On July 18, 2025 President Donald Trump signed into law the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act), providing the first comprehensive federal framework in the United States for payment stablecoins. Payment stablecoins are digital assets designed to maintain a stable value, generally pegged to the value of one U.S. Dollar (USD). They are mainly used for payment purposes or settlement of transactions and can be redeemed for a fixed dollar amount on demand. The intention underlying the GENIUS Act is to provide clarity and consumer protection to an industry that has experienced tremendous growth, and for providing financial stability. The GENIUS act was signed into law on July 18, 2025 and as of late February 2026 all regulators are currently working on implementing it via proposed rules. The Office of the Comptroller of the Currency (OCC) has played a leading role in implementing the new law, publishing their notice of proposed rulemaking (NPRM) on February 25, 2026, which contains a thorough discussion of the proposed rules in a 376-page document. The FDIC, NCUA, and OCC have been working on rules around stablecoins transactions as they pertain to regulatory relationships, which require developing specific rules that implement the general guidance established by the statute.The three main goals of this effort are to increase transparency in reserve funds due to past historical events; eliminate risk associated with traditional payments and deposits; and ensure that the strength of the dollar continues to be at a very high level relative to the rest of the world’s currencies in the digital finance marketplace. This information was provided by the Administration of President Biden, in a Fact Sheet published on July 18, 2025, titled "GENIUS Act, Overview of Key Goals: 100% Reserves, Monthly Disclosure and Consumer Recovery Systems for Deceptive Representations."<h2>Core Requirements Under the GENIUS Act</h2>The law limits the potential issuers of “payment stablecoins” to the ones defined in the law and to those fulfilled the defined categories of issuers (subsidiaries of insured depository institutions (banks or credit unions), federally qualified and nonbank issuers directly licensed by the OCC, and state qualified, i.e. compliant to the state regimes, with a maximum issuance level as defined ($10 billion) for state-regulated pathways). Every payment stablecoin is required to be backed by high-quality liquid assets that must equal 100% of the amount issued; hence, cash, US dollars held at an insured depository institution, and liquid short-term treasury obligations qualify as sufficient backing for a stablecoin. In order to establish trust and prevent adverse management, each issuer must publicly report their reserve balances on a monthly basis as well as the composition of their reserves. The law states that issuers cannot claim a stablecoin is FDIC insured, government guarteed, or a legal means of payment. The law will also typically exclude compliant stablecoins from regulation as a security or commodity and will alleviate overlapping regulations by both the SEC and CFTC. To be redeemed, the redeemable must be redeemed at the earliest opportunity and at the par value. Holders of the redeemable instruments will have the first claim to repay their debts and make a full recovery in the case of insolvency. For the complete bill as prepared, please refer to Congress.gov.<img src="https://jid.rerrkvifj.com/media/customer/creatorSystem/024d3932-51b6-4274-b196-c079edbc8e71.jpeg"> The Figure above outlines the permissible categories of issuers under the GENIUS Act and the rules applicable to the backing of core reserves for each category of issuer.(Source: OCC Bulletin 2026-3, February 25, 2026)<h2>OCC’s February 2026 Proposed Rulemaking in Detail</h2>The OCC’s Notice of Proposed Rulemaking (NPRM) was issued on February 25th, 2026. This document implements the statutory requirements for all entities regulated by the OCC, including national banks, federally chartered nonbanks, select state chartered banks and foreign firms. The NPRM includes 376 pages of proposals addressing issues such as: <ol><li data-list="bullet">Minimum capital requirements, including a $5 million minimum capital requirement for new (or "de novo") issuers;</li><li data-list="bullet">Liquidity and reserves; </li><li data-list="bullet">Governance, risk management and custody; </li><li data-list="bullet">Operational resilience and backstop provisions; </li></ol> A flashpoint in the proposal is the express prohibition on directly paying "interest or yield" in connection with a stablecoin under the GENIUS Act. The OCC proposes that there be a rebuttable presumption that any arrangement with an affiliate or third party that results in an indirect yield related to the holding of a stablecoin violates the prohibition — targeted examples being the indirect yield models utilized on digital asset platforms such as Coinbase or Circle; Additionally, the OCC is considering a proposal to limit each issuer to one issued stablecoin, as well as a proposal to ban the creation of "stablecoin as a service" solutions (e.g., Paxos and Anchorage Digital) in response to concerns in the banking industry regarding outflows of deposits.Comments can be made up to 60 days following Federal Register publication. The entire NPRM has been published in OCC Bulletin 2026-3. Here is a chart from the NPRM regarding the capital floor, liquidity standards, and rebuttable presumption of yield prohibition for StableCoin issuers per OCC Notice of Proposed Rulemaking, February 2026.<h2>FDIC, NCUA, and the Multi-Agency Implementation</h2><h3>The GENIUS Act distributes oversight:</h3>In December 2025, the FDIC proposed to allow supervised institutions to create establishments that can make stablecoins available. As a result of requests from the industry, the comment period was extended to May 18, 2026 from February 17, 2026. The FDIC will be issuing prudential (capital) rules and liquidity rules in the future. See notice for extension from FDIC. The National Credit Union Administration issued rules that govern credit unions as issuers; these rules will take effect in February 2026; comments can be submitted until April 13, 2026. The U.S Treasury Department is in the process of implementing both the implementing regulations mentioned above as well as developing and issuing other regulations to assist in complying with the BSA, AML, and OFAC sanctions. The time plan set out is for implementation of the GENIUS Act is implementation will occur by 2027, but as proposed the enactment would be in July 2025, major proposals will be submitted before 2/26 and will be in effect no later than January 2027.<h2>Industry Reactions, Challenges, and Future Outlook</h2>Supporters of the framework say that it could solidify the dominance of the US dollar because stablecoins currently have a value equivalent to that of the U.S. Treasury and can facilitate global transactions quickly and at low cost. Banks have also called for safeguards to prevent deposit flight and the risk of collapse. Crypto advocates are concerned about the limits on yields that banks will be allowed to offer as this may negatively affect the reward model used by many cryptocurrencies and banking services that use fiat currencies. These discussions relate to the CLARITY Act, which is currently going through negotiations within the Senate to provide a definition for all digital assets. 2026 is poised to see a significant shift with your proposals becoming recommendations, increased testing for compliance, and a more developing regulated and innovative stablecoin market in the U.S. A positive move towards using stablecoins as methods of payment/transfer of funds and gaining access to institutional funding can reduce previous issues associated with these products. Original sources for this document include the GENIUS Act found via Congress.gov; OCC Bulletin 2026-3; FDIC extension notice, White House Fact Sheet dated July 2025, and news articles written by Bloomberg and Pymnts on developments from February 2026. These items will continue evolving and it is advisable to frequently review their respective official websites to see updates.

The GENIUS Act, signed July 2025 by Trump, creates US stablecoin framework: 100% reserves in cash/Treasuries, limited issuers (banks/OCC/state), no yields. OCC NPRM Feb 2026 details rules.

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