FDIC Advances Rulemaking For GENIUS Act: New Framework For Stablecoin Issuers

The Federal Deposit Insurance Corporation (FDIC) is developing regulatory guidance for banks and their fintech subsidiaries regarding stablecoins. This guidance stems from the nation's first crypto bill, the GENIUS Act. The proposed rule establishes a prudential framework for stablecoin issuers and institutions providing related custodial services. Key areas addressed include reserve asset composition, redemption processes, capital considerations, and risk management. The FDIC will clarify how deposit insurance applies to funds held as reserves for stablecoins. Tokenized deposits that meet the statutory definition of "deposit" will be treated the same as traditional deposits. This rulemaking specifically targets entities supervised by the FDIC that wish to issue stablecoins through subsidiaries. The agency is seeking feedback on establishing a minimum capital framework for issuers. Permitted stablecoin issuers will also need to certify their anti-money laundering and sanctions compliance programs. The proposal addresses technical and supervisory concerns, with more complex issues like capital quantification open for public comment. Ultimately, the FDIC aims to fulfill its mandate under the GENIUS Act by creating a federal regulatory structure for payment stablecoins.