Fed Proposes Stablecoin Rules Under GENIUS Act
The Federal Reserve has proposed two new rules for stablecoin issuers under the GENIUS Act. The proposals aim to implement the law's mandate into reserve, capital, redemption, and bank-approval requirements.
Under the principal proposal, payment stablecoins would need one-to-one backing by permissible reserve assets, including U.S. dollars, insured deposits, and certain Treasury-backed repurchase agreements. Issuers would also be required to publish redemption policies providing for redemption within no more than two business days.
The second proposal would create a tailored Federal Reserve application process for insured state member banks seeking approval to establish subsidiaries that issue payment stablecoins. Applicants would need to submit a business plan, financial information, and related certifications.
The comment period will close 60 days after the notices are published in the Federal Register, allowing public input on both proposals.