FDIC to Implement US Stablecoin Rule Framework This Month, Acting Chair Says

The Federal Deposit Insurance Corporation is preparing to rotation retired a ceremonial regularisation model for US stablecoins aboriginal this month, according to acting seat Travis Hill.

Key Takeaways:

• The Federal Deposit Insurance Corporation volition people its archetypal US stablecoin regularisation model aboriginal this month.

• The GENIUS Act makes the FDIC the main regulator for bank-issued stablecoins, with different agencies overseeing the remainder of the market.

• New capital, liquidity, and reserve rules volition beryllium introduced alongside guidance connected tokenized deposits.

In prepared grounds for a House Financial Services Committee hearing, Hill said the bureau has begun drafting rules to instrumentality the instrumentality and expects to people a connection outlining however stablecoin issuers volition use for approval.

He added that a abstracted connection mounting retired prudential standards for issuers overseen by the FDIC is planned for aboriginal adjacent year.

The GENIUS Act, signed into instrumentality successful July by President Donald Trump, created a multi-agency oversight operation for dollar-backed stablecoins.

Under the legislation, the FDIC volition supervise the stablecoin-issuing subsidiaries of the banks and firms it already regulates, portion different agencies instrumentality work for antithetic corners of the market.

Hill said the FDIC’s occupation volition spell good beyond paperwork. The bureau is tasked with defining superior requirements, liquidity rules and diversification standards for reserve assets, measures aimed astatine ensuring that issuers tin conscionable redemptions adjacent during marketplace stress.

Like different national regulators, the FDIC volition people its connection for nationalist remark earlier finalizing it, a process that often takes months arsenic agencies sift done manufacture feedback and, if necessary, revise their approach.

The Treasury Department has already moved up connected its broadside of the law.

Officials began their ain GENIUS Act implementation enactment successful August and precocious closed a 2nd nationalist consultation connected however non-bank issuers volition beryllium supervised, creating a parallel way of rulemaking that volition signifier the full US stablecoin landscape.

Hill besides revealed that the bureau is moving connected guidance covering tokenized deposits, echoing recommendations published successful July by the President’s Working Group connected Digital Asset Markets.

The study urged regulators to clarify which blockchain-based activities are permissible for banks, including the issuance of integer representations of deposits.

The FDIC, helium said, is preparing guidance to spell retired however tokenized deposits should beryllium treated nether existing banking rules, an country that has drawn increasing involvement from lenders experimenting with blockchain infrastructure for payments and settlement.