Fed Seeks Comment on Stablecoin Regulation Proposals

The US Federal Reserve Board has opened a public comment period on two proposals for establishing a regulatory framework for supervised payment stablecoin issuers under the GENIUS Act.

The first proposal would require stablecoin issuers to fully back their coins with reserve assets, such as short-term Treasury bills and other high-quality, liquid assets. This would also standardize capital requirements to address credit and operational risks, and set risk-management standards.

The second proposal establishes an application process for banks seeking to issue payment stablecoins, requiring them to submit business plans and financial information. It also creates a process for appeals, hearings, and final determinations for applications.