Two prominent crypto industry groups are pressing the U.S. Treasury to soften anti-money laundering requirements in the GENIUS Act, arguing the current rules would crush stablecoin issuers under red tape. Hyperliquid Policy Center and Paradigm jointly called for revisions, saying the compliance burden goes far beyond what smaller firms can handle.
Why the rules are drawing fire
The Treasury's money laundering provisions under the GENIUS Act, designed to tighten oversight of digital assets, have sparked pushback from companies that issue stablecoins — tokens pegged to fiat currency. Hyperliquid and Paradigm contend that the rules demand extensive reporting, customer verification, and transaction monitoring that would be particularly punishing for startups and mid-sized operators. The groups did not specify which sections of the law they want changed, but they described the existing framework as 'too onerous' for the stablecoin sector to function effectively.
Stablecoin issuers at the center
Stablecoins have become a key piece of crypto infrastructure, used for trading, lending, and payments. Their issuers must already comply with state-level money transmitter licenses and federal anti-money laundering rules. The GENIUS Act would layer on additional federal requirements, including real-time transaction screening and mandatory reporting of suspicious activity within hours. Hyperliquid Policy Center and Paradigm argue that this would force many issuers to either shut down or move offshore, weakening U.S. influence over the market.
Who's behind the call
Hyperliquid Policy Center is a research and advocacy group focused on crypto regulation. Paradigm is a major venture capital firm that backs blockchain projects. Together, they represent a significant portion of the industry's policy voice. Their joint statement did not offer alternative language, but urged the Treasury to engage in a 'meaningful dialogue' with issuers before finalizing the rules.
What comes next
The Treasury has not yet responded to the request. The GENIUS Act is still making its way through the legislative process, with hearings expected later this year. The rulemaking timeline remains unclear, but stablecoin companies are watching closely — their operational future may hinge on whether the agency decides to revise the language.
