Fed proposes reserve limits and capital standards for stablecoin issuers
Fed proposes stablecoin reserve and capital rules
On Thursday, the Federal Reserve proposed new rules for payment stablecoin issuers. A stablecoin is a crypto token designed to hold a steady value, usually tied to the U.S. dollar.
The proposal would require issuers to fully back their stablecoins with short-term Treasury bills or other highly liquid assets. It would also create standardized capital requirements and standards for managing risks, and set up a specific application process for board-supervised banks that want to apply to issue stablecoins.
The central bank is working to implement the GENIUS Act, the Guiding and Establishing National Innovation for U.S. Stablecoins Act, which President Donald Trump signed into law last year.
What the proposal covers
- Payment stablecoin issuers would have to fully back their tokens with short-term Treasury bills or other highly liquid assets.
- The Fed proposed standardized capital requirements.
- The Fed proposed standards for managing risks.
- Board-supervised banks that want to issue stablecoins would go through a new, specific application process.
Barr supports the plan but raises money laundering concerns
Federal Reserve Governor Michael Barr said he supported the latest proposal. He has previously raised concerns about the GENIUS Act.
Barr said he wanted to see more done around bank anti-money laundering rules. He said he wants a standard that would prevent the Board from taking a supervisory or enforcement action related to an anti-money laundering deficiency unless the issue is a "significant or systemic" issue.
Barr said he is concerned that the "significant or systemic" standard "may have unknown effects on the Board's ability to effectively substantiate that an institution establishes and maintains compliant programs," adding that this was also the case with the Board's July proposal.
Deadlines and effective date
An initial deadline for the rules was set for July, but the source notes that agencies often take longer to implement new rules.
The GENIUS Act has a January 2027 effective date. The law creates a federal regulatory framework for stablecoins, including a requirement that stablecoins be fully backed by U.S. dollars or similarly liquid assets, plus mandatory annual audits.
What is confirmed
- The Federal Reserve proposed the new measures on Thursday, September 24, 2026.
- The proposal covers reserve-asset limits, standardized capital requirements and a new application process for board-supervised banks.
- Barr said he supported the proposal and separately raised concerns about anti-money laundering oversight.
- The GENIUS Act was signed into law last year and takes effect in January 2027.
What is still unclear
The sources do not say when the proposal would be finalized, nor do they describe the full details of the capital and risk standards. Barr's concern about the "significant or systemic" standard, which he said may have unknown effects, has not been resolved in the supplied material.
Why it matters
The proposal is another step by the Federal Reserve toward putting the federal stablecoin law into practice. Under the law, stablecoin issuers face a federal framework that includes full backing with dollars or similarly liquid assets and annual audits. The Fed's proposal sets out how reserve holdings, capital and risk management would be handled for issuers it supervises.
Sources
Newisty Editorial Team covers technology, cryptocurrency, digital products, online platforms, developer tools and the wider digital economy. Our content is researched from official sources, company announcements, public documentation, market data and other primary or reputable sources. Articles are reviewed and edited before publication for clarity, accuracy and useful context.