FDIC Proposes First U.S. Stablecoin Rule Under GENIUS Act
The FDIC has issued its first rule proposal under the GENIUS Act to govern stablecoin issuer applications by insured depository institutions. This proposal marks the initial framework to regulate stablecoin issuance, featuring a 60-day public comment period for feedback.
The proposed rule outlines the application process for issuing stablecoins via subsidiaries, including acceptance of filings, a 120-day review window, and an appeal process. Institutions would be required to submit letters detailing their business plans, financial information, and strategies to ensure safe and steady stablecoin issuance.
The GENIUS Act, the first major crypto law approved by Congress, designates specific regulators for stablecoin issuance, with the FDIC assigned as the regulator for insured depository institutions. Acting Chairman Travis Hill, who leads the FDIC board and is President Trump's nominee for permanent chair awaiting Senate confirmation, helmed the release of the rule proposal.
A more substantial rule is expected to follow this preliminary proposal, which will set forth capital, liquidity, and risk management requirements for stablecoin issuers to ensure financial stability and security in the emerging digital currency space.
