Fed Proposes Stablecoin Rules Amid Growing Digital-Dollar Infrastructure

The Federal Reserve has proposed new rules for stablecoin issuers, including requirements for reserve backing and capital requirements. The proposals are part of a broader effort to establish a comprehensive regulatory framework for dollar-denominated digital payment tokens.

Under the first proposal, Federal Reserve-supervised issuers would be required to fully back their payment stablecoins with specified permissible reserve assets, such as short-term U.S. Treasury bills and other high-quality liquid assets. The proposal also establishes standardized capital requirements addressing credit and operational risks, introduces risk-management standards, and requires institutions to safeguard stablecoin reserves.

The second proposal addresses banks seeking to issue payment stablecoins. It would establish a tailored application process requiring applicants to provide business plans, financial information, and other supporting documents. The Federal Reserve will accept public comments for 60 days following publication of the proposals in the Federal Register.