The Federal Reserve Board proposed two rules on September 24 to implement the GENIUS Act for payment stablecoin issuers, seeking public comment on a framework that would require issuers to fully back their tokens with permissible reserve assets and set new capital and risk-management standards. The proposals, released at 2:30 p.m. Eastern time, mark the central bank’s latest step to put its portion of the U.S. stablecoin law into effect and give banks a clearer path into the business of issuing dollar-pegged tokens. The move hands banks and issuers a first concrete look at how the Fed intends to supervise a market that has grown into a core piece of digital-asset plumbing.
Full reserve backing and capital standards
The first proposal would require Board-supervised payment stablecoin issuers to hold reserve assets whose value fully covers their outstanding coins at all times. Permissible reserves would include short-term Treasury bills and certain other high-quality, liquid assets. Issuers would also face standardized capital requirements to address the credit and operational risks of payment stablecoin activities, as well as risk-management standards set out under the law. The same proposal would introduce rules for Board-supervised firms that safekeep the assets backing payment stablecoins and clarify the permissibility of stablecoin and related activities for Board-supervised banks.
An application path for banks
The second proposal would create a tailored application process for Board-supervised banks seeking to issue payment stablecoins. Applicants would be required to submit a business plan and financial information, among other documents, and the draft establishes a process for appeals, hearings, and final determinations. The Fed’s rulemaking lands amid a broader U.S. push to write crypto into formal regulation, alongside legislative proposals such as the CLARITY Act, the crypto bill that could reshape market-structure oversight.
What comes next
The comment period will close 60 days after the two proposals are published in the Federal Register. The GENIUS Act, the Guiding and Establishing National Innovation for U.S. Stablecoins Act, sets the federal framework for payment stablecoin issuance, and the Fed’s proposals would govern the issuers and reserve custodians under its supervision. The move also lands as regulators in other jurisdictions tighten stablecoin oversight, with central banks pushing to restrict stablecoin activity across Europe.
