The Federal Deposit Insurance Corporation (FDIC) has moved to translate the country’s first crypto bill for stablecoins, the GENIUS Act, into concrete regulatory guidance for banks and their fintech subsidiaries that wish to use or issue stablecoins.
In a notice of proposed rulemaking approved by the FDIC Board, the agency lays out “a prudential framework” for FDIC‑supervised permitted payment stablecoin issuers (PPSIs) and for insured depository institutions (IDIs) that provide custodial or safekeeping services tied to payment stablecoins.
FDIC Issues GENIUS Act Rules
The proposal addresses several core areas required under the GENIUS Act, including the composition and treatment of reserve assets, redemption mechanics, capital considerations, and enterprise‑level risk management expectations.
It also clarifies how deposit insurance will apply to funds held as reserves backing payment stablecoins: the FDIC would make clear whether pass‑through insurance applies in those circumstances.
In addition, the rule states that tokenized deposits that meet the statutory definition of “deposit” will be treated under the Federal Deposit Insurance Act the same as any other deposits, removing uncertainty about whether digital‑native forms of deposits would face different treatment.
The FDIC’s rulemaking is narrowly focused on entities subject to its supervision: subsidiaries of insured State nonmember banks and state savings associations, collectively described as FDIC‑supervised IDIs, that receive approval to issue stablecoins through a subsidiary.
Last December, the agency published a prior notice of proposed rulemaking under section 5 of the GENIUS Act to establish application procedures for such IDIs seeking approval to issue payment stablecoins.
AML Certification For Stablecoin Issuers
On capital, the FDIC is not yet prescribing a specific minimum capital amount, ratio, or an objective framework for minimum capital requirements. Instead, the agency is soliciting feedback on whether to create such a framework in future regulations.
The proposed rule would also require a permitted payment stablecoin issuer to certify that it has implemented anti‑money‑laundering (AML) and sanctions compliance programs reasonably designed to prevent the issuer from facilitating money laundering or the financing of terrorism.
The 197-page proposal further addresses technical and supervisory questions that have been a source of concern among stablecoin issuers, while leaving open some of the more complex calibration issues, like minimum capital quantification, for further consideration through the public comment process.
By proposing this package of rules, the Federal Deposit Insurance Corporation is advancing the statutory mandate under the GENIUS Act to build a federal regulatory framework for payment stablecoins.
The act requires the FDIC, alongside the other primary federal payment stablecoin regulators and the Department of the Treasury, to promulgate regulations establishing prudential standards for supervised entities that issue or materially support payment stablecoins.
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