PANews reported on November 12 that a16z crypto, the crypto division of Andreessen Horowitz, submitted a recommendation to the U.S. Treasury Department, calling for a clear distinction between decentralized stablecoins and payment stablecoins when implementing the GENIUS stablecoin act, and suggesting that decentralized stablecoins be exempted from regulation to promote innovation. In a letter to Treasury Secretary Scott Bessent on November 4, a16z pointed out that decentralized stablecoins (such as Ethereum-collateralized LUSD) are issued through smart contracts and do not require central entity control, therefore they should not be considered "payment stablecoins" as defined in the bill. The bill requires that the issuance of payment stablecoins be limited to licensed issuers. In addition, a16z recommends adopting the decentralized control framework proposed in the Digital Asset Markets Clarity Act of 2025, which would exempt activities such as verifying transactions, running nodes, and developing non-custodial wallets from intermediary oversight. a16z also responded to FinCEN's request for innovative proposals to combat illicit financing of digital assets, proposing the use of privacy-preserving decentralized digital identities as a solution. This technology achieves secure identity verification through techniques such as zero-knowledge proofs and multi-party computation, while protecting personal privacy, reducing cyber risks, and avoiding the surveillance problems of traditional identity systems. a16z believes that this reusable digital identity system can help reduce institutional costs while combating fraud, detecting illegal activities, and strengthening national security and civil liberties.PANews reported on November 12 that a16z crypto, the crypto division of Andreessen Horowitz, submitted a recommendation to the U.S. Treasury Department, calling for a clear distinction between decentralized stablecoins and payment stablecoins when implementing the GENIUS stablecoin act, and suggesting that decentralized stablecoins be exempted from regulation to promote innovation. In a letter to Treasury Secretary Scott Bessent on November 4, a16z pointed out that decentralized stablecoins (such as Ethereum-collateralized LUSD) are issued through smart contracts and do not require central entity control, therefore they should not be considered "payment stablecoins" as defined in the bill. The bill requires that the issuance of payment stablecoins be limited to licensed issuers. In addition, a16z recommends adopting the decentralized control framework proposed in the Digital Asset Markets Clarity Act of 2025, which would exempt activities such as verifying transactions, running nodes, and developing non-custodial wallets from intermediary oversight. a16z also responded to FinCEN's request for innovative proposals to combat illicit financing of digital assets, proposing the use of privacy-preserving decentralized digital identities as a solution. This technology achieves secure identity verification through techniques such as zero-knowledge proofs and multi-party computation, while protecting personal privacy, reducing cyber risks, and avoiding the surveillance problems of traditional identity systems. a16z believes that this reusable digital identity system can help reduce institutional costs while combating fraud, detecting illegal activities, and strengthening national security and civil liberties.