Federal Reserve stablecoin regulatory framework

The Federal Reserve has proposed a regulatory framework under the GENIUS Act targeting payment stablecoin issuers supervised by the Board. The proposals would require full backing with permitted reserve assets, including short-term Treasury bills and other high-quality liquid assets, and would impose standardized capital requirements to cover credit and operational risks along with broader risk-management standards.

The Fed also proposed separate requirements for firms that safeguard stablecoin reserves and outlined a tailored application process for Board-supervised banks seeking approval to issue payment stablecoins, requiring business plans and financial documentation and establishing procedures for appeals, hearings and final decisions. The proposal builds on earlier GENIUS Act implementation work and market commentary notes it could create a more structured, potentially supportive environment for crypto products, with observers citing possible effects on Solana markets and naming actors such as Jerome Powell and the Solana Foundation as influential to implementation and reception.