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Nonprofit Organizations and Digital Assets, Beginning with Stablecoins

In July of 2025, the U.S. Congress enacted a law titled: “Guiding and Establishing National Innovation for U.S. Stablecoins Act” (commonly referred to as “the GENIUS Act”). This law would permit the issuance of a form of digital asset known as a “payment stablecoin” that would be used only for purposes of payment or settlement and not investment. Among various entities, payment stablecoins maybe issued by depository institutions but are not federally insured. Rather, they are supported by the requirement that every payment stablecoin issuer maintain a reserve fund of equal value to its outstanding payment stablecoins in U.S. dollars or items of a similar form.

In the course of implementing the GENIUS Act, the U.S. Department of the Treasury requested comments from the general public with respect to future regulation. The memorandum below was submitted in response.

From: Lori G. Nuckolls, Public Policy Researcher and Writer, Philosophy, Law and Politics (lorigaylenuckolls.blog)

To: U.S. Department of the Treasury, Attention: Office of the General Counsel, 1500 Pennsylvania Avenue NW, Washington, DC 20220, Via Electronic Submission: https://www.regulations.gov

Re: GENIUS Act Implementation Comments, TREAS-DO-2025-0037, 90 Fed. Reg. 45159-45163 (Sept. 19, 2025), 90 Fed. Reg. 47251 (Oct. 1, 2025) (Submission date extension)

Date: November 1, 2025

I. Introduction

The GENIUS Act, 12 U.S.C. §§ 5901-5916 (2025), was enacted with the legislative purpose of providing legal guidance and regulation in the use of stablecoins as a digital asset. A statutorily created “payment stablecoin,” denominated in U.S. Dollars, would be issued by legally approved entities and would allow entrance into the digital marketplace in a safe and sound manner. 90 Fed. Reg. 45159 (Sept. 19, 2025). In regulating the issuance of payment stablecoins by subsidiaries of depository institutions, specifically nonprofit depository institutions such as credit unions, the U.S. Department of the Treasury should consider regulations that support and permit as well require the nonprofit organizations to honor their asserted charitable mission and purpose. With respect to the credit union, this would be pursuance of its historical mission and purpose of enabling its governing members to obtain access to historically unavailable financial services, develop financial literacy, and transition into a competitive socio-economic environment premised upon self-government and self-sustainability. Credit unions which have already successfully entered the heretofore unregulated digital asset marketplace offer extensive and direct training to leaders, staff, and members to avoid financial loss. Participation of credit unions, large and small, in a well-regulated digital asset marketplace would facilitate the long-sought self-government and financial growth of members.

The Department of the Treasury should consider that nonprofit financial institutions bear a higher ethical standard than do for-profit entities. Their existence depends upon their reputation within the communities they serve and the absence of their engaging in intense competition with their peers. Credit unions rely upon the trust they engender in society, not to mention donors, volunteers and members. In governing the payment stablecoin activities of all nonprofits, including credit unions, regulators should premise requirements upon the principle that the trust engendered by the conduct of the nonprofit organization is based upon not only the appearance of propriety but also upon the absence of even the appearance of impropriety.

As a consequence, regulation could guide nonprofit organizations in achieving balance between engaging in authorized emerging digital assets and guaranteeing the financial stability of the communities served. Whereas, unleashing digital assets in a scarcely regulated environment to enable the efficiency, directness and globalization emerging digital technologies provide, would be an example of dialectical creative destruction. And, this achievement of positive development while permitting a threshold level of hardship is to be mitigated in the regulatory process. Specifically, in the historically financially fragile communities of the credit union, little is achieved by regulation allowing entrance into the digital asset marketplace if the burden of greater risk is endured by the financial communities most in need. Thus, questions arise as to how regulation of the nonprofit organization is to be structured in theory and practice.

II. Credit Union Subsidiary Issuers of Payment Stablecoins: a Theory of Regulation to Avoid the Creative Destruction Dialectic

The GENIUS Act currently provides that all issuers of payment stablecoins, state and federal, are required to meet federal standards. 12 U.S.C. § 5903(c) (2025). In regulating nonprofit organizations and, guiding regulation by the National Credit Union Administration of credit unions and the distinct communities they serve, perhaps the Department of the Treasury could consider the theoretical doctrine of the “veil of ignorance” established by American philosopher John Rawls. In the veil of ignorance, Rawls suggests that society place itself in the “original position” in which each individual in society envisions oneself to not know one’s specific place in society. (Rawls, A Theory of Justice (1971)).

In this case, the principles of the veil of ignorance guide governing leaders and citizens in reaching agreement as to public policy, law and regulation. Choices in law would be determined by a general understanding as to what being a citizen should mean. Commonality of thought would arise from leaders and the public alike perceiving themselves guided by the veil of ignorance under which they reach decisions and enact laws without consideration of their own personal circumstance and condition. Rather, each person deems their position to be that of those most vulnerable and in need. And, in turn, they seek a legal structure most capable of providing a just and fair society.

Specifically, the Department of the Treasury would identify with credit union staff and members most benefiting from the financial services and training provided and least familiar with emerging digital asset technologies. Safe harbor regulations for credit unions and other nonprofit organizations would guide the ambitious and encourage the wary ones unfamiliar with the digital asset marketplace. For, both are truly outnumbered by for-profit entities. In doing so, credit union regulation, in particular, would allow financial growth through the creative use of digital assets while maintaining a safety net for the credit union governed by members most in need of financial literacy and growth.

The GENIUS Act and its framework for the issuance of payment stablecoins as a creature of statute is a blank slate. It enables the beginning of a new economy premised upon regulation in the John Rawls original position, derived from the veil of ignorance. For example, both regulators and credit unions, including their issuer subsidiaries, would envision themselves in the position of a credit union with truly dependent members situated in a community of similar prospective members increasing in number. To continue in existence, this credit union and its members must be knowledgeable of market development, namely the advent of digital assets. In this position, Treasury would govern with reference to legal standards that would enable an understanding of rights, powers, and privileges, as well as the risks they engender. From this new beginning, credit unions would be able to implement risk assessment policies allowing the balancing of legally authorized conduct against the forbearance of some legally permitted activity in order to maintain trust and goodwill within the community. For, credit unions might not need to be as ambitious and as competitive as the GENIUS Act possibly allows.

III. Conclusion

With the GENIUS Act as a beginning, Congress and the administrative agencies may readily provide financial regulation of all nonprofit organizations as they enter every aspect of the digital asset marketplace. In guiding this transition, the law should promote new strategies of growth and risk management as to digital assets as it has historically with respect to more traditional financial markets.

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Must Women of Color Endure Destruction to Succeed?

In the philosophy of G.W.F. Hegel, society develops and history unfolds in a difficult and inconsistent manner. Specifically: an event occurs; the event encounters a negative reaction; and in the end progress results from the combination of the two. This is termed the Hegelian dialectic. We ask with respect to the world history of women of color whether and why their gradual social progress has endured such a step forward, step backward process to development?

Access to training and education in all occupations and professions is necessary to permit women of color to support themselves and their families. This training and education has become more available historically yet not without hardships such as inadequate preparation, inadequate funding and inadequate networking post-graduation. The negative reaction to the positive step of access to training and education is cyclical. Without adequate education, participation in society and government is not possible to an extent that equality may be pursued legally, socially and economically. Any subsequent advancement through legal reform is minor in comparison to that accorded the pyramidal strata above women of color who inhabit the bottom stratum, socioeconomically and emotionally.

In America, it has been legally affirmed that racially segregated institutions are improper. They instill a cultural distance, an inability to participate and a sense of inferiority. Yet, social segregation remains in schools, the workplace and social organizations. In religious organizations and social clubs, more appear segregated than not, ostensibly voluntarily. The stigma of racial segregation is upon women of color most of all.

Worldwide, overtime, reforms in laws, customs, and social institutions have occurred and as a result socioeconomic strata blend, academic achievement improves and women of color have achieved a greater sense of participation in society. However, with these positive developments, in the thought of Hegel, negative reactions occur before the positive are again experienced.

True reform should be unilateral with no reverses. Solutions abound as to how the Hegelian negative reaction may be avoided. For instance, America should look beyond the disparateness of its two political parties, a duopoly of two political parties which together dominate elected offices. It is the fact that women of color are elected to government offices more than in the past. And, this is a beginning.

However, in the social sphere segregation remains and the two major American political parties have not addressed this dilemma. For example, the topic of the American Black church is longstanding. Churches should become racially integrated. Integration in religion is a subject the two political parties should discuss as one of cultural and social importance. Party members should express their belief in the significance of integration in religious organizations by both welcoming those of another race into their church and by expressing interest in churches with congregations of another race. Members of integrated churches should be recruited to run for office.

Individually, worldwide, we should expand our own frontiers and explore religious organizations of races other than our own. Religious entities of one race my merge with one of another. In the words of Hegel: “Reason governs the world” through “religious truth” well- known to us. Religion through reason can guide us in social development without corresponding hardship.

Humanity relies upon religious entities and various additional nongovernmental organizations to remedy injustice and lead in suggesting reforms. Many religions guide society in improving its customs, laws and morality. On the subject of the lives of women of color, religion should provide support for social advances and improvements and assist to mitigate Hegelian reverses. For none of us should life be akin to the rise of Jim Crow in response to newfound freedom.

Lori Gayle Nuckolls

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A Right and Obligation to Participate

We all deserve representation. The current distress ending in violent unrest indicates a lack of adequate political representation. This is evident in a growing increase in the divide between the haves and the have nots in an increasing number of personal attributes. Many are without an access and understanding of emerging technologies, funding and access to higher education and health care. This is most evident in America’s rural and inner-city communities.

The rights we all possess go back to the early days of the Magna Carta, 1215. These fundamental rights of the individual are now deemed possessed by all within our global community, only after periods of time in which evolving and developing societies came to realize that these rights did not belong to a limited few.

In order to avail oneself of the various rights we possess as individuals, we must be able to self-govern and reach informed decision making about our place in society and our choice of governing leaders and government structure. Identifying our public responsibilities and obligations requires that we imagine that we are behind the John Rawls “veil of ignorance.” This is a circumstance in which we do not know our own place in society. And, we must determine the threshold socio-economic level we require for subsistence and survival.

In the thoughts of Alexis de Tocqueville, one of the greatest threats to democracy is pauperism. We must admit that pauperism exists on a global scale. Tocqueville believed that pauperism is best overcome by the guidance provided to the public by the productivity and efficiency of a capitalist economy.

In Tocqueville’s day this guidance was provided by local financial institutions. Small financial institutions located in individual, political subdivisions, close to the public, instill values required to adequately participate in society and a representative democracy. Currently in America, local branches of financial institutions impart capitalist ideals of self-sufficiency and money management through financial counseling. And these institutions guide small account holders in their use of emerging technologies and personal accounts, from making deposits to money transfers and investment. According to Tocqueville, these activities encourage principles of self-sufficiency and upward mobility. For Tocqueville, this was more feasible in rural communities where small farmers needed guidance with harvest management to avoid the force majeure, boom to bust circumstance of inclement weather. Cities for Tocqueville were more difficult. Industrial economies of the 1830s resulted in cycles of unemployment with periods of low product demand and an ever-increasing urban population that could not support itself. Modern financial institutions, now, provide an economic didactic to entrepreneurial development, emerging technologies and failing, outmoded industry.

Fear of an inability to provide for oneself and participate as an equal member of society generates protest, and rebellion, both at home in America and abroad. As an initial step, perhaps we should look to the sources of this insecurity and ask how would we respond if we were sitting in the place of the insecure and what the public response should be. What would I, as an individual and participating member, require to engage in informed voting? Perhaps Tocqueville and Rawls offer a beginning. And, in the thoughts of J. Hector St. John de Crèvecœur: from soil values grow.

Lori Gayle Nuckolls

How Does America Participate In An International Legal Community?

How do we reconcile our commitment to our capitalist economy with the true underpayment of attorneys in America? Capitalism possesses a theoretical basis in quality through competition. Yet, our private, corporate sector disavows its obligation to engage professional development through adequate and equal compensation. For, a great disparity exists between executive salaries and those of private sector attorneys, as to both in-house counsel and private law firms. This exists despite the fact that attorneys must attend graduate school at a younger age.

An argument posed by the corporate sector is that business persons, young and old, are paid more because they generate more business, more value added in a capitalist economy. Yet, the business sector must acknowledge that private sector attorneys are within a profession that lofts the overarching common law under which our world exists and under which corporate transactions and technological developments occur. The common law has existed from time immemorial and our modern world recognizes it in an international sphere.

A structural solution must be created that acknowledges that not only do young, private sector law firm attorneys not benefit from term-in-years employment agreements as do corporate employees. They, instead, work on an at-will basis with no employment security. Also, attorneys are governed by ethical codes imposed by law that result in the quality of thought we readily discern. This, in addition to inadequate compensation, creates anxiety and stress in a profession but for the quality of which we would not possess the talents and abilities upon which we rely.

The answer is to begin from the top with our multi-national corporations. These corporate entities employ law firms and pay far less in compensation for the legal services they receive than is acceptable. The stress and professional hardship incurred by law firm attorneys and staff must be mitigated by payment of higher legal retainers by corporations. In turn, government attorneys would also receive greater compensation. For, our society must realize that our taxes paid are necessary for life essentials. If higher taxes are required, so be it.