The FDIC would evaluate both the subsidiary and parent institution against safety and soundness criteria.
Stablecoin News
The Federal Deposit Insurance Corp. has released a proposed rule outlining how banks can apply to issue payment stablecoins through subsidiaries, advancing implementation of the GENIUS Act signed into law in July. The 38-page framework entered public consultation on Tuesday.
Banks would submit applications detailing subsidiary structure, proposed activities, and financial documentation, including engagement letters from registered accounting firms. The FDIC would evaluate both the subsidiary and parent institution against safety and soundness criteria.
Approved subsidiaries would operate under FDIC oversight as the primary federal regulator for stablecoin activities. Assessment factors include: ability to meet issuance standards, financial condition, management quality, and redemption policies.
The Guiding and Establishing National Innovation for U.S. Stablecoins Act establishes comprehensive federal rules for payment stablecoins. Requirements include one-to-one reserve backing with U.S. dollars or approved high-quality liquid assets.
Acting FDIC Chair Travis Hill told lawmakers earlier this month that additional proposed rules covering capital, liquidity, and risk management requirements will follow in the coming months. The framework represents the first regulatory implementation of the legislation.
President Donald Trump signed the GENIUS Act on July 18, following Senate passage in June. Senior executives from Coinbase, Circle, Robinhood, and Gemini attended the White House signing ceremony.
Treasury Secretary Scott Bessent has described the law as a mechanism to strengthen dollar liquidity globally through stablecoin infrastructure. Total stablecoin circulation has surpassed $300 billion worldwide, dominated by dollar-pegged tokens.
The FDIC's role in digital asset supervision has expanded recently, including reconsideration of reputational risk standards that previously discouraged banks from serving crypto businesses. The proposed rule aims to balance innovation with depositor protection.
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