The Federal Reserve Board on September 24 released two proposed rules to implement the GENIUS Act for payment stablecoin issuers, opening a 60-day public comment window once the drafts hit the Federal Register. Published at 2:30 p.m. Eastern time, the proposals would force Board-supervised issuers to fully back their tokens with permissible reserve assets at all times and set new capital and risk-management standards.

The rulemaking gives banks and existing issuers their first concrete look at how the Fed intends to supervise a market that has grown into core digital-asset plumbing. It also hands Board-supervised banks a clearer path into issuing dollar-pegged tokens, one of the central bank's most direct interventions in the stablecoin sector to date.

What would the reserve and capital rules require?

The first proposal requires Board-supervised payment stablecoin issuers to hold reserve assets whose value fully covers outstanding coins at all times. Permissible reserves include short-term Treasury bills and certain other high-quality, liquid assets.

Issuers would face additional obligations under the same draft:

• Standardized capital requirements addressing credit and operational risks of payment stablecoin activities
• Risk-management standards set out under the law
• New rules for Board-supervised firms that safekeep the assets backing payment stablecoins
• Clarification of the permissibility of stablecoin and related activities for Board-supervised banks

The reserve language effectively rules out fractional backing for Fed-supervised issuers, aligning the U.S. framework with the full-backing model already practiced by the largest dollar-pegged tokens. For custodians, the safekeeping rules create a defined supervisory perimeter around the assets that anchor token redemption.

How would banks apply to issue stablecoins?

The second proposal creates a tailored application process for Board-supervised banks seeking to issue payment stablecoins. Applicants must submit a business plan and financial information, among other documents. The draft establishes a process for appeals, hearings, and final determinations, giving banks a structured route — with recourse — into the business rather than case-by-case supervisory discretion.

The procedural detail matters operationally. A defined appeals and hearing track reduces regulatory ambiguity for bank compliance teams weighing whether to build stablecoin issuance into existing payments infrastructure or partner with non-bank issuers instead.

What context surrounds the rulemaking?

The Fed's proposals land amid a broader U.S. push to write crypto into formal regulation. Legislative proposals such as the CLARITY Act, the crypto bill that could reshape market-structure oversight, are moving in parallel with stablecoin implementation, meaning issuers face overlapping rulebooks from the Fed and Congress.

The GENIUS Act — the Guiding and Establishing National Innovation for U.S. Stablecoins Act — sets the federal framework for payment stablecoin issuance. The Fed's proposals would govern the issuers and reserve custodians that fall under its supervision, defining which firms sit inside the central bank's perimeter and which answer to other regulators or state regimes.

Internationally, regulators are moving in the same direction but with divergent methods. Central banks across Europe are pushing to restrict stablecoin activity, tightening oversight as the U.S. opens a formal licensing path — a split that cross-border issuers will have to navigate in their reserve and entity structuring.

What happens next?

The comment period closes 60 days after the proposals are published in the Federal Register. Stakeholders — banks, issuers, custodians, and industry groups — will have that window to push back on reserve eligibility, capital calibration, and the application process before the Fed moves toward final rules that will determine how quickly supervised banks can enter the stablecoin market.