- The FDIC proposed new rules to regulate stablecoin issuers under its supervision, setting standards for reserves, redemption, and risk.
- Reserve deposits backing the stablecoins would be insured, but this FDIC protection will not extend directly to individual token holders.
- The agency is soliciting public feedback for 60 days on its proposed implementation of the GENIUS Act.
The US Federal Deposit Insurance Corporation (FDIC) has moved to implement the GENIUS Act, proposing detailed rules for stablecoin issuers it supervises. Its board approved the proposal this week, nine months after the law was signed.
The rules would establish strict reserve, redemption, capital, and custody standards, according to the notice. This marks a significant step in formalizing oversight for banks issuing payment stablecoins.
However, a key clarification states that FDIC insurance will not directly protect stablecoin holders. The agency argued this aligns with the act’s prohibition on extending deposit insurance to the tokens themselves.
Consequently, only the reserve deposits held by the issuer would receive insurance coverage. The FDIC contends its rules still create a more secure environment by imposing elevated standards on issuers.
Meanwhile, the agency is actively seeking public input on 144 specific questions related to the regulations. This follows a separate December proposal for application procedures.
The Office of the Comptroller of the Currency (OCC) is also implementing the act, covering a broader scope of issuers. The GENIUS Act is scheduled to take full effect in January 2027.
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