Fed Proposes Tough New Rules for US Stablecoin Issuers
The Federal Reserve has proposed new rules for US stablecoin issuers, requiring them to fully back their cryptocurrencies with quality liquid reserves at all times and diversify these assets. The proposal aims to implement the July 2025 GENIUS Act, which seeks to address operational risks by imposing capital requirements on issuers and reserve assets.
The rule would also establish a tailored application process for banks applying to issue stablecoins. This move is seen as an effort to regulate the rapidly growing digital currency market and provide greater transparency and stability.
The proposal would require stablecoin issuers to maintain quality liquid reserves that are easily convertible into cash, reducing the risk of asset mispricing and default. The rule would also address operational risks by imposing capital requirements on issuers and reserve assets, such as uninsured deposit claims and undercollateralized reverse repurchase agreements.