U.S. Treasury explores digital ID in DeFi with public consultation

The U.S. Treasury’s public consultation aims to introduce digital identity checks in DeFi smart contracts to reduce illegal financial activities. The plan, guided by the GENIUS Act, could redefine compliance in the DeFi sector.

With the consultation set to continue until October 2025, possible regulations may impact liquidity and compliance costs in DeFi, affecting stability within decentralized finance systems that involve Ethereum and other protocols.

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