FDIC Sets New Rules for Stablecoins Under GENIUS Act

• FDIC proposes rules requiring 1:1 reserves, daily monitoring, and strict redemption timelines for stablecoin issuers.

• Framework sets capital, liquidity, AML, and cybersecurity standards for banks issuing payment stablecoins.

• Proposal clarifies reserves lack direct deposit insurance, with a 60-day public comment period underway.

The Federal Deposit Insurance Corporation approved a proposed rule on April 7 to implement standards under the GENIUS Act. The move outlines how U.S. banks and subsidiaries may issue stablecoins. The FDIC Board introduced requirements covering reserves, redemption, and risk management, aiming to formalize oversight as stablecoin adoption grows.

Framework Targets Stablecoin Issuers

According to the FDIC, the proposal creates a prudential framework for permitted payment stablecoin issuers. These issuers operate under FDIC-supervised insured depository institutions. The rule sets expectations for reserve assets, capital planning, and enterprise risk management.

Notably, issuers must maintain stablecoin backing on a one-to-one basis with eligible assets. These include U.S. currency, insured deposits, and short-term Treasury securities. Additionally, reserves must remain separate from other operations and monitored daily.

The proposal also introduces redemption standards. Issuers must process most redemption requests within two business days. However, large withdrawals exceeding 10% in one day require regulatory notification.

Capital, Liquidity, And Compliance Rules

Alongside reserves, the FDIC outlines capital and liquidity expectations. New issuers must hold at least $5 million in capital during their first three years. Furthermore, they must maintain a liquidity buffer covering 12 months of operating expenses.

However, the agency has not finalized a broader capital framework. Instead, it is requesting feedback on future requirements. This approach leaves room for adjustment following the comment period.

The proposal also mandates anti-money laundering and sanctions compliance certifications. Issuers must demonstrate systems that prevent illicit financial activity. Additionally, cybersecurity controls and independent audits form part of the operational requirements.

Deposit Treatment And Public Feedback

The rule also clarifies how deposit insurance applies to stablecoin reserves. According to the FDIC, reserves held in banks qualify as corporate deposits, not individual holdings. Therefore, standard deposit insurance does not extend directly to stablecoin users.

However, tokenized deposits meeting legal definitions receive equal treatment under existing banking laws. This removes uncertainty around digital deposit classifications.

The proposal remains open for public comment for 60 days after Federal Register publication. Notably, this marks the FDIC’s second rulemaking under the GENIUS Act, following a December 2025 proposal on application procedures.

As regulators move forward, the framework outlines a structured approach for stablecoin issuance within the U.S. banking system.