Woofun AI reports that a bipartisan group of senators, led by Cynthia Lummis, has formally requested that U.S. Treasury Secretary Scott Bessent preserve state-level regulatory authority over specific stablecoin issuers. This directive targets the implementation rules for the GENIUS Stablecoin Act, which was enacted last year to establish a federal framework requiring full backing by U.S. dollars or high-liquidity assets. While the legislation mandates annual audits for issuers exceeding $50 billion in market capitalization, it permits entities with valuations not exceeding $10 billion to operate under state regulation, provided their regimes are 'substantially similar' to federal standards.

The senators contend that previous Treasury proposals failed to define clear timelines and standards for certifying state regulatory frameworks, thereby generating significant uncertainty. Given that state legislative cycles vary widely, with some jurisdictions operating on biennial schedules, the letter advocates for a flexible, continuously open certification mechanism. This approach aims to allow states to apply for certification as needs arise, preventing timing mismatches from stifling innovation and competition within the stablecoin sector.