allow stablecoin issuers to engage in activities related to issuance, redemption, reserve management, custody, smart contract deployment, blockchain infrastructure, cross-chain functionality, and operational risk management. 
  1. Our response supported reserve identification, traceability, segregation, audits, and redemption protections that make sense.  
  • However, we noted that mandating a single legal structure, custody model, Simplified Payment Verification (SPV), or reserve management approach that does not align with that recommendation. This will give issuers flexibility to meet statutory requirements through different legally effective structures. 
  1. Finally, we noted that adding capital-like reserve buffers, standardized haircuts, automatic liquidation requirements, or rigid caps beyond the GENIUS Act was concerning. The statute already establishes a strict reserve framework, and additional requirements could reduce liquidity and limit competition. 
     

Overall, the strong supervision, full-reserve backing, redemption rights, transparency, and risk management in the NPRM all form a sensible implementation proposal aligned with Congressional intent. Our repeated stance in our response letter is that inconsistent treatment across agencies and requirements that would undermine the competitive and innovative framework Congress intended in passing the GENIUS Act should not be a part of the final version of the FDIC rules. 

Read our full response here.

One Year of the GENIUS Act  

by Neil Humphrey

One year ago, on July 18, 2025, President Trump signed the GENIUS Act into law, transforming how stablecoins (digital assets pegged to the U.S. dollar) are regulated in the U.S.  The law established a clear federal framework for stablecoins and became part of history as the first major piece of crypto legislation ever signed into law in the U.S.  

The GENIUS Act requires stablecoin issuers to maintain 1:1 reserves in safe assets such as U.S. dollars and short-term Treasuries, publish monthly reports, and comply with anti-money laundering rules. The trust that comes with knowing there is strong federal oversight for stablecoins has been a key unlock to the growth of the asset class. 

The Results 

When the rules became clear, people began building. Major companies took notice almost immediately; Visa, Mastercard, J.P. Morgan, and more integrated or announced stablecoin payment products following the law’s passage. 

  • The global stablecoin market has reached $315 billion in market capitalization in 2026, more than 50% growth from the $206 billion market cap at the beginning of 2025.  
  • Annual global transaction volume surged to nearly $35 trillion in 2025, a figure that rivals major credit card networks.  
  • Real-world stablecoin payments, including businesses paying suppliers, families sending money home, people buying goods, and more, have doubled in a single year to $390 billion. 

Beyond our Borders 

The ripple effect from Washington went global; regulators everywhere watched the U.S. draw clear lines and started drawing their own. 

Stablecoin adoption has been particularly transformative in Latin America. As detailed in Latin America’s Surge in the Global Race to Adopt Stablecoins, the region has become a global leader in stablecoin usage, driven by people seeking to protect their savings from inflation, send remittances cheaply, and access dollar-denominated accounts without a U.S. bank. This effectively turns the citizens in those countries into buyers of U.S. Treasuries and depositors into U.S. bank accounts. The GENIUS Act’s clear framework accelerated this by giving international users and issuers confidence that dollar-backed stablecoins were built on solid ground. 

  • Australia introduced stablecoin legislation in late 2025 and adopted it in April 2026, treating stablecoins as regulated payment products and requiring compliance with standard Australian Securities and Investments Commission (ASIC) regulations. 
  • The EU’s MiCA regulation paved the way for licensed euro-backed stablecoins; Decta’s 2025 report noting that monthly transaction volume rose 899% after MiCA’s rollout. 
  • The Asia-Pacific region is racing to be a hub for regulated digital finance, with frameworks such as Hong Kong’s Project Ensemble, South Korea’s Capital Markets and Electronic Securities Acts, Singapore’s Project Guardian, and more. 
  • Stablecoins now account for roughly 43% of all crypto transaction volume in Sub-Saharan Africa, where people use dollar-pegged digital assets to protect their savings from local-currency inflation. 
  • The Bank of England in the UK revised its pound sterling stablecoin proposal, eliminating a £200,000 limit on individual holders and raising the issuance cap to £40 billion.  

The Takeaway 

Clear rules don’t slow innovation down. They speed it up. Before the GENIUS Act, banks and institutions often wouldn’t touch stablecoins for fear that investments would be lost to shifting regulatory winds. And developers couldn’t build products if they didn’t know whether those products were legal. 

When the U.S. defined the rules of the road, the market responded, and that’s exactly why finishing the job with a market structure bill like the Clarity Act matters now. The GENIUS Act addressed the questions surrounding stablecoins, but the U.S. has yet to clearly define where Bitcoin, Ethereum, and thousands of other digital assets fit within our regulatory system.  

We are closer than ever to market structure rules of the road. The House passed a version of a market structure bill last year. The Senate Banking Committee advanced its portion of the bill in May 2026, just months after the Senate Agriculture Committee passed its portion of the bill. Negotiations are actively blending those bills, so the full Senate can continue pushing the bill towards the President’s desk. 

One year in, the lesson of the GENIUS Act is clear: America leads when it sets standards. The world follows when we do. Now is the time to build on that momentum and set the standard for market structure and asset control. Done right, the rule can support effective enforcement while giving responsible PPSIs the clarity they need to build in the United States. 

Stablecoin Rules Must Match How Stablecoins Actually Work 

by Neil Humphrey

The Digital Chamber submitted a comment letter to FinCEN and OFAC regarding their proposed rule on AML/CFT and sanctions compliance program requirements for permitted payment stablecoin issuers. 

Bringing permitted payment stablecoin issuers, or PPSIs, into a clear BSA/AML framework helps consumers feel confident, helps firms do their part to protect the U.S. financial system and support law enforcement. 

At the same time, TDC urged FinCEN and OFAC to clarify the final rule so it reflects how payment stablecoins actually operate. The key point is simple: issuing a payment stablecoin is not the same as intermediating every transaction in which that stablecoin is later used. 

Why It Matters 

Payment stablecoins can strengthen U.S. payments, expand access to dollar-denominated digital value, and support responsible innovation. The current proposed rules could create obligations that no issuer can realistically meet. 

TDC’s letter focuses on several core points: 

  • PPSIs should be responsible for their own direct activities, such as issuance, redemption, custody, hosted wallet services, or other customer-facing services. 
  • PPSIs should not be required to monitor, report on, or serve as the compliance intermediary for all secondary-market activity merely because they issued the stablecoin. 
  • Recordkeeping, Travel Rule, SAR, and sanctions obligations should apply to the entity with the customer relationship, transaction role, custody, control, or legal ability to act. 
  • Blockchain analytics, digital identity, ecosystem monitoring, and AI-enabled tools can improve compliance, but they should not create broad secondary-market surveillance duties for PPSIs. 
  • FinCEN and OFAC should provide clearer guidance on when PPSIs must block, freeze, reject, seize, burn, or otherwise prevent transfers. 
  • Regulators should account for downstream risks to innocent users when stablecoins are frozen, seized, or burned inside decentralized protocols, liquidity pools, automated market makers, or other shared on-chain systems. 

TDC’s Take 

TDC supports strong AML/CFT and sanctions compliance for stablecoin issuers. But compliance obligations must be tied to the role an issuer actually plays. 

When a PPSI directly issues or redeems stablecoins for a customer, it can collect information, screen wallets, use blockchain analytics, conduct due diligence, and maintain records. But once a stablecoin moves through exchanges, custodians, merchants, self-custodied wallets, decentralized protocols, or smart contracts, the issuer often does not know the sender or recipient, does not hold the customer’s assets, and does not control the transaction. 

That distinction matters when regulators require an issuer to freeze, seize, burn, or restrict stablecoins. In a custodial setting, that action may affect a specific account or wallet. In a decentralized liquidity pool or automated market maker, the same action could disrupt pricing, liquidity, collateral, or protocol operations for users with no connection to the enforcement target. 

TDC also urged FinCEN and OFAC to provide safe harbors or mitigating-factor treatment for PPSIs that act in good faith to comply with lawful orders while taking reasonable steps to limit harm to innocent users, liquidity providers, protocol participants, and other third parties. 

Taken together, these stablecoin compliance recommendations will create rules that are both strong and workable. 

What’s Next 

TDC will continue working with regulators and industry to ensure the final rule aligns realistic compliance obligations with customer relationships and asset control. Done right, the rule can support effective enforcement while giving responsible PPSIs the clarity they need to build in the United States. 

TDC CEO Testifies at Senate Banking Hearing Entitled: The Affordability Agenda

by Simi Awe

Cody Carbone
Chief Executive Officer, The Digital Chamber
U.S. Senate Committee on Banking, Housing, and Urban Affairs
Hearing Entitled: “The Affordability Agenda”
Tuesday, June 23, 2026


Chairman Scott, Ranking Member Warren, and members of the Committee, thank you for the opportunity to testify today.

My name is Cody Carbone, and I serve as Chief Executive Officer of The Digital Chamber, the world’s largest digital asset and blockchain trade association. Founded in 2014, our members include more than 250 companies globally across the digital asset and blockchain ecosystem, including exchanges, custodians, infrastructure providers, banks, developers, investors, and emerging technology companies working to build a safer, more competitive, and more inclusive financial system.

I am here today to offer solutions to the challenge of affordability weighing on Americans. The cost of accessing, moving, saving, and investing money should not be a barrier to any of these basic economic activities. The goal of the digital asset industry is to make it as easy to send money as it is to send an email.

For too long, American consumers and small businesses have been forced to operate on financial rails that are slow, expensive, and often difficult to access. These costs rarely appear as a single line item on a receipt, but they show up everywhere: in the price of groceries, in fees charged to small businesses, in the cost of sending money to family abroad, in the delay between earning a paycheck and being able to use it, and in the thousands of dollars families
must pay to close on a home.

That is the hidden affordability problem digital assets can help solve.

Digital assets and blockchain technology will not, on their own, slow inflation, increase the housing supply or wages, or fix every cost pressure facing Americans. But they can reduce the impact of friction and fees and offer competitive alternatives across the global financial system.

This matters most for households with the least room for error. The Federal Reserve reported in May 2026 that only 63 percent of adults could cover a hypothetical $400 emergency expense using cash, savings, or the equivalent – meaning more than one-third could not do so without borrowing, selling something, or being unable to cover the expense at all. 1The same survey found that 59 percent of adults had at least one major unexpected expense in the prior 12 months, with major vehicle repairs, home or appliance repairs, and major medical expenses among the most common.2

The FDIC’s most recent national household survey found that 4.2 percent of U.S. households – approximately 5.6 million households – were unbanked in 2023, while another 14.2 percent – approximately 19 million households – were underbanked.3 These are the Americans most likely to rely on costly, high-interest stopgap measures such as check cashing, money orders, payday loans, pawn shops, and other nonbank financial services.

Even for banked consumers, delays and fees are real and costly. Consumers paid more than $5.8 billion in overdraft and nonsufficient-fund fees in 2023, even after many institutions reduced those charges from pre-pandemic levels.4 And under Regulation CC, funds from many local checks generally do not have to be made fully available until the second business day after deposit, with only the first $275 generally required to be available by the first business day.5 For a household living paycheck to paycheck, that delay is not an inconvenience. It is a cost.

Digital assets can help lower costs in three areas to directly address the challenge of affordability: cross-border payments, everyday merchant payments, and the transfer and ownership of assets.

First, digital assets can reduce the cost of cross-border money transfers.

The United States is the largest source of remittances in the world. The International Organization for Migration has reported that the United States has consistently been the top remittance-sending country, and World Bank bilateral estimates have placed U.S. outward remittance flows at approximately $200 billion in a recent year.

6Globally, remittances to lowand middle-income countries were estimated to reach $685 billion in 2024 and were forecast by
the World Bank to reach approximately $690 billion in 2025.7

The World Bank’s Remittance Prices Worldwide database reported that the global average cost of sending remittances was 6.36 percent in its latest available report, more than double the international target of 3 percent.8 At that price, a worker sending $200 home may lose more than $12 to fees before the money even reaches the intended recipient. Across hundreds of billions of dollars in global remittances, those fees represent a significant economic loss for working families.

The problem is that cross-border payments often depend on multiple parties, different systems, different time zones, currency conversion, compliance checks, and settlement processes that were not designed for the modern digital economy. GENIUS Act regulated US dollar-backed stablecoins can help reduce that friction.

A payment stablecoin can move value globally, around the clock, over blockchain-based infrastructure. While on-ramps, off-ramps, foreign exchange, compliance, custody, and wallet services may still involve costs, the underlying payment rail tends to be faster, more
transparent, and more efficient than many legacy cross-border systems.

The same problem affects American freelancers, contractors, and small businesses. For example, a designer in South Carolina working for a client in Europe, a software developer in Arizona paid by a company in Asia, or a manufacturer in Ohio paying an overseas supplier all face the same basic problem: global payments are slow and expensive, creating a burden on those working to innovate and grow much-needed jobs in their communities.

That is why business-to-business payments have become a fast-growing real-world use case for stablecoins. McKinsey estimated in February 2026 that B2B stablecoin payments accounted for roughly $226 billion, or about 60 percent of global stablecoin payment volume, and that B2B stablecoin payments had increased 733 percent year over year.9 Artemis, Castle Island Ventures, and Dragonfly similarly found significant growth in stablecoin payment activity, including B2B use cases such as treasury operations and cross-border settlement.10

Businesses are using these tools because the payment rails are secure and fast. Lower-cost cross-border payments make American workers and American businesses more competitive, and all American consumers deserve access to these innovations.


Second, digital assets can put competitive pressure on the cost of everyday payments.


Federal Reserve data show how central card payments have become to everyday commerce. In 2024, credit cards accounted for 35 percent of consumer payments by number, and debit cards accounted for another 30 percent. Cash accounted for 14 percent.11

The cost of accepting card payments is material. In a 2025 report, the Government Accountability Office found that selected federal entities collected approximately $43.6 billion from consumers using credit, debit, and other payment cards in fiscal year 2023 and paid approximately $784 million in related fees. Those fees equaled 1.8 percent of revenue, and interchange fees accounted for nearly 90 percent of the fees paid by those entities.12

Federal Reserve data also show that payment network fees are significant. In 2023, network fees to all parties in debit card transactions increased to $12.95 billion, and acquirers and merchants paid 64.9 percent of those network fees.13

For large businesses, payment acceptance costs are a major operating expense. For small businesses operating on thin margins, they can be especially difficult to absorb. And because payment costs are part of doing business, they can affect prices, margins, wages, investment, and consumer choice.

Blockchain-based payment rails can introduce another option.

A regulated dollar-backed stablecoin can settle faster and often at lower cost than many traditional payment methods. Stripe, for example, lists stablecoin payment acceptance at 1.5 percent of the transaction amount in U.S. dollars, including conversion to fiat, wallet and AML screening, fraud prevention, and gas sponsorship.14 Stripe has also stated that stablecoin transfers typically incur flat network fees, often measured in pennies, and that for certain
businesses, stablecoin payments can cost about half as much as other payment methods.15

Properly regulated dollar-backed stablecoins can allow certain payments to settle faster, with greater transparency, and with a different cost structure than legacy payment systems. They should not replace cards, cash, ACH, wire transfers, or other payment methods. Different payment methods serve different needs, and consumers should be empowered with the best choices possible for their individual needs and preferences.

A cheaper, faster, compliant payment rail can give merchants more choices. It can allow businesses to experiment with lower-cost payment options. It can create pressure for incumbent payment systems to improve. And over time, greater competition in payments can benefit consumers.

It is also consistent with the way American markets work best. When a new rail can move the same dollar more efficiently, the answer should not be to block it. The answer should be to regulate it properly, supervise it effectively, and allow responsible market participants to compete.

That competition matters for small businesses. A family-owned restaurant, a local grocery store, a contractor, a barber shop, or an online seller may not have the bargaining power of a national retailer. Safer, more compliant, lower-cost options position businesses better to compete, invest, hire, and serve their customers.

Consumers benefit when payment systems compete, especially when innovation happens under U.S. rules, rather than in offshore markets where American regulators have less visibility to protect consumers.

Because of this Committee’s leadership, Congress has already taken a major step. The GENIUS Act created a federal framework for payment stablecoins, including requirements for reserve backing, public reserve disclosures, supervision, and compliance. That framework can help give consumers, businesses, banks, and regulators greater confidence that payment stablecoins are backed, redeemable, supervised, and compliant.16

Third, digital assets can reduce barriers to owning and transferring assets.

Tokenization is the process of representing ownership, rights, or claims on a blockchain. That can include financial assets, such as funds, bonds, Treasuries, private credit, collateral, and commodities. But it can also include real estate interests, invoices, receivables, warehouse receipts, supply chain records, intellectual property royalties, energy credits, and other records of ownership or entitlement.

That matters because today, too many markets still rely on fragmented, paper records and duplicative processes. One system records ownership. Another verifies documents. Another sends payment instructions. Another clears the transaction. Another settles it. Another reconciles the records after the fact.


Tokenization can help reduce that friction by allowing ownership records, transfer instructions, payment, settlement, and verification to operate through a shared digital infrastructure. That can mean clearer records, faster settlement, stronger auditability, fewer duplicative checks, and lower administrative costs.

This matters across the economy.

For funds and securities, tokenization can make issuance, subscriptions, redemptions, transfer agency functions, and investor recordkeeping more efficient.

For Treasuries and collateral, it can help assets move more efficiently through the financial rules and regulations that support the markets Americans rely on every day.

For small businesses, tokenized invoices and receivables can help verify payment rights, improve recordkeeping, and unlock working capital faster.

For supply chains, tokenized warehouse receipts and inventory records improve transparency and accuracy about who owns what, where it is, and when it changed hands.

And for real estate, tokenization can help modernize one of the most expensive and paperheavy transactions most Americans will ever experience.

When a family buys a home, thousands of dollars can be consumed by the process of transferring ownership, verifying title, moving funds, recording documents, and closing the transaction. Closing costs often range from 2 to 5 percent of the purchase price, not including the down payment.17

On a $350,000 home, which is currently lower than the median U.S. average price, that can mean $7,000 to $17,500 before a family receives the keys.

While those costs pay for important protections, it should concern everyone on this Committee that the largest financial transaction most Americans will ever make still depends on a process that can be fragmented, paper-heavy, duplicative, and expensive.

Homeownership is already hard enough, especially for first-time buyers. Fannie Mae has found that closing costs are a meaningful obstacle for first-time and low-income homebuyers. In an analysis of approximately 1.1 million home purchase loans acquired in 2020, Fannie Mae found that more than 14 percent of low-income first-time homebuyers had closing costs equal to or exceeding their down payment.18

Modernizing record-keeping, including proof of ownership, transferring value, and settling transactions, are a few ways to make life easier for our neighbors through transparency, reducing duplicative verification, improving auditability, and expanding efficient pathways for transferring interests in assets, rights, and records.

Beyond lowering costs, tokenization can be a key to unlocking access to ownership by reducing the cost of entry for large-scale investments.

Fractional ownership, when properly regulated, can allow participation in smaller increments while preserving investor protections, disclosures, custody standards, suitability requirements, transfer restrictions, and market integrity rules.

That expands wealth-building opportunities beyond those with existing wealth. Though not yet operating at a national scale, the potential is easy to see in the efforts made so far to tokenize and offer small shares for investors to buy and hold.
Major financial institutions, asset managers, technology companies, and market participants are already building toward a more efficient model for issuing, owning, transferring, and administering assets, rights, and records. Citi Institute projected in June 2026 that the global tokenized asset market could grow from approximately $17 billion today to $5.5 trillion by 2030.19 McKinsey has estimated that tokenized market capitalization could reach approximately $2 trillion by 2030, excluding cryptocurrencies and stablecoins.20

Those projections are not a guarantee. They show where markets are moving. A critical question that only Congress can answer is whether that activity will happen under U.S. rules, with U.S. regulators serving U.S. consumers and businesses, or whether it will move offshore.

Regulators are now implementing the GENIUS Act through rules governing issuer supervision, reserve standards, custodial and safekeeping requirements, Bank Secrecy Act obligations, sanctions compliance, and customer identification requirements.21

The GENIUS Act was a major bipartisan accomplishment. It showed that Congress can create clear rules for digital assets that support innovation, protect consumers, and give regulators the tools they need.

And we recognize the heavy lifting this committee has continued to do to ensure consumers, innovators, and regulators can build onshore with confidence.

On May 14, 2026, this Committee advanced the Digital Asset Market Clarity Act by a bipartisan vote of 15 to 9.22 That vote matters because market structure is the foundation for responsible digital asset innovation, and because digital asset regulation should not be partisan.

A clear market structure framework will define who the primary regulator is for what kind of token, what disclosures are required, how intermediaries must operate, how customer assets are protected, and how illicit activity is policed.

This matters for affordability because uncertainty carries a real cost. Muddy, antiquated regulations push responsible companies to divert resources from product development to legal and compliance, and cause banks and regulated financial institutions to hesitate to engage in emerging and more efficient products. Consumers are left with fewer regulated options, and regulators are forced to oversee a market without clear statutory tools.

The better approach is clear, durable law: a framework that defines regulatory authority, and gives innovators commonsense rules and obligations to ensure consumers can confidently participate in the market and have long-term protections.

Digital assets are not a silver bullet for affordability, but they are a practical tool for reducing financial friction.

Digital assets can help lower those costs, but only if Congress provides the clarity needed to build responsibly.

The Digital Chamber and our members are committed to supporting fair, responsible regulation. We support strong consumer protections with clear rules for market participants and innovators. Such a framework encourages and supports innovation in the United States.

If you have any questions, please reach out to press@digitalchamber.org.

Latin America’s Surge in the Global Race to Adopt Stablecoins

by Neil Humphrey

The GENIUS Act established the first federal framework for stablecoin issuance in the U.S. in July 2025. In the year since, stablecoin transfer volume has reached roughly $4.5T in Q1 2026. Latin American countries are seeing that success and are working to establish regulations that will likely fuel more crypto adoption in traditional finance in the region. Notably: 

  • Brazil was among the first Latin American countries to adopt such regulations through its “Virtual Assets Law.”  
  • Bolivia reversed its decade-long crypto ban in June 2024. 
  • Argentina introduced mandatory exchange registration in 2025, and many more frameworks are being developed in these markets.  

As adoption and regulation of stablecoins have pushed Latin America’s crypto market into more commercial use cases, 71% of Latin American institutions have already begun using stablecoins for cross-border payments, the highest regional adoption rate globally. Additionally, on-chain crypto volume in the region rose 60% year-over-year in 2025, driven largely by stablecoins.  

While the drivers of adoption differ, the common effect is that in 2025, there was $324 billion in stablecoin transaction volume across LATAM, representing an 89% year-over-year surge. In Brazil, currently over 90% of all crypto flows are stablecoin-related, and over 60% in Argentina. Hotels, restaurants, and tourism businesses are also beginning to accept stablecoin payments directly from international visitors, saving both businesses and tourists millions previously lost to exchange rates and credit card fees. 

Business-to-business (B2B) stablecoin volumes grew 30x globally in the past two years, and Latin American businesses, banks, and fintechs have been among the first to widely adopt stablecoins.  

  • Mizuho research reports that remittance fees via stablecoins in the US-Mexico corridor are now under 1%, a major improvement for consumers compared to the 5% to 7% average fees charged by traditional money transfer services.  
  • Across the $142 billion that U.S. individuals sent to Latin America in 2025, if conducted through low-cost stablecoin infrastructure, this could result in $6.1-8.9 billion in consumer savings. 

As regulations become clearer and adoption continues to grow, stablecoins are likely to play an increasingly important role in payments, savings, and cross-border transfers throughout Latin America.