Ninety-one days. That is the gap between October 19, when the U.S. Treasury closed the public comment window on its proposed payment-stablecoin rule, and January 18, 2027, the date the GENIUS Act takes effect. The final rule still does not exist. The window closed Monday with the proposed text of a new 12 CFR Part 1523 on the record and no published final rule from Treasury, the Office of the Comptroller of the Currency, the FDIC, or the Federal Reserve, according to the notice of proposed rulemaking that carried the October 19 deadline.
The proposal, docket TREAS-DO-2026-0496 and RIN 1505-AC95, implements Section 3 of the GENIUS Act, the Guiding and Establishing National Innovation for U.S. Stablecoins Act enacted on July 18, 2025. Section 3 sets the fundamental boundaries of who may issue, offer, or sell a payment stablecoin in the United States. The comment window closing matters because it is the last formal input the industry gets before Treasury drafts the final rule, and because the statutory clock it feeds is already running.
What the Proposed Rule Would Prohibit
Treasury’s proposal adds Part 1523 to title 12 of the Code of Federal Regulations and splits its work across five sections plus an interpretive appendix. Proposed §1523.1 defines the scope and the key terms. Proposed §1523.2 implements the issuance prohibition. Proposed §1523.3 implements the offer-and-sale prohibitions that apply to digital asset service providers. Proposed §1523.4 sets out exemptions and safe harbors, and §1523.5 carries a severability provision.
The central definition is borrowed from the statute. A payment stablecoin is “a digital asset (i) that is, or is designed to be, used as a means of payment or settlement, and (ii) the issuer of which is obligated to convert, redeem, or repurchase for a fixed amount of monetary value.” The definition deliberately excludes investment tokens: a payment stablecoin is not a security or a commodity under the Act, and Treasury’s preamble makes clear it did not start from securities or commodities law as its baseline.
The rule also defines “located in the United States” in a way that reaches individuals physically present in the country while excluding U.S. residents temporarily abroad, and it treats a business entity as located in the United States if it is organized under U.S. or state law or has its principal place of business here. Treasury is explicit that the part “is intended to have extraterritorial effect if conduct involves the offer or sale of a payment stablecoin to a person located in the United States.” A foreign issuer that sells into the U.S. market is inside the rule’s reach.
The $1 Million Penalty and the Two Clocks
The enforcement lever sits in Section 3(a), which makes it unlawful for any person other than a permitted payment stablecoin issuer to issue a payment stablecoin in the United States. “Knowing participation in a violation of section 3(a) is punishable by a fine of not more than $1 million for each violation, imprisonment for not more than five years, or both under the Act.” The phrase “for each violation” is the part worth reading twice: this is a per-instance penalty, not a one-time ceiling, so a series of unlawful issuances compounds.
Two separate effective dates then govern the downstream distribution rules. The first, under Section 3(b)(1), is the one with the longest fuse: “beginning on July 18, 2028 (i.e., the date that is three years after the date of enactment of the GENIUS Act), it shall be unlawful for a digital asset service provider to offer or sell a payment stablecoin to a person in the United States, unless the payment stablecoin is issued by a permitted payment stablecoin issuer.” That is a three-year runway for exchanges, brokers, and custodians to ensure the stablecoins they list come from permitted issuers.
The second clock is shorter and is the one the comment window just fed. Under Section 3(b)(2), the prohibition on offering a foreign-issued payment stablecoin to U.S. persons applies “on the effective date of the Act” — January 18, 2027, eighteen months after the July 18, 2025 enactment. A foreign issuer can stay in the U.S. market only by showing it has the technological capability to comply with lawful orders and reciprocal arrangements, and by registering with the OCC under a comparable foreign supervisory regime. Between the October 19 comment deadline and that effective date sit exactly 91 days.
The Gap Between a Closed Comment Window and a Live Law
The arithmetic is where the risk sits. The Act took effect eighteen months after enactment, which lands on January 18, 2027. The proposal on the record now is still a proposal: comments received by October 19 have to be read, considered, and answered before a final rule can be drafted, cleared, and published. Treasury has not published a final rule, and the proposal itself does not set a finalization date. Issuers and platforms are therefore preparing to comply with a statutory scheme whose binding operational text is not yet written.
The proposal does contain the relief valves an issuer would rely on in that gap. Section 5(f) of the Act lets the primary federal regulators waive the requirements for up to twelve months for subsidiaries of insured depository institutions and for federal qualified issuers with a pending application on the effective date. Proposed §1523.4 carries the safe harbors, including one for de minimis transaction volumes and one for unusual and exigent circumstances. And Section 3(h) carves out three transactions entirely: direct person-to-person transfers without an intermediary, transfers between a person’s own U.S. and foreign accounts at the same parent company, and self-custody wallet activity.
What the comment window did not change is the direction of travel. The NPRM is one layer of a stack that includes the OCC’s issuer-licensing rule, FinCEN and OFAC’s anti-money-laundering and sanctions proposals, and the SEC’s separate crypto-assets rulemaking. BlockchainReporter’s earlier report on the Treasury opening this proposal to comment in August is the baseline for that timeline, and the SEC’s parallel custody rulemaking for advisers and funds shows the same pattern: a proposed framework now, with the compliance dates set by when the final text lands.
The Numbers to Watch Over the Next 91 Days
Three figures now matter more than the rest. First, the 91-day countdown to January 18, 2027, which is the effective date the foreign-issuer prohibition keys off and the deadline by which every issuer needs a license or a waiver. Second, the twelve-month Section 5(f) waiver window, which is the maximum cushion a qualifying issuer can ask for and which still requires a pending application to exist. Third, the July 18, 2028 distribution deadline, which is the last date for exchanges and platforms to be listing only permitted-issuer stablecoins.
The next observable signals are concrete. A final Treasury rule, whenever it lands, is the first. The OCC’s final issuer-licensing rule is the second, since a foreign issuer’s U.S. path runs through OCC registration and a comparability determination that does not exist yet. The SEC’s Reg Crypto Assets comment window closes the day after this one, on October 20, and the Financial Accounting Standards Board’s stablecoin cash-equivalent proposal closes November 19. Each one narrows the uncertainty, but none of them yet replaces the proposed Part 1523 with a final one. Until they do, the 91-day number is the one that counts.
What remains unanswered is the substance, not the schedule. The comment period was the industry’s last chance to argue over how broadly “offer” and “issue” are drawn, how the foreign-issuer comparability test should work, and where the de minimis line falls. Treasury now holds those answers. The clock does not pause while it writes them.
