Federal Reserve Proposes New Regulations for Stablecoin Issuers
- The US Federal Reserve Board is seeking public comment on two proposals under the GENIUS Act.
- One proposal mandates that issuers fully back their stablecoins with reserve assets like short-term Treasury bills.
- Capital requirements will be standardized to mitigate credit and operational risks, along with risk-management standards.
- The second proposal introduces an application process for banks wishing to issue payment stablecoins, requiring detailed business plans.
- No final regulations were issued by regulatory agencies before a missed deadline under the GENIUS Act, signed into law on July 18, 2025.
These proposals aim to create a comprehensive federal regulatory framework for stablecoins in the US, addressing key issues such as risk management and capital requirements. The feedback from the public will play a crucial role in shaping these regulations.
The Fed’s initiatives reflect ongoing efforts to regulate stablecoins effectively, particularly after missing a significant rule-making deadline related to the GENIUS Act.(Source)
