- The NCA wants transition periods allowing existing stablecoin holders to redeem, sell, or convert tokens when regulatory restrictions take effect.
- The association urges clear rules enabling stolen stablecoins to be recovered and returned to victims under lawful orders.
- The NCA calls for protections for self-custody and peer-to-peer transfers, citing consumer demand for greater transparency and regulatory clarity.
The National Cryptocurrency Association (NCA) has urged the U.S. Treasury to protect stablecoin holders as it develops regulations under the GENIUS Act. In its comments, the nonprofit called for transition periods when stablecoin legal status changes, clear routes for recovering stolen funds, and protections for self-custody and peer-to-peer transfers.
NCA Seeks Transition Periods for Stablecoin Holders
The NCA said existing holders should retain time to redeem, sell, or convert stablecoins when regulatory changes restrict their availability. Its recommendations address the Act’s effective date, temporary waivers, state certification decisions, and the July 18, 2028, offer-and-sale deadline.
The association warned that holders could lose access if platforms stop supporting a stablecoin when a prohibition takes effect. It urged the Treasury to establish time-limited transition windows before restrictions begin, including when waivers expire or state certifications face denial or lapse.
During these periods, platforms should support transactions by existing holders without allowing new purchases. The NCA also asked the Treasury to clarify that redemptions, conversions, required notices, custody, and technical support would not automatically violate restrictions.
Stolen Funds and Lawful Orders
The NCA also addressed recovery of stolen stablecoins through lawful orders. Treasury’s proposal excludes transfers required by lawful orders from its definition of issuance and allows issuers to reissue stablecoins to comply with such orders.
The association wants the rules to leave no doubt that stolen funds can be recovered and returned to victims under lawful authority. Its submission focused on consumer protections rather than the technical details of issuer compliance.
Self-Custody and Consumer Trust
The NCA urged Treasury to protect self-custody and peer-to-peer transfers while establishing clear regulatory boundaries. It cited research showing that more than 67 million Americans hold cryptocurrency, while 87% of crypto holders use it for activities beyond ownership.
According to the association, 41% send money to family, while 40% use crypto for shopping and payments. It also reported that 49% of surveyed holders wanted greater transparency from crypto companies, and 39% sought stronger government oversight and regulatory clarity.
Stuart Alderoty, president of the National Cryptocurrency Association, said Treasury’s rules must prevent Americans from being stranded with stablecoins after regulatory changes. He also called for pathways to recover stolen funds and preserve the option to self-custody.
