September 24, 2026
For release at 2:30 p.m. EDT
WASHINGTON—The Federal Reserve Board took a significant step on Thursday toward integrating digital assets into the traditional financial system by requesting public comment on two comprehensive proposals. The initiatives are designed to establish a robust regulatory framework for Board-supervised payment stablecoin issuers, acting under the authority of the GENIUS Act.
The announcement, released mid-afternoon from Washington, marks a pivotal moment in the ongoing oversight of digital currencies. As stablecoins—digital tokens typically pegged to the value of fiat currency, most commonly the U.S. dollar—become an increasingly prominent component of the modern financial landscape, regulatory bodies are actively seeking to establish guardrails that protect consumers, maintain financial stability, and mitigate potential systemic risks.
The first of the two proposals focuses heavily on the operational safety, asset backing, and risk management standards required of institutions that issue payment stablecoins under the supervision of the Federal Reserve Board. According to the details released by the central bank, this proposal would mandate that Board-supervised payment stablecoin issuers fully back their digital tokens with specific permissible reserve assets. These assets would be restricted to low-risk, highly liquid financial instruments, such as short-term Treasury bills and other comparable high-quality, liquid assets designed to ensure that issuers can meet redemption demands at any time without triggering market disruptions.
Beyond asset-backing mandates, the first proposal would establish standardized capital requirements tailored to address specific credit and operational risks associated with payment stablecoin activities. In strict accordance with the law, these capital buffers are intended to absorb unexpected losses and ensure the continuous, uninterrupted operation of stablecoin networks even during periods of broader financial market stress. Furthermore, the proposal outlines comprehensive risk management standards that issuers must adopt to safeguard their operations against technological failures, cybersecurity threats, and liquidity crunches.
In a related measure within the same proposal, the Federal Reserve introduced specific rules governing Board-supervised firms that act as custodians, safekeeping the underlying assets that back payment stablecoins. Custodial safety has long been a paramount concern for regulators and market participants alike, and these rules are designed to ensure clear legal separation and protection of reserve assets from the broader liabilities of the custodian. Additionally, the proposal aims to clarify the precise permissibility of stablecoin issuance and related activities for traditional banks operating under Board supervision, providing much-needed regulatory clarity for institutions looking to bridge traditional banking and digital finance.
The second proposal released by the Federal Reserve Board addresses the structural gateway for financial institutions seeking to enter the stablecoin market. It would establish a tailored application process specifically for Board-supervised banks that intend to apply to issue payment stablecoins. Under this framework, prospective issuers would not be subjected to ambiguous guidelines; instead, they would be required to submit a comprehensive business plan, detailed financial information, and various other supporting documents to demonstrate their operational readiness, financial capacity, and risk management capabilities.
To ensure fairness, transparency, and due process, the second proposal would also institute a formal process governing appeals, hearings, and final determinations for these applications. This structured pathway is intended to provide applicants with a clear understanding of how their submissions will be evaluated, reviewed, and adjudicated by regulatory authorities.
The release of these two proposals initiates a standard public feedback period, allowing industry participants, consumer advocates, financial institutions, technology developers, and other interested stakeholders to weigh in on the regulatory design. The Federal Reserve Board has confirmed that the public comment period will close precisely 60 days following the official publication of the proposals in the Federal Register. Regulators typically use this feedback to refine rules, address unforeseen compliance challenges, and ensure that the final regulatory framework balances innovation with necessary systemic safeguards.
As the digital asset sector continues to evolve alongside traditional banking infrastructure, the implementation of the GENIUS Act framework represents a critical milestone. The Federal Reserve’s active posture reflects a broader international and domestic push to bring digital payment tokens under formal supervisory perimeters, ensuring they operate with the same safety, soundness, and transparency expected of traditional financial instruments.
For media inquiries regarding the proposals, the Federal Reserve Board has directed interested parties to email [email protected] or call (202) 452-2955.
Last Update: September 29, 2026
