Fed Seeks Public Comment on Stablecoin Issuer Framework

The Federal Reserve Board has initiated a public consultation on two proposals related to establishing a regulatory framework for payment stablecoin issuers under the GENIUS Act.

The proposals aim to address credit and operational risks associated with payment stablecoins by requiring issuers to fully back their coins with permissible reserve assets, such as short-term Treasury bills and other high-quality, liquid assets.

The second proposal establishes a tailored application process for Board-supervised banks applying to issue payment stablecoins, which would involve submitting business plans and financial information among other documents.