U.S. Treasury Proposes New GENIUS Act Stablecoin Rules

Signed into law on July 18, 2025, the GENIUS Act established the first US federal regulatory framework for payment stablecoins. It requires issuers to maintain one-for-one reserves in cash and other highly liquid assets and sets standards for redemptions, disclosures and federal-state oversight. The implementing rules are critical for banks and crypto firms seeking regulatory certainty as dollar-backed tokens become more deeply integrated into payments and financial markets.

By the law’s first anniversary on July 18, 2026, the Treasury Department, Federal Reserve, OCC, FDIC, NCUA, SEC and CFTC had all failed to complete final rules by the statutory deadline. The Fed had not even issued a proposed rule. With no automatic interim regime to bridge the delay, issuers remain subject to existing laws while awaiting the new framework, which is scheduled to take effect no later than Jan. 18, 2027.

Stablecoins typically maintain their value through assets denominated in U.S. dollars and have become an important dollar channel for crypto trading and cross-border payments. The United States signed the GENIUS Act into law on July 18, 2025, establishing a federal issuance framework for the first time. It requires every $1 token to be backed by at least $1 in eligible reserve assets. Stablecoins, however, are not bank deposits and are not covered by FDIC deposit insurance.

The FDIC board approved a proposed rule on April 7, 2026, and published it in the Federal Register on April 10. The proposal would require issuers under its supervision to meet standards covering reserve assets, redemption within two business days, capital, risk management and custody. The OCC issued its own proposal on February 25, followed by customer identification rules proposed by five federal agencies on June 18. Final rules had yet to be issued by the July 18 statutory deadline.

The GENIUS Act, signed by US President Donald Trump in July 2025, established a dual federal-state regulatory framework for payment stablecoins. It allows issuers with a market capitalization of no more than $10 billion to be regulated at the state level when state laws are broadly comparable to federal standards, making the provision critical to states’ supervisory role and the compliance options available to small and midsize operators.

On June 16, 2026, a bipartisan group of seven senators led by Cynthia Lummis sent a letter to US Treasury Secretary Scott Bessent urging the department to maintain flexibility in state certification and prevent the process from becoming a one-time window. The Treasury sought public comment in April, with submissions closing on June 2. According to CoinGecko data, only Tether, USDC and USDS exceed $10 billion in market value, leaving all other stablecoins potentially eligible for state-level oversight.

The New York State Department of Financial Services established a state-level framework for U.S. dollar stablecoins in June 2022, requiring full reserves, redemption rights and independent attestations. After the U.S. GENIUS Act was signed into law on July 18, 2025, state regimes must be substantially consistent with federal standards, a requirement that will determine whether licensed issuers including Circle, Paxos and Gemini can continue operating.

NYDFS unveiled the proposal on June 9, 2026, opening a 10-day pre-proposal comment period to be followed by a 60-day consultation after formal publication. The rules would limit reserve concentration with any single custodian and cover seven categories of risk management, including internal controls, cybersecurity and internal audits. Issuers with $25 billion in circulation would have to hold at least 0.5% of reserves in safeguarded deposits each day, capped at $500 million. The rules would take effect alongside the GENIUS Act, with existing operators receiving a 12-month transition period.

Stablecoin regulation is in focus as the U.S. Congress returns. The GENIUS Act seeks to establish a federal regulatory framework whose rules will shape issuers' reserve-asset quality, yield distribution and compliance obligations. The framework will also affect the market strategies of banks, payment providers and cryptocurrency companies.

The public comment period for the GENIUS Act's stablecoin rules concluded in the first week of June, while the U.S. Senate is expected to make another push on the Clarity Act on June 3. As the regulatory process accelerates, global stablecoin circulation reached a record $322 billion at the end of May.

Bitcoin has long served three roles: an alternative route to US dollars, digital gold and a speculative asset. Demand for access to dollars has been an important source of support in markets with capital controls or depreciating local currencies. Ravi Tanuku, managing partner at Natural Capital, said US recognition of regulated stablecoins under the GENIUS Act provides a less volatile digital-dollar alternative, repricing bitcoin’s monetary premium.

Trump signed the GENIUS Act on July 18, 2025, requiring payment stablecoins to maintain 100% reserves in assets including US dollars and short-term US Treasuries. CoinDesk reported on May 27, 2026, that stablecoin market capitalization rose 45%, from about $211 billion in January 2025 to more than $306 billion in October. Bitcoin fell 43%, while gold outperformed it by nearly 100%.

Stablecoins use fiat currency reserves to maintain their value and have gradually become a settlement tool for payments and crypto markets. The United States enacted the GENIUS Act on July 18, 2025, generally allowing only qualified issuers to issue stablecoins domestically. The law brings reserves, redemptions, capital and oversight under a federal framework, affecting market access for banks, nonbank firms and foreign issuers.

The Office of the Comptroller of the Currency proposed rules on February 25, 2026, covering reserve assets, custody, redemptions, risk management, audits, registration and capital backing. The comment period runs through May 1. The following day, Comptroller Jonathan Gould testified before the Senate Banking Committee alongside officials from the Federal Reserve and FDIC, with stablecoins and digital assets emerging as key regulatory topics.

US President Donald Trump signed the GENIUS Act on July 18, 2025, establishing the first federal regulatory framework for payment stablecoins. The law covers issuer eligibility, reserve assets and redemption mechanisms. It takes effect on the earlier of 120 days after final rules are issued or 18 months after enactment. The consistency of rules across agencies will shape competition between banks and crypto companies.

On April 21, 2026, groups including the American Bankers Association and the Bank Policy Institute wrote to the Treasury Department, the Federal Deposit Insurance Corporation, FinCEN and OFAC. They asked the agencies to wait until the Office of the Comptroller of the Currency completes its issuer rules and then allow a comment period of at least 60 days. The banking groups said the three rules are interdependent and warned that finalizing them simultaneously could create inconsistent standards and enforcement conflicts.

Stablecoins were initially pegged to fiat currencies such as the U.S. dollar, primarily to reduce volatility in crypto trading. They have since become onchain settlement assets for DeFi, cross-border payments and tokenized markets. The International Monetary Fund says stablecoins can make cross-border payments more efficient by reducing intermediaries while extending the dollar’s influence beyond the traditional banking system.

CoinDesk reported on March 26, 2026, that World Economic Forum data showed annual stablecoin transaction volume had reached tens of trillions of dollars. U.S. President Donald Trump signed the GENIUS Act on July 18, 2025, requiring payment stablecoins to be backed 1:1 by highly liquid assets such as cash or short-term U.S. Treasuries. The law also imposes reserve disclosure, periodic audit and anti-money-laundering requirements, while issuers with more than $10 billion in assets are generally placed under federal oversight.

The US president signed the GENIUS Act on July 18, 2025, establishing the first federal regulatory framework for payment stablecoins. These tokens are typically backed by US dollar assets and used for transfers and settlement. The new regime will shape competition between banks and crypto companies, while also affecting holders’ redemption rights and the development of the dollar-based payments system.

The Office of the Comptroller of the Currency unveiled proposed rules on July 17, 2026, requiring each $1 of payment stablecoins to be backed by at least $1 in eligible reserve assets. The proposal also sets risk-management, custody and operational standards. Designed to implement the GENIUS Act, the draft must still undergo public consultation and final rulemaking.