The U.S. Federal Deposit Insurance Corporation has proposed a new regulatory framework governing how FDIC-supervised banks can issue payment stablecoins through subsidiaries. The proposal sets out approval requirements under the recently enacted GENIUS Act and signals a more formal federal approach to stablecoin issuance by banks.
The notice of proposed rulemaking, published in the Federal Register, focuses on insured state nonmember banks and state savings associations that want to issue payment stablecoins via a dedicated subsidiary. Under the GENIUS Act, such subsidiaries become permitted payment stablecoin issuers once approved by their primary federal regulator, in this case the FDIC.
The FDIC says the aim is to support responsible innovation while prioritising safety and soundness. The agency emphasises that only approved issuers will be allowed to issue payment stablecoins in the United States, with limited exceptions defined by law.
What the FDIC will assess
Under the proposal, the FDIC would evaluate applications based on statutory factors set out in the GENIUS Act. These include whether the subsidiary has sufficient financial resources to meet reserve, liquidity and operational requirements, and whether it can comply with anti-money laundering and sanctions rules.
Payment stablecoins must be backed on a one-to-one basis by identifiable reserve assets. Issuers would also be required to publish monthly disclosures detailing reserve composition and submit certified reports reviewed by an external public accounting firm.
The proposed rule also limits what approved subsidiaries can do. Permitted activities are largely restricted to issuing and redeeming payment stablecoins, managing reserves, providing custody services related to those assets, and offering supporting digital asset services. Reuse or rehypothecation of reserve assets is generally prohibited.
Management and governance standards are another key focus. The FDIC must consider the competence, experience and integrity of directors and senior managers. Individuals with felony convictions related to financial crime, cybercrime or money laundering would disqualify an application.
Consumer protection and redemption
The FDIC will also assess whether an applicant’s redemption policy meets statutory standards. Issuers must offer clear, timely redemption procedures and disclose all fees in plain language. Changes to redemption fees would require at least seven days’ advance notice to consumers.
If the FDIC denies an application, the GENIUS Act requires the agency to provide a formal appeals process with defined timelines. A denial does not prevent a bank from submitting a new application at a later date.
The GENIUS Act was signed into law in July 2025 and is scheduled to take effect in 2027, unless regulators finalise implementing rules earlier. The FDIC proposal represents one of the first concrete steps toward operationalising that framework.
For Europe, the proposal is closely watched. It highlights how the United States is building a bank-centric model for stablecoins, contrasting with the European Union’s MiCA regime and the ECB’s push for a digital euro. As global payment systems evolve, differences in regulatory design may shape cross-border use of digital money.