U.S. Stablecoin Rules Raise Stakes for Bank Deposits

Stablecoins move dollar-denominated value over blockchain networks, offering round-the-clock settlement and cheaper cross-border payments. The GENIUS Act, signed into law on July 18, 2025, requires permitted issuers to maintain identifiable reserves at least one-for-one, including cash, bank deposits and short-term U.S. Treasury bills. With the stablecoin market valued at about $300 billion, its expansion could challenge banks’ low-cost funding if issuers place reserves directly into government debt rather than recycling them into deposits, potentially raising lending costs.

The U.S. Treasury proposed implementing rules on Aug. 17, published in the Federal Register on Aug. 18, with comments due by Oct. 19, 2026. Unlicensed U.S. issuance is expected to face restrictions from Jan. 18, 2027, while digital-asset service providers would generally be barred from offering noncompliant stablecoins to U.S. customers from July 18, 2028. Foreign issuers would need comparable home-country supervision, Office of the Comptroller of the Currency registration, reserves at a U.S. financial institution sufficient for U.S. redemptions, and the ability to comply with lawful U.S. orders.