Washington, D.C. (Jan. 8, 2024) – Today, Blockchain Association submitted a letter in response to the request for comments by the Consumer Financial Protection Bureau (the “CFPB”) regarding its proposed rule to define a market for general-use digital consumer payment applications (the “Proposal”). The Proposal, which would give the CFPB supervisory authority over certain “general use digital consumer payment applications,” is overly broad and lacks the requisite analysis to justify such broad application.
As a threshold matter, the Proposal assumes with a minimal hand wave that the CFPB has jurisdiction over digital assets as “funds.” For this to be true, the CFPB must conduct additional rulemaking and analysis on that point. Besides that threshold issue, the Association recommends that the CFPB amend the rule, ensuring it reaches only fiat currency-based transactions, and if the CFPB wishes for the rule to apply to digital assets, the Administrative Procedures Act requires it conduct a far more robust analysis than it included in the Proposal. Additionally, the CFPB should make clear that the Proposal would not apply to non-custodial wallet software developers.
The Association encourages the CFPB to revise the Proposal in light of the considerations outlined in the attached letter. We welcome the opportunity to discuss our comments with the CFPB and its staff and are prepared to work together with the agency to develop a constructive regulatory regime for the digital assets industry that fosters innovation and protects consumers and market participants.