FDIC Moves to Rein in Stablecoins with New Rule Proposal Under GENIUS Act
Issuers would be required to back tokens with identifiable reserve assets, redeem stablecoins generally within two business days, and meet capital and risk-management standards tailored to size and complexity.
Reserves backing stablecoins would not flow through to holders as FDIC-insured deposits, but tokenised deposits meeting the statutory definition of “deposit” would receive the same insurance treatment as traditional deposits.
The US Federal Deposit Insurance Corporation (FDIC) has voted to advance a proposed rule that would introduce reserve requirements, redemption timelines and a ban on yield for payment stablecoin issuers.
Approved by FDIC directors on April 7, the notice of proposed rulemaking sets out a regulatory framework for “permitted payment stablecoin issuers” (PPSIs) and the insured banks that hold stablecoin reserves on their behalf.
It follows a December 2025 proposal that established how insured banks can apply to issue stablecoins through subsidiaries.
New Rules And Clarifications
Under the draft, issuers would be required to hold clearly identifiable reserves backing each token and process redemption requests within two business days in most cases.
Capital and risk management obligations would vary depending on the size and complexity of the issuer, while the rule also defines which activities PPSIs are allowed to conduct.
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The proposal formalises restrictions on offering yield or interest to stablecoin holders, outlining how regulators would determine violations of the GENIUS Act’s prohibition.
This targets a growing number of issuers that have experimented with rewards-based models tied to stablecoin use.
For users, the FDIC clarified that reserves backing stablecoins would not qualify for pass-through deposit insurance. However, tokenised deposits that meet the legal definition of a deposit would continue to receive standard FDIC insurance coverage regardless of the underlying technology.
FDIC Chairman Travis Hill said the proposal aligns in several areas with a similar rule introduced by the Office of the Comptroller of the Currency in February 2026. The agency is seeking feedback on 144 questions covering areas such as capital standards, permitted activities and insurance treatment.
A 60-day public comment period will begin once the proposal is published in the Federal Register.
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Filed under: Bitcoin - @ April 8, 2026 7:18 am