Fed Proposes Framework for FRB-Supervised Stablecoin Issuers Under GENIUS Act
Link: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20260924a.htm
The Federal Reserve Board (FRB) has requested public comment on two proposals related to establishing a regulatory framework for Board-supervised payment stablecoin issuers under the GENIUS Act.
“The first proposal would require that Board-supervised payment stablecoin issuers fully back their stablecoins with certain permissible reserve assets, such as short-term Treasury bills and certain other high-quality, liquid assets. The proposal would also establish standardized capital requirements to address certain credit and operational risks of payment stablecoin activities, as well as risk management standards, in accordance with the law. Separately, the proposal would introduce rules for Board-supervised firms that safekeep the assets backing payment stablecoins. It would also clarify the permissibility of stablecoin and related activities for Board-supervised banks.
“The second proposal would establish a tailored application process for Board-supervised banks applying to issue payment stablecoins. These applicants would be required to submit a business plan and financial information, among other documents. The proposal would also create a process governing appeals, hearings, and final determinations for applications.”
Why It Matters:
Signed into law on July 18, 2025, the GENIUS Act created the first U.S. federal regulatory framework for payment stablecoins. The new proposals outline operating rules for FRB-supervised institutions under the Act. Under the proposals, reserve assets would have to equal or exceed the value of outstanding stablecoins at all times and be segregated from other issuer assets.
Legislation Proposed to Narrow CFPB Authorities
The Ballard Spahr article summarizes and discusses proposed H.R. 10184, which would make sweeping changes to the Consumer Financial Protection Bureau’s (CFPB) structure, funding, rulemaking, supervision, enforcement, and other authorities. The bill would place the CFPB under the congressional appropriations process. It is currently funded directly through the Federal Reserve, subject to statutory limits.
Why It Matters:
The bill would place the CFPB under the congressional appropriations process. It would also make clear that nonconformity with CFPB guidance may not be used to establish a violation of applicable law and establish a new retrospective review process for CFPB rulemaking led by the Office of Management and Budget (OMB) that could mandate modifications and suspension of enforcement pending revision. Given the short time until Congress adjourns, it’s unlikely to pass this session, and its future is likely dependent upon who controls the House next session.
