FDIC Approves Landmark Proposal to Enforce GENIUS Act Standards Nationwide

The Federal Deposit Insurance Corporation (FDIC) has approved a notice of proposal to strengthen standards under the Guiding and Establishing National Innovation for U.S. Stablecoins Act. Regulators are now focusing on the operational safeguards that will manage these new activities across the banking system. 

The proposed law marks the second important rule from the FDIC since the GENIUS Act started in July 2025. The first rule, issued in December 2025, explained how state non-member banks and savings associations can issue payment stablecoins through their subsidiaries.

New FDIC Guardrails for Stablecoins 

The new regulations establish a clear framework for issuers of FDIC-supervised payment stablecoins, as well as the banks that support them. These issuers are required to fully back their stablecoins with high-quality, easily accessible, and diverse assets. They must also ensure that holders can reliably exchange their stablecoins for cash without any issues, maintaining the stablecoin’s value.

Additionally, the proposal clarifies that FDIC deposit insurance covers reserve deposits at insured banks, but this coverage is separate from the stablecoins themselves. Tokenized bank deposits are treated differently under current regulations to avoid confusion with payment stablecoins authorized by the GENIUS Act.

This distinction helps maintain consistent regulations for traditional deposit products while banks explore blockchain technology. The framework emphasizes the importance of strong governance and operational stability to ensure that the activities related to stablecoins do not compromise the safety of the overall deposit insurance system.

GENIUS Act Reshapes Digital Payments  

The GENIUS Act, which became law on July 18, 2025, establishes a federal framework for payment stablecoins. These stablecoins are issued on public blockchains and are fully backed by U.S. dollars. Only approved issuers, operating through designated bank subsidiaries, will be allowed to issue these stablecoins once the new regulations are fully implemented.

The target date for implementation is January 2027 or 120 days after regulators finalize their rules, whichever comes first. However, the FDIC’s proposal only applies to the institutions it supervises. The Office of the Comptroller of the Currency and other agencies are developing similar standards for the entities they oversee.

These new regulations mark a shift from previous cautious approaches to a more structured environment that encourages responsible innovation in digital payments. Many industry participants view this proposal as a positive step toward safely integrating stablecoin issuance within the regulated banking system under uniform federal oversight.