Key Takeaways
- According to Hill, the initial proposal will define the application framework for institutions seeking approval under the GENIUS Act.
- Hill also indicated the FDIC is weighing recommendations from the President’s Working Group on Digital Asset Markets.
The U.S. Federal Deposit Insurance Corporation(FDIC) is preparing to unveil the first major details of how it will enforce the GENIUS Act, with acting chair Travis Hill signaling that a formal proposal will arrive before the end of December. Hill’s remarks, prepared ahead of a House Financial Services Committee hearing, outline the agency’s timeline for building the regulatory structure that will eventually govern stablecoin issuers supervised by the FDIC.
Hill states that the initial proposal will define the application framework for institutions seeking approval under the GENIUS Act. A second proposal—expected early next year—will describe the prudential requirements for banks that issue payment stablecoins. These standards will include capital rules, liquidity obligations, and guidelines for the composition and quality of reserves.
“The FDIC has begun work to promulgate rules to implement the GENIUS Act; we expect to issue a proposed rule to establish our application framework later this month and a proposed rule to implement the GENIUS Act’s prudential requirements for FDIC-supervised payment stablecoin issuers early next year,” Hill said in his testimony.
The GENIUS Act, signed by US President Donald Trump in July, introduced a multilayered oversight regime involving federal and state agencies. Under the law, the FDIC is responsible for supervising stablecoin-issuing subsidiaries of insured institutions, while the Treasury Department and other agencies oversee non-bank issuers and additional segments of the market. The Treasury has already completed two rounds of public comment on its own implementation plan.
Before any rules take effect, agencies must release proposals for public review. Regulators then evaluate feedback before finalising the framework, a process that typically unfolds over several months and may stretch into 2026 for the stablecoin standards.
Further, Hill also indicated the FDIC is weighing recommendations from the President’s Working Group on Digital Asset Markets. Those recommendations urged regulators to clarify the activities banks may pursue in the digital asset space, including issuing tokenised liabilities. “We are also currently developing guidance to provide additional clarity with respect to the regulatory status of tokenised deposits,” Hill said.
The hearing will also feature testimony from other banking regulators. Federal Reserve Vice Chair for Supervision Michelle Bowman said the central bank is developing its own capital, liquidity, and diversification requirements for stablecoin issuers, as mandated by the GENIUS Act.
