The Federal Reserve has moved the GENIUS Act from statute toward operating rules for banks and payment-stablecoin issuers. In a September 24 proposal, the Board requested public comment on two rulemakings covering reserves, capital, risk management, custody and the application process for supervised banks that want subsidiaries to issue payment stablecoins.
The proposals do not create a Federal Reserve digital currency and they do not regulate Bitcoin as a stablecoin. They implement parts of the federal payment-stablecoin framework established by the GENIUS Act. Independent reporting described the action as a major implementation step for the 2025 law.
The Federal Reserve has increasingly put payments innovation on its public agenda; the new GENIUS Act proposals now turn that discussion into specific supervisory questions.
Full backing moves from principle to proposed rule
The first proposal would require Board-supervised payment-stablecoin issuers to fully back outstanding coins with permissible reserve assets. The Fed specifically identifies short-term Treasury bills and other high-quality liquid assets, while also proposing standardized capital requirements for credit and operational risks.
That reserve requirement connects directly with an earlier BitcoinVersus.tech report on how stablecoins can increase demand for U.S. Treasury bills. It also gives new context to our coverage of U.S. banks exploring stablecoin payment infrastructure: banks now have a more concrete proposed federal rulebook against which to evaluate those projects.
Banks would need an approval path
The second proposal establishes a tailored application process for an insured state member bank seeking Federal Reserve approval for a subsidiary to issue payment stablecoins. Applicants would submit a business plan and financial information, and the framework would establish procedures for appeals, hearings and final determinations.
The proposal was published in the Federal Register on September 29. The notice says comments on the bank-application framework are due November 30, 2026. That makes the current text a proposal rather than a final rule, and public comments can still affect the final framework.
An English-language policy panel featuring Federal Reserve Governor Michael Barr examines the implementation questions created by the GENIUS Act, including bank participation, systemic risk and stablecoin oversight.
Redemption and custody are central to the design
Federal Reserve Governor Michael Barr supported issuing the proposal for public comment while emphasizing reserve limitations, standardized capital and clear redemption rights. His statement also flagged questions involving interest-rate, foreign-currency and anti-money-laundering risks. Those are policy questions still being worked through rather than settled outcomes.
BitcoinVersus.tech covered the legislative foundation when the GENIUS Act advanced through Congress. More recently, Circle’s New York trust-charter expansion showed how stablecoin businesses are also adapting through state-level regulated structures.
What changes next
The practical story now shifts from whether the United States will have a federal payment-stablecoin framework to how regulators will implement it. Reserve composition, issuer capital, custody controls, redemption procedures and the approval process for bank subsidiaries can determine which business models are economical under the law.
The Federal Reserve proposal is one piece of a wider implementation process. Treasury separately proposed rules in August addressing when stablecoins are considered issued, offered or sold in the United States. The resulting system will therefore depend on multiple agencies and final rules, not a single September proposal.
For Bitcoin and the broader digital-asset market, the immediate development is regulatory infrastructure rather than a change to Bitcoin’s protocol or monetary policy. The strongest signals to watch next are the public-comment record, revisions in final rules, licensing activity and the reserve portfolios that permitted issuers ultimately maintain.
BitcoinVersus.Tech Editor’s Note: We volunteer daily to help ensure information on this platform is verifiably true. BitcoinVersus.tech reports on technology, digital assets and financial policy for informational purposes.
Follow BitcoinVersus.Tech on X for Bitcoin, mining hardware, AI infrastructure and digital-asset reporting.
Financial-information disclaimer: BitcoinVersus.tech is not a financial advisor. Nothing published here is investment, legal, tax or financial advice. This media platform reports on financial subjects purely for informational purposes.
Leave a comment