Dual registrant regulatory roundup - August 2025

Investment Adviser Anti-Money Laundering Rule Postponed and Reopened for Further Review

• On July 21, the US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) announced its intention to delay the deadline for certain investment advisers to implement anti-money laundering/countering the financing of terrorism (AML/CFT) compliance programs and comply with suspicious activity reporting requirements from January 1, 2026 to January 1, 2028.
• At the same time, FinCEN announced its intention to revisit the scope of the impending AML/CFT requirements and certain other proposed requirements through future rulemaking.
• More comprehensive coverage of FinCEN’s announcement can be found here.

The GENIUS Act: US Law for Payment Stablecoins

• On July 18, President Trump signed the first piece of major US federal legislation in the digital assets space – creating a regulatory and licensing regime in the United States for issuers of payment stablecoins and clarifying that payment stablecoins are not securities or commodities under US law. 
• The GENIUS Act (Guiding and Establishing National Innovation for US Stablecoins Act) establishes a first-ever US federal regulatory framework for “payment stablecoins” – essentially digital assets 100% backed on at least a one-to-one basis by liquid assets (such as low-risk reserves), pegged to the value of a reference national currency (such as the US dollar), and redeemable at a fixed value. The Act also establishes strict marketing requirements for payment stablecoins, requirements for providers of custodial services and for third parties engaged in the business of facilitating exchanges, transfers and sales of payment stablecoins, and is designed to establish a consistent regulatory framework for payment stablecoins by aligning state regulatory regimes with the federal stablecoin framework established under the Act.
• More comprehensive coverage of the GENIUS Act can be found here.

SEC Chairman Paul Atkins Unveils “Project Crypto”

• On July 31, at an event hosted by the America First Policy Institute, SEC Chairman Paul Atkins unveiled “Project Crypto” – described as the “SEC’s north star in aiding President Trump in his historic efforts to make America the ‘crypto capital of the world.’”
• Chairman Atkins noted that he has directed the SEC’s policy divisions to work with the SEC’s Crypto Task Force to “develop proposals to implement” recent recommendations made by the President’s Working Group on Digital Asset Markets, including proposals related to “crypto asset distributions, custody, and trading.” Among other things, Chairman Atkins noted permitting market participants to innovate with “super-apps,” described as allowing securities intermediaries to offer a broad range of products (e.g., crypto asset securities, non-security crypto assets, traditional securities, etc.) and services under one roof with a single license.

Texas Passes Law Regulating Proxy Advisors

• Texas Governor Greg Abbott recently signed into law Texas S.B. 2337, which will establish new disclosure requirements for persons providing proxy advisory services to shareholders of Texas-based entities, foreign entities seeking to reincorporate in Texas, and/or organizations with their principal place of business within the state. The law, according to the Texas legislature, seeks to enhance transparency regarding the extent to which non-pecuniary factors – such as those related to ESG – inform proxy voting recommendations. 
• The law, which goes into effect September 1, 2025, will impose disclosure obligations on proxy voting advisors that make recommendations that are “not solely in the financial interest of” shareholders. Among other things, proxy voting advisers accounting for non-pecuniary factors will be required to describe with “particularity, the basis of” their advice and disclose that “the advice subordinates the financial interests of shareholders to other objectives.” The law will also require rigorous disclosure when a proxy voting adviser makes “materially different” recommendations to different sets of shareholders, including the development of a “specific financial analysis” used to support its recommendation.
• The country’s two largest proxy advisors, Institutional Shareholders Services, Inc. and Glass, Lewis & Co., LLC, have filed lawsuits in Texas challenging the constitutionality of the law.