Fed proposes GENIUS Act rules for stablecoin reserves and bank issuers
Sep 25, 2026
The Federal Reserve has released two proposed GENIUS Act rules covering the assets that must back payment stablecoins and the approval process for banks seeking to issue them through subsidiaries.
How the Fed would regulate stablecoin reserves
Under the first proposal, a Fed-supervised issuer would have to hold permissible assets that fully back its outstanding payment stablecoins. The Fed identified short-term U.S. Treasury bills and certain other high-quality, liquid assets as examples of eligible reserves. Full backing means issuers must hold assets against the tokens they issue, rather than rely on a smaller pool of reserves.
How banks would seek stablecoin approval
The second proposal applies specifically to insured state member banks seeking Fed approval for a subsidiary to issue payment stablecoins. Under the Fed’s application draft, the bank would file the application with its appropriate Federal Reserve Bank. The bank, rather than the proposed subsidiary, would be the applicant.
Where the GENIUS Act rulemaking stands
The Fed’s proposals join rulemaking already underway at other U.S. agencies. In August, crypto.news covered Treasury’s proposed definitions for when payment stablecoins are issued, offered, or sold in the United States. Treasury’s questions concern which activity falls under U.S. licensing and distribution restrictions, while the Fed’s new drafts address issuers it supervises and applications from insured state member banks.
The Office of the Comptroller of the Currency has been working on a separate framework for issuers under its authority. As reported in August, Comptroller Jonathan Gould set a November target for final OCC rules after industry feedback. Its proposal covers matters including reserves, redemptions, custody, supervision and issuer applications. The OCC timetable does not set a completion date for the Fed’s newly released proposals.
Treasury has identified Jan. 18, 2027, as the expected effective date for the GENIUS Act’s main issuer restrictions. The statute also provides for an earlier start 120 days after the responsible federal regulators issue their final implementing rules. Federal agencies missed the law’s July 18, 2026, deadline for completing those rules, leaving several proposals at different stages of review.
For the two Fed notices released on Sep. 24, interested banks, issuers, and other members of the public can submit comments during the 60-day period following Federal Register publication. The application proposal identifies the Fed’s online proposal system, mail, and email as ways to file responses, with submissions identified by their docket number.
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