TL;DR:
- Consensys submitted comments to the FDIC warning that its regulatory proposal for the GENIUS Act could unduly extend to wallet software and DeFi.
- The firm identified four areas for refinement, including the yield prohibition, non-custodial interfaces, operational flexibility, and technical definitions.
- Gemini’s prediction market estimates a 70% probability that crypto market structure legislation will pass before 2027.
Blockchain firm Consensys submitted formal comments to the Federal Deposit Insurance Corporation (FDIC) in response to the regulatory proposal seeking to implement the GENIUS Act, the federal framework for payment stablecoins in the United States. The company warned that the agency’s interpretation could extend beyond stablecoin issuers and reach independent software providers, including wallets and decentralized finance applications.
The document submitted by Consensys complements two earlier submissions: one to the Office of the Comptroller of the Currency (OCC), dated May 1, and another addressed to the Treasury Department on state regulatory frameworks. The firm framed these three interventions as the beginning of a dialogue with federal banking regulators to refine the law’s implementation.
Consensys has filed a comment on the @FDICgov's GENIUS Act proposal, outlining four areas that need refinement.
This filing, alongside our OCC and Treasury comments, marks the start of a broader conversation with federal banking agencies on getting the GENIUS Act rules right.…
— Consensys.eth (@Consensys) May 19, 2026
Consensys: Four Points That Divide Software Regulation
Consensys identified four concrete areas requiring revision. First, it questioned the agency’s intent to extend the yield prohibition to “related third parties,” arguing that such an interpretation would interfere with standard commercial arrangements such as brand licensing and distribution contracts. Second, it defended the explicit exclusion of self-custody software enshrined in the GENIUS Act itself, requesting that the FDIC confirm that DeFi navigation interfaces do not act as regulated intermediaries on behalf of issuers.
The third observation aimed to preserve certain provisions of the proposal that offer greater flexibility than the OCC model, particularly regarding multi-brand issuance and discretionary management of reserves and redemptions. The fourth request was technical in nature: that the agency adopt functional definitions for smart contracts and distributed ledgers, and that it evaluate cross-chain stablecoins based on holder rights rather than solely on technical criteria.
The CLARITY Act Gains Momentum in Congress
Meanwhile, Gemini’s prediction market assigns a 70% probability to crypto market structure legislation being enacted before 2027. Just days ago, the CLARITY Act passed 15 to 9 in the Senate Banking Committee. Nevertheless, the probability of passage before June 2026 fell to 9%, and industry analysts warn that the bill will have to compete for legislative time with budget reconciliation measures and the Farm Bill, among others.
