Fed stablecoin proposals set reserves, capital and ID rules

On September 24, 2026, the Federal Reserve Board opened two GENIUS Act proposals for public comment, both aimed at payment stablecoin issuers it supervises. The primary Federal Reserve document covers reserve assets, capital, risk controls, custodial safeguards, and the application process for banks that want to issue stablecoins.

The first proposal would require full backing of payment stablecoins with permitted reserve assets — short-term Treasury bills and other high-quality, liquid assets. It would set standardized capital requirements for credit and operational risks, establish risk-management standards, and impose rules on Board-supervised firms that hold the backing assets in custody.

The second proposal creates a tailored application process for Board-supervised banks seeking permission to issue. Applicants submit a business plan and financial information.

Taken together, the proposals fold permissible activities and oversight into one framework, addressing the uncertainty created by the lack of comprehensive prior guidance. The Federal Reserve says the first proposal would clarify which stablecoin-related activities are permissible for Board-supervised banks; the second specifies how a bank can apply to issue.

Issuers would run bank-style identity checks on direct customers involved in issuance or redemption. But ordinary users transferring stablecoins between each other on secondary markets wouldn’t need to provide personal information to the issuer on every transfer, according to Gizmodo’s report on the proposal. The agencies’ stated position is that the GENIUS Act treats permitted payment stablecoin issuers as financial institutions under the Bank Secrecy Act, requiring an effective customer identification program — applied, under this reading, at the issuance and redemption points rather than on every hop across the chain.

FinCEN, the OCC, the Federal Reserve Board, the FDIC, and the National Credit Union Administration are named as the joint group behind the customer-identification proposal. Their filing explains the reasoning directly: pushing identification obligations onto every transfer would create a duty to collect and verify the identity of every user globally.

“Imposing an obligation where any payment stablecoin transfer could, for purposes of a [Customer Identification Program] obligation, result in a customer and account relationship with a [Permitted Payment Stablecoin Issuer] would essentially impose on PPSIs a global obligation to collect and verify identifying information of individual users. FinCEN and the Agencies assess that such a CIP obligation would be nearly impossible for PPSIs to implement and could potentially cripple the industry,” FinCEN and the Agencies wrote.

Blockchain analytics firms can already link wallet clusters to people and institutions, and stablecoin activity is heavily concentrated around centralized exchanges and regulated custodians that collect user information regardless. The report notes that context. Still, the secondary-market question isn’t closed.

Federal Reserve Governor Michael S. Barr wrote: “I remain concerned[…] that the GENIUS Act regulatory framework does not do enough so far to address the risks of illicit finance conducted through secondary market transactions in payment stablecoins.” He said he would review comments on whether parts of the customer-identification rule should extend to secondary-market activity, citing the fact that some digital-asset service providers face anti-money-laundering and counterterrorist-financing requirements in their home jurisdictions while bad actors can sidestep those restrictions when transacting in digital assets.

Eligible backing assets. Capital sized for credit and operational risk. Risk-management controls. Custody arrangements for reserves. A bank seeking to issue adds a business plan and financial information on top of that. Direct customers face identity checks at issuance and redemption; secondary-market participants don’t face a blanket issuer-level identity requirement under the current proposal.

The comment period closes 60 days after publication in the Federal Register — about 8.6 weeks, calculated as 60 ÷ 7.

The desk’s assessment is that the rules could define which issuer models can continue or enter the market at all. For direct customers, the immediate consequence is identity verification at issuance or redemption; for secondary-market users, the proposal does not impose a blanket issuer-level identity check, while banks and issuers must prepare for reserve, capital, custody and application requirements — and the final treatment of secondary-market activity is still unresolved.