The blueprint from the Federal Deposit Insurance Corp outlines how banks could receive approval to issue payment stablecoins as US regulators go from crafting laws to enforcing them.
The Federal Deposit Insurance Corp. (FDIC) is moving forward with the US GENIUS Act by coming up with a means for regulated banks to apply to issue payment stablecoins. This is a very significant first step in bringing the law’s stablecoin rules into effect.
The FDIC published a 38-page document on its website, detailing the process for approving the issuance of payment stablecoins by subsidiaries of institutions under its supervision.
Bloomberg noted that the concept needs to go through a period of public input before it can move on to the next step in the process of making rules.
The plan says that banks would have to apply to issue payment stablecoins through a subsidiary. The FDIC would then judge the parent company and its subsidiary based on the rules in the GENIUS Act. These include the institution’s ability to meet stablecoin issuance standards, its financial health, the quality of its management, its regulations for redeeming stablecoins, and other safety and soundness factors.
Once the subsidiary’s payment stablecoin activities receive approval, the FDIC assumes the primary role as the federal regulator.
The FDIC, a part of the US government, oversees member banks and safeguards bank savings. It has had a stronger say in how banks handle digital assets in the previous few years. For instance, the FDIC has contemplated the use of reputational risk to monitor banks more closely.
Washington’s long history of supporting stablecoins
In June, the Senate enacted the GENIUS Act, which stands for Guiding and Establishing National Innovation for US Stablecoins. In the next month, Donald Trump, the President of the United States, signed it into law.
The law lays out a comprehensive set of requirements for stablecoins used for payments. For instance, it specifies that issuers must maintain one-to-one reserves in US dollars or other recognised high-quality liquid assets.
The GENIUS Act made a lot of people in the bitcoin business very happy. When President Donald Trump signed the bill, top executives from significant companies including Coinbase, Circle, Robinhood, and Gemini were there.
Some in the industry believe the law will make the US dollar more liquid and widely used globally via stablecoins. The Secretary of the Treasury, Scott Bessent, concurs with this plan.
There are now more than $300 billion worth of stablecoins in use around the world. The majority of these stablecoins rely on the US dollar.