Circle Submits Comment Letter to the SEC on the Proposed Regulation Crypto Assets
On October 20, Circle submitted a comment letter to the U.S. Securities and Exchange Commission regarding its proposed Regulation Crypto Assets. Circle supports the proposal’s goal of promoting innovation under clear rules while maintaining the strengths of U.S. capital markets, including transparency, investor protection, market integrity, liquidity, and efficiency.
Circle suggested that Regulation Crypto Assets should be aligned with the GENIUS Act. Given that payment stablecoins are increasingly becoming an important form of consideration and settlement asset for on-chain capital formation, Circle asked the SEC to clarify how payment stablecoins that comply with the GENIUS Act may be used for these purposes.
The letter further asked the Commission to clarify that qualifying payment stablecoins constitute cash under proposed rule 302(b), should receive appropriate U.S. dollar valuation treatment, and should meet the corresponding accounting and customer reserve treatment conditions. Circle also suggested lowering the current 2% broker-dealer haircut for payment stablecoins that currently comply with GENIUS to zero, subject to objective safeguards.
Finally, Circle asked the SEC to clarify that technical services provided after a network is operational, including maintaining a known set of validating nodes, do not constitute essential managerial efforts. Establishing a safe harbor rule for a technical roadmap would allow issuers to continue maintaining and improving operational networks without unintentionally restarting the related analysis.
Original sources:
Title: Circle Submits Comment Letter on SEC’s Proposed Regulation Crypto Assets Publisher: Circle Date: 2026-10-28 URL: https://www.circle.com/blog/circle-submits-comment-letter-on-secs-proposed-regulation-crypto-assets Source type: company official blog Verification: full text read in this session, accessed on 2026-10-28 Supporting points: submission date, support for the proposal’s goals, alignment with the GENIUS Act, stablecoins as cash, reducing the 2% haircut to zero, technical services not being essential managerial efforts
Title: Circle Internet Group, Inc. comment letter Publisher: U.S. Securities and Exchange Commission Date: 2026-10-20 URL: https://www.sec.gov/comments/S7-2026-27/s7202627-1110319-3937607.pdf Source type: SEC website public comment file Verification: full text read in this session, accessed on 2026-10-28 Supporting points: full original comment letter, confirming all key requests and wording
ABAB AI Insight
Circle’s comment letter focuses on the positioning of payment stablecoins in the proposed rules for crypto asset issuance and on-chain capital formation, asking that they be aligned with the GENIUS Act framework and that their use as consideration and settlement assets be clarified.
Classifying qualifying payment stablecoins as cash under rule 302(b) and suggesting that the broker-dealer haircut be reduced from 2% to zero are specific proposed adjustments to the current net capital calculation and accounting treatment. This continues the direction of the SEC staff’s FAQ guidance on the 2% haircut for payment stablecoins.
The request for clarification that technical services after a network is operational, including maintaining a known set of validating nodes, do not constitute essential managerial efforts, as well as the safe harbor for a technical roadmap, is intended to avoid continued maintenance unintentionally triggering securities analysis again. These are specific implementation suggestions related to the Howey test factors.
ABAB News · Cognitive Law
Payment stablecoins are positioned as consideration and settlement assets in on-chain capital formation.
Qualifying payment stablecoins are suggested to constitute cash under rule 302(b).
Technical maintenance after a network is operational is requested not to constitute essential managerial efforts.