NACS, along with the International Franchise Association (IFA) and National Retail Federation (NRF), submitted a letter this week in response to the Advance Notice of Proposed Rulemaking (ANPRM) that the Treasury Department issued to solicit comments on questions relating to the implementation of the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act. Specifically, the ANPRM seeks comments on potential regulations that Treasury may promulgate to implement the GENIUS Act, which regulates payment stablecoins.

The letter states:

“IFA, NACS and NRF support Congress’ and Treasury’s leadership and efforts in bringing regulatory clarity for payment stablecoins and sees the implementation of the GENIUS Act as a major step forward in ensuring oversight and stability over the digital asset ecosystem.

However, in respect of Section 4(a)(11) of the GENIUS Act—which prohibits permitted payment stablecoin issuers and foreign payment stablecoin issuers from paying any form of interest or yield to holders—IFA, NACS and NRF are concerned that an overly broad interpretation could inadvertently prohibit or restrict the offering of routine rewards, loyalty programs and other payment stablecoin incentives. Prohibiting or restricting such incentives would significantly hinder payment stablecoin adoption, limit competition and exacerbate the burden of rising card processing fees on franchisees, merchants of all types and ultimately consumers.”

NACS and its cosigners are also concerned that there should be no limitation on legitimate commercial incentives tied to the use of a payment rail by entities such as stablecoin exchanges, digital wallets, merchants or others in the stablecoin market.

“Once again, the credit card industry is trying to stop competition in payments, this time by artificially limiting stablecoins,” said Doug Kantor, NACS general counsel. “Banks and credit card companies shouldn’t have a monopoly on how people pay, and government regulation certainly shouldn’t promote a monopoly like that. We are counting on the Treasury Department to do the right thing and make sure stablecoins have the freedom to compete to make it easier and cheaper for people to pay for things.”