The Federal Deposit Insurance Corporation released a set of proposed rules on Monday aimed at implementing stablecoin regulations under the GENIUS Act, legislation signed into law by President Donald Trump last summer. The proposal establishes a regulatory framework for FDIC-supervised payment stablecoin issuers and banks involved in stablecoin-related activities. It covers reserve asset standards, redemption processes, capital requirements, and risk management obligations.
A central element of the proposal is the explicit exclusion of stablecoins from deposit insurance protections. Deposits held in reserve to back payment stablecoins would not be insured on a pass-through basis to token holders, meaning stablecoin users would not receive the same protections afforded to traditional bank account holders. This distinction draws a clear line between conventional deposits and digital token holdings.
The proposal also sets operational requirements for stablecoin issuers. Issuers would be required to redeem tokens within two business days of a request. Additionally, issuers would be prohibited from representing that their tokens generate interest or yield, including through arrangements made with third parties.
The rules further clarify the treatment of tokenized deposits. Where a tokenized deposit meets the statutory definition of a deposit under the Federal Deposit Insurance Act, it would receive the same treatment as any other deposit type under that law. This provision is intended to provide regulatory clarity for institutions navigating the boundary between traditional banking products and digital assets.
The GENIUS Act, which the proposed rules are designed to implement, permits payment stablecoin issuers with less than $10 billion in outstanding tokens to opt for state-level regulation, provided the relevant state meets federal standards. The Treasury Department is concurrently developing principles for assessing state regulatory frameworks, with a comment period on that effort running through June 2, 2026.
The FDIC is soliciting feedback on 144 specific questions contained within the proposal. A 60-day public comment period will begin once the proposal is published in the Federal Register. The Office of the Comptroller of the Currency had previously issued its own stablecoin regulatory framework in February, indicating a broader coordinated effort among federal financial regulators to address the growing stablecoin market.
Originally reported by Decrypt.
