U.S. Treasury Seeks Public Input on Crypto Crime Detection Tools

The U.S. Treasury Department opened a formal request for public comment on August 18, asking for “innovative methods to detect illicit activity involving digital assets.” The request fulfills a requirement in the GENIUS stablecoin law that President Donald Trump signed on July 18, 2025. Comments are due October 17, 2025.

Treasury published the notice in the Federal Register and is collecting responses through Regulations.gov. The department wants input from financial institutions, technology companies, and the public on how to use application programming interfaces, artificial intelligence, digital identity verification, and blockchain monitoring to identify money laundering and other illegal financial activities involving cryptocurrencies.

The GENIUS Act created a federal framework for payment stablecoin issuers. Under the law, these companies must follow Bank Secrecy Act rules, maintain fully backed reserves, and meet detailed redemption and oversight standards. 

Treasury Secretary Scott Bessent recently posted on X that “stablecoins will expand dollar access for billions.” The consultation period runs until October 17, 2025, with Treasury planning to provide recommendations to Congress afterward.

Treasury will evaluate the submissions based on several factors: how well they spot illegal activity, costs for regulated companies, privacy risks, operational challenges, and cybersecurity risks. After studying the responses, Treasury will deliver a report with potential legislative and regulatory proposals to the Senate Banking Committee and House Financial Services Committee. The department may then issue guidance or start new rulemaking based on the research.

Banking trade groups recently urged Congress to fix parts of the GENIUS Act. They warned that restrictions preventing stablecoin issuers from paying interest could be bypassed by exchanges or affiliates offering yield products, which might affect traditional deposit markets.

Under the GENIUS framework, permitted stablecoin issuers are treated as financial institutions for Bank Secrecy Act purposes. They must follow sanctions, anti-money laundering, and customer identification rules. The law sets audit requirements and oversight parameters for these companies.