Treasury Proposes Rule on Payment Stablecoin Issuance in the US

The US Treasury has proposed a rule that clarifies who can issue and sell payment stablecoins in the United States. The GENIUS Act, which was passed in 2025, makes it illegal for anyone other than licensed issuers to issue payment stablecoins in the US.

The proposed rule defines who is subject to the GENIUS Act, including foreign-issued stablecoins that are offered or sold to people in the US. This means that companies operating from outside the US could be considered to be doing business in the US if they serve American customers, even if their servers are located elsewhere.

The rule also sets a deadline for compliance: starting January 18, 2027, no one can issue a payment stablecoin in the US without holding an appropriate license. By July 18, 2028, platforms must only offer stablecoins issued by licensed permitted payment stablecoin issuers or foreign issuers with reciprocity determinations from Treasury.

Tether, the issuer of the largest stablecoin USDT, is facing significant challenges under the new rule. Its reserves currently include assets that do not meet the GENIUS Act's requirements, and it needs to restructure around $47 billion worth of assets before it can qualify for a reciprocity determination.