September 24, 2026

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

WASHINGTON — The Federal Reserve Board on Thursday officially opened the floor for public feedback on two major regulatory proposals designed to establish a comprehensive oversight framework for payment stablecoin issuers operating under the supervision of the Board pursuant to the GENIUS Act.

The move marks a significant step forward in the federal regulation of digital assets, aiming to bring greater clarity, safety, and institutional rigor to the rapidly expanding market for payment stablecoins. Released at 2:30 p.m. EDT, the dual proposals seek to address critical aspects of financial stability, consumer protection, risk management, and institutional participation within the evolving digital currency landscape.

Under the statutory framework of the GENIUS Act, the central bank is tasked with ensuring that payment stablecoins—digital tokens pegged to the value of fiat currency, typically the U.S. dollar—are managed with the same safety and soundness expected of traditional financial instruments. The regulatory architecture proposed by the Board on Thursday is divided into two distinct components, each targeting a specific facet of stablecoin issuance, custody, and institutional integration.

The first of the two proposals focuses heavily on the operational safety, asset backing, and risk management practices of Board-supervised payment stablecoin issuers. According to the text of the proposal, issuers under the Board’s supervision would be strictly required to fully back their circulating payment stablecoins with specific permissible reserve assets. These designated assets would primarily include short-term Treasury bills and other select high-quality, liquid assets that can be rapidly converted into cash without significant loss of value, thereby ensuring that issuers maintain perpetual redemption parity for token holders even during periods of severe financial market stress.

In addition to stringent reserve backing, this first proposal would establish standardized capital requirements explicitly tailored to address the unique credit and operational risks associated with payment stablecoin activities. The digital asset ecosystem, while innovative, presents distinct technological, cyber, and operational challenges that differ from traditional banking operations. The proposed rules would implement rigorous risk management standards mandated by the underlying legislation, ensuring that issuers maintain robust internal controls, operational resilience, and financial cushions to absorb potential shocks.

Furthermore, this initial proposal addresses the crucial function of asset safekeeping. It introduces comprehensive rules specifically designed for Board-supervised firms that hold and safeguard the underlying assets backing payment stablecoins. The integrity of custody arrangements is paramount in the digital asset sector, and these rules are intended to protect reserve assets from insolvency risks or institutional mismanagement. Simultaneously, the proposal aims to clarify the legal and regulatory permissibility of stablecoins and related digital asset activities for traditional banks operating under Board supervision, providing much-needed clarity for financial institutions seeking to engage with the digital token ecosystem.

The second proposal shifts its focus toward the institutional application process, outlining a tailored framework for Board-supervised banks that wish to enter the market as issuers of payment stablecoins. Rather than subjecting prospective issuers to a nebulous or generalized authorization process, this second proposal establishes a formalized, structured pathway for banks seeking approval.

Applicants under this tailored process would be mandated to submit comprehensive documentation, including a detailed business plan outlining their operational strategy, risk mitigation procedures, and projected market impact, alongside exhaustive financial information and other necessary administrative documents. This rigorous vetting process is designed to ensure that any banking institution venturing into stablecoin issuance possesses the requisite financial strength, technical infrastructure, and managerial expertise to manage the associated responsibilities safely.

To ensure fairness and administrative due process, the second proposal also establishes a clear and transparent governance process governing appeals, formal hearings, and final determinations regarding stablecoin applications. This mechanism provides applicants with a structured recourse should their initial submissions face challenges or rejections, balancing regulatory caution with administrative transparency.

The release of these two proposals initiates a formal public consultation period, offering industry stakeholders, consumer advocacy groups, financial institutions, academics, and members of the public an opportunity to weigh in on the structure and impact of the nascent regulatory regime. The comment period will officially close 60 days following the formal publication of the proposals in the Federal Register.

The Federal Reserve Board has indicated that media organizations and interested parties seeking further information regarding the proposals or the submission process can direct their inquiries to the Board’s media relations office via email at [email protected] or by contacting the communications staff directly at (202) 452-2955.

Last Update: September 29, 2026