Circle has asked the U.S. Securities and Exchange Commission (SEC) to treat payment stablecoins that comply with the GENIUS Act as cash in certain securities-market settings. Its comment letter, submitted on October 20 and described on October 28, responds to the SEC’s proposed Regulation Crypto Assets. Circle supports the framework but wants clearer rules for using stablecoins to pay for and settle securities offerings.
The proposal would create two exemptions from securities registration: one for offerings of up to $5 million over four years, and another for up to $75 million within 12 months, subject to disclosure and other requirements. Circle wants qualifying dollar stablecoins that are redeemable one-for-one to count as cash consideration, with their value based on the corresponding dollar amount. It argues that payment over a blockchain should not trigger different procedures from a bank transfer, and that accepting a stablecoin should not automatically make its issuer subject to the securities obligations that apply to the offering. Circle also seeks appropriate accounting and customer-reserve treatment for qualifying tokens.
For broker-dealers’ capital calculations, current SEC staff guidance permits a 2% haircut on qualifying stablecoin positions. Circle proposes reducing it to zero, subject to objective safeguards. For example, the existing deduction would lower calculated net capital by $20 million on a $1 billion position. Circle also wants the SEC to clarify whether compliant stablecoins can be held in reserve accounts used to protect customer funds. These changes would require separate regulatory decisions, and the SEC has not approved Circle’s requests.
The filing also addresses the regulatory treatment of developers working on operational networks. Circle says that maintaining a known validator set after a network is functional should be considered technical work, rather than “critical managerial efforts,” and asks for a safe harbor for technical roadmaps. The company cites its Arc network in this context. Circle’s proposals are limited to stablecoins meeting the GENIUS Act’s requirements; whether the SEC will grant the requested treatment remains unresolved.