The US Federal Deposit Insurance Corporation (FDIC) has formally proposed its approach to regulating stablecoin issuers, as required by the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act. The proposal, which aligns with the Office of the Comptroller of the Currency's (OCC) proposal in February, will be open for public comment for 60 days. The FDIC's role is to regulate US depository institutions that issue stablecoins from their subsidiaries, and the proposal sets out capital, liquidity, and custody standards for these firms.
However, the details will not be finalized until the agency has reviewed input and written the final language. The proposal also clarifies that stablecoins will not be eligible for deposit insurance, and issuers will not be able to offer interest or yield on their tokens simply for holding or using a payment stablecoin. The FDIC's proposal suggests that issuers will need to maintain capital to manage the risk of their business, as well as an operational backstop. The agency has also addressed the applicability of pass-through insurance to deposits held as reserves backing payment stablecoins.
While regulators work to implement the GENIUS Act, lawmakers are still debating the details of the Digital Asset Market Clarity Act, which could potentially overhaul some of the GENIUS Act's provisions.