The Federal Reserve has opened public comment on two proposals establishing rules for payment stablecoin issuers supervised by the Board under the GENIUS Act. The proposals move federal stablecoin policy further from broad legislation into the detailed requirements that issuers and banks would actually have to follow. Federal Reserve
Under the first proposal, supervised payment stablecoin issuers would have to fully back their tokens with permissible reserve assets, including short-term Treasury bills and other high-quality liquid assets. The proposal also establishes standardized capital requirements addressing credit and operational risks. Federal Reserve
Risk management and custody are included as well. The Fed’s framework would establish requirements for supervised firms safeguarding assets backing payment stablecoins and clarify which stablecoin-related activities are permissible for Board-supervised banks. Federal Reserve
The second proposal addresses banks seeking permission to issue stablecoins. Applicants would need to provide business plans, financial information and other documentation through a tailored application process. The framework also establishes procedures for appeals, hearings and final determinations. Federal Reserve
Reuters independently reported the proposals on September 24, confirming the central bank’s move to establish reserve and regulatory requirements required by the GENIUS Act. Reuters
Public comments will remain open for 60 days following publication in the Federal Register. Federal Reserve
TOKEN RECON ASSESSMENT
The stablecoin debate is entering a different phase. The key intelligence is no longer whether Washington will establish a federal framework. It is how expensive and restrictive compliance under that framework will become.
Reserve eligibility, capital requirements, custody standards and approval procedures will influence which institutions can economically operate a stablecoin business.
The comment process is therefore worth monitoring closely. Changes between these proposals and final rules could affect banks, stablecoin issuers and Treasury demand generated by reserve portfolios.
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