Federal Reserve Board requests public comment on two proposals related to establishing a regulatory framework for Board-supervised payment stablecoin issuers under the GENIUS Act
The Federal Reserve is seeking comment on two proposals to regulate payment stablecoin issuers supervised by the Board under the GENIUS Act. The framework would set reserve, capital, risk-management and application requirements, creating a defined path for eligible banks while imposing new compliance obligations.
The Federal Reserve said September 24 that it had opened public comment on two proposals implementing its responsibilities under the GENIUS Act for Board-supervised payment stablecoin issuers.
One proposal would require issuers to fully back stablecoins with permitted reserve assets, including short-term Treasury bills and certain other high-quality liquid assets. It would also establish standardized capital requirements for credit and operational risks, set risk-management standards, regulate firms that safekeep reserve assets, and clarify which stablecoin activities are permissible for Board-supervised banks.
A separate proposal would create a tailored application process for Board-supervised banks seeking approval to issue payment stablecoins through a subsidiary. Applicants would submit a business plan, financial information and other documents; the proposal also covers appeals, hearings and final application decisions.
The comment period will close 60 days after publication in the Federal Register. The eventual rules will determine how the GENIUS Act is applied to reserve management, bank participation and operational controls, but the proposals remain subject to public input.
The Fed proposed reserve, capital and application rules for Board-supervised payment stablecoin issuers under the GENIUS Act.
The proposals create a formal route for Board-supervised banks to seek stablecoin-issuer approval, but reserve, capital and risk controls could raise the operating requirements for entrants. No single listed company is identified, so the immediate read is sector-wide and depends on the final rules after the comment period.
The final framework could materially change the proposed reserve, capital, safekeeping or application requirements before adoption.
CoverageSource: Federal Reserve · Published here THU, SEP 24 · 2:30 PM ET · 3 reports · 3 publishers in this record · latest listed: CoinDesk · THU, SEP 24 · 6:31 PM ETHow this is decided →
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A defined approval process and permissible reserve framework could make bank participation in payment stablecoins easier to evaluate and execute.
Full-reserve, capital and operational-risk requirements could increase compliance costs and narrow the field of eligible issuers.
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