This comment addresses the Treasury's proposed principles for determining whether state-level regulatory regimes are "substantially similar" to the federal PPSI framework. It argues that equivalence without interoperability creates fragmented stablecoin networks and recommends including trust registry interoperability, credential portability, Travel Rule messaging compatibility, reserve attestation proof format compatibility, examination submission package compatibility, and periodic interoperability review as criteria in the equivalence determination.
ZKProva Inc.
Compliance Technology & Infrastructure
April 10, 2026
U.S. Department of the Treasury
1500 Pennsylvania Avenue NW
Washington, DC 20220
Re: GENIUS Act Broad-Based Principles for Determining Whether a State-Level Regulatory Regime Is Substantially Similar to the Federal Regulatory Framework — Comment on Interoperability and Federation Standards for Cross-Regime Stablecoin Operations
Dear Treasury Officials:
ZKProva Inc. is a compliance technology company that has developed GeniusComply (deployed at ppsiready.com), a production compliance testing infrastructure platform purpose-built for institutions preparing for permitted payment stablecoin issuer (PPSI) licensure under the GENIUS Act. ZKProva has submitted extensive comments to both the NCUA (Docket No. NCUA-2026-0265; seven comment letters covering pre-licensure compliance testing, consumer disclosures, examiner tooling, reserve attestation, AML/FinCEN automation, CUSO aggregation, and wallet credential state machine standards; Tracking IDs: mnk-icx3-0rd5, mno-0mc6-didw, mno-0qt5-kz5r, mnq-s497-hxgm, mnq-sqc4-isv8, mnt-gxgw-810f, mnt-hnve-wmmg) and the OCC (Docket ID OCC-2025-0372; comprehensive technical standards comment).
We submit this comment to address a specific aspect of the Treasury's Notice of Proposed Rulemaking on state-level regime equivalence: the interoperability and federation standards that should govern interactions between state-regulated and federally regulated PPSI issuers. Our comments are informed by direct engineering experience building cross-institution federation infrastructure — specifically, Merkle tree-based trust registries, cross-PPSI credential verification, and Travel Rule compliance for inter-institution stablecoin transfers.
ZKProva holds a patent-pending federated trust registry framework (Continuation-in-Part of PROV-007) that addresses the technical challenges of multi-regime federation.
The GENIUS Act requires that state-level regulatory regimes be "substantially similar" to the federal framework as a condition for state-regulated PPSI issuers to operate nationally. The Treasury's NPRM proposes broad-based principles for making this determination but focuses primarily on substantive compliance requirements (reserve adequacy, consumer protection, AML/BSA programs) without addressing the technical interoperability standards that enable stablecoins to function across institutional and regulatory boundaries.
A state regime that meets every substantive compliance requirement but uses incompatible technical standards — different proof formats for reserve attestation, different credential schemas for wallet binding, different messaging protocols for Travel Rule compliance — would create a stablecoin ecosystem in which state-regulated and federally regulated issuers cannot interoperate. Members of a state-regulated PPSI would be unable to transfer stablecoins to or from a federally regulated PPSI without costly and error-prone bridging infrastructure. This fragmentation would undermine the GENIUS Act's intent to create a unified national stablecoin framework.
We recommend that the Treasury include the following federation and interoperability standards as criteria in the "substantially similar" determination:
1. Trust registry interoperability. State regimes should require PPSIs to participate in a trust registry that enables other PPSIs — regardless of their regulatory jurisdiction — to verify the legitimacy and compliance status of the state-regulated PPSI. The trust registry should support cryptographic membership verification (e.g., Merkle proof of membership) and should be interoperable with trust registries used by federally regulated PPSIs.
2. Credential portability. State regimes should require PPSIs to issue wallet credentials in a format that is portable across regulatory jurisdictions. A member verified by a state-regulated PPSI should be able to present their compliance credentials to a federally regulated PPSI without undergoing redundant CIP verification. This requires standardized credential schemas — ideally based on W3C Verifiable Credentials — and standardized proof formats.
3. Travel Rule messaging compatibility. State regimes should require PPSIs to support Travel Rule messaging (31 CFR 1010.410) in a format compatible with the federal framework. The Travel Rule tier classification (exempt below $3,000, standard $3,000-$9,999, enhanced $10,000+), the PII handling requirements (SHA-256 hashing of personally identifiable information), and the message lifecycle (creation, acknowledgment, expiry) should be consistent across state and federal regimes.
4. Reserve attestation proof format compatibility. State regimes should require PPSIs to produce reserve attestation proofs in a format that is verifiable by examiners from any jurisdiction. If the federal framework adopts Groth16 zk-SNARK proofs with specific public signal definitions (accumulator root, supply commitment, eligibility root, sufficiency flag), state regimes should require the same proof format — or a format that is provably convertible to the federal format — to enable cross-regime examination.
5. Examination submission package compatibility. State regimes should require PPSIs to produce examination submission packages in a format compatible with the federal standard. If the federal framework adopts the NCUA-PPSI-EXAM-v1 format (ZIP archive with manifest, signed W3C VC attestation, structured findings, and monthly proof artifacts), state regimes should adopt the same format or a compatible superset.
The Treasury should recognize that the "substantially similar" determination is not a one-time assessment but an ongoing interoperability requirement. As the stablecoin ecosystem evolves, new technical standards will emerge, and both state and federal regimes will need to adapt. We recommend that the Treasury establish a process for periodic review of interoperability standards — for example, an annual assessment of whether state-regulated PPSIs can successfully participate in federation networks, process cross-regime transfers under Travel Rule requirements, and produce examination artifacts that are verifiable by federal examiners.
ZKProva's patent-pending federated trust registry testing framework (Continuation-in-Part of PROV-007) provides a technical mechanism for this verification: a Merkle tree-based trust registry in which both state-regulated and federally regulated PPSIs hold leaf positions, with the registry root serving as a cryptographic commitment to the full set of participating issuers. Cross-regime membership verification can be performed by any party using a standard Merkle proof, without requiring access to the full registry.
ZKProva has implemented cross-institution federation infrastructure in production as part of the GeniusComply platform (ppsiready.com). Our implementation includes: a Merkle tree-based federation with auto-assigned leaf indices; staged root updates with atomic approval across all members; membership verification via Merkle proof reconstruction; Travel Rule messaging with three-tier classification, SHA-256 PII hashing, and 24-hour message expiry; W3C Verifiable Credential-based wallet credentials; and reserve attestation proofs in Groth16 format with standardized public signals.
This implementation demonstrates that cross-regime interoperability is technically achievable and that the standards recommended in this comment can be verified through automated testing.
We respectfully request that the Treasury include the following interoperability standards in the "substantially similar" determination:
The GENIUS Act's "substantially similar" standard is the mechanism through which a unified national stablecoin framework is achieved. Substantive compliance equivalence is necessary but insufficient — if state-regulated and federally regulated PPSIs cannot interoperate technically, the stablecoin ecosystem will fragment along regulatory lines, defeating the purpose of the federal framework. The interoperability standards recommended in this comment ensure that "substantially similar" means "functionally interoperable," enabling members to transact across issuers regardless of their issuer's regulatory jurisdiction.
ZKProva Inc. welcomes the opportunity to provide technical demonstrations, implementation specifications, or testimony in support of these comments.
Respectfully submitted,
Viswanadha Pratap Kondoju
Inventor & Technical Advisor
ZKProva Inc. (incorporation pending)
Disclaimer: This page is an informational archive of a public regulatory comment. It does not constitute legal advice. ZKProva Inc. is not a law firm and no attorney-client relationship is created. Not affiliated with, endorsed by, or sponsored by the NCUA, OCC, or U.S. Department of the Treasury.