The Federal Reserve opened a public consultation on September 24, 2026, involving two proposals that would establish requirements for payment stablecoins issued by financial institutions supervised by the U.S. central bank. The initiative addresses how banks could issue these digital assets, how their reserves should be managed and what authorization process would apply to institutions seeking to create dedicated subsidiaries.
The proposals represent another implementation step under the GENIUS Act, the federal legislation that created a regulatory framework for payment stablecoins. The consultation is relevant to banks, financial technology companies, digital asset issuers and consumers because it could help define which institutions may issue stablecoins in the United States and under what conditions.
According to the Federal Reserve, the public comment period will remain open for 60 days after the proposals are published in the Federal Register. The deadline, therefore, will be calculated from that publication rather than from the date of the central bank’s announcement.
What the proposed stablecoin rules cover
The first proposal focuses on the requirements that would apply to payment stablecoins issued by supervised financial institutions. One of its central elements is the expectation that these tokens be fully backed by permitted reserve assets. The examples identified in the proposal include short-term U.S. Treasury securities and other high-quality liquid assets.
The framework also addresses capital requirements, risk management and the institutions responsible for holding the assets that support the digital currencies. These provisions are intended to establish operational and financial safeguards around stablecoin issuance, including the management of reserves and the infrastructure used to support the tokens.
Reserve quality is a key issue for stablecoins because their design generally depends on the expectation that each token can maintain a stable value. By specifying eligible assets and placing requirements on the entities responsible for custody, the proposal seeks to create clearer standards for the backing of payment stablecoins issued by banks under Federal Reserve supervision.
Authorization process for bank subsidiaries
The second proposal would create a specific procedure for supervised banks that want to establish subsidiaries dedicated to issuing stablecoins. The process would require applicants to submit a business plan, financial information and additional documentation for review by the Federal Reserve.
The proposal also outlines procedures involving submissions, hearings and final decisions on applications. This would give banks a defined regulatory path for requesting authorization instead of treating stablecoin issuance as an activity without a dedicated approval framework.
Details of the proposed authorization process are available through the Federal Reserve’s proposal information page. Interested parties can also use the agency’s public comment form to submit feedback during the consultation period.
Potential effects on banks and digital payments
If adopted, the proposed rules could influence how banks structure stablecoin operations, manage reserves and control operational risks. Institutions interested in issuing payment stablecoins would need to evaluate their capital position, governance systems, custody arrangements and ability to meet the documentation and review requirements established by the Federal Reserve.
For financial technology companies and other digital asset businesses, the framework could clarify the role of supervised banks in the expanding digital payments market. The rules may also affect partnerships between banks and technology providers, particularly where payment products depend on a stablecoin issued by a regulated institution.
Consumers could be affected through the standards applied to reserves, redemption and operational safeguards. The proposal addresses the broader regulatory objective of allowing payment stablecoins to be used while reducing risks connected to insufficient backing, weak controls or failures in the institutions managing the supporting assets. The materials supplied by the Federal Reserve identify the importance of reserves and supervision, but the final impact will depend on the rules adopted after the public comment process.
Next steps in the consultation
The Federal Reserve’s announcement does not make the proposals final. The agency will receive comments, review the responses and proceed through the applicable regulatory process before determining the final requirements. The consultation gives banks, companies, industry groups and members of the public an opportunity to address the proposed reserve, capital, risk management and authorization provisions.
Federal Reserve Governor Michael S. Barr also issued a statement related to the regulatory framework, available through the agency’s official statement page. Until the consultation and subsequent decisions are completed, the proposals should be understood as planned rules rather than final obligations for banks issuing stablecoins in the United States.
