US GENIUS Act proposed rules
The GENIUS Act, enacted on July 18, 2025, established the primary federal regulatory framework for payment stablecoin activities. The law directs federal agencies to issue regulations that define permissible reserve assets and operational standards for issuers. In March 2026, the OCC, Treasury, and FDIC released proposed rules to implement these statutory requirements. These proposals focus on reserve composition, redemption timelines, and the segregation of assets to protect consumers.
The proposed rules require permitted payment stablecoin issuers (PPSIs) to maintain reserves that back outstanding stablecoins on at least a one-to-one basis. Reserve assets are strictly limited to US dollars, Federal Reserve notes, and funds held at certain insured or regulated institutions. This restriction aims to eliminate exposure to volatile or illiquid assets, ensuring that stablecoins remain reliable mediums of exchange rather than speculative instruments.
Operational requirements include a mandate for PPSIs to redeem stablecoins within two business days of a request. The FDIC’s proposed rule emphasizes this redemption timeline to maintain liquidity and trust. Issuers must also implement robust internal controls and reporting mechanisms to demonstrate compliance with reserve requirements. These measures are designed to prevent the kind of liquidity crises that have affected stablecoin markets in previous years.
The regulatory landscape also includes a state-level option for non-bank issuers with fewer than $10 billion in outstanding stablecoins. These issuers may opt for state regulation if it meets federal standards, providing a path to compliance for smaller entities. However, larger issuers and bank-affiliated entities must adhere to the federal framework established by the OCC and Treasury.
The proposed rules are currently open for public comment. Stakeholders are encouraged to review the full text in the Federal Register. The final rules will determine the operational reality for stablecoin issuers in the United States. Compliance will be mandatory for any entity seeking to operate as a permitted payment stablecoin issuer under federal law.
View proposed rule text (Federal Register)
OCC Notice of Proposed Rulemaking
FDIC Notice of Proposed Rulemaking
MiCA implementation updates
The European Union’s Markets in Crypto-Assets (MiCA) regulation has moved from framework to enforcement in 2026. The regulation establishes a unified licensing regime for stablecoin issuers operating within the EU. This shift requires issuers to comply with strict reserve asset restrictions and capital adequacy requirements to maintain authorization.
Reserve assets for asset-referenced tokens and e-money tokens must now consist primarily of high-quality liquid assets. The European Securities and Markets Authority (ESMA) has clarified that these reserves must be held in segregated accounts to protect holders in the event of issuer insolvency. Issuers are prohibited from investing reserve assets in risky instruments that could jeopardize the peg.
Licensing is the primary gatekeeper for market entry. Only entities authorized by national competent authorities under MiCA can issue stablecoins denominated in EU currencies or referenced to multiple assets. Unlicensed issuers face immediate removal from EU markets. This enforcement action aims to reduce systemic risk and enhance consumer protection in the digital asset space.
USDT and USDC compliance status
The regulatory landscape for the two largest stablecoins, Tether (USDT) and USD Coin (USDC), has shifted significantly following the July 2025 passage of the GENIUS Act. This legislation established a federal framework for payment stablecoins, defining permissible reserves and restricting issuance to regulated institutions such as banks and credit unions [[src-serp-5]]. The law mandates that issuers maintain reserves backing outstanding stablecoins on a one-to-one basis, limiting those reserves to specific assets including U.S. dollars and federal reserve notes [[src-serp-4]].
USDC, issued by Circle, has positioned itself for early compliance under this new regime. Circle has historically aligned its operations with U.S. regulatory expectations, making its transition into the GENIUS Act framework more straightforward. The stablecoin’s reserve composition, which includes cash and short-dated U.S. Treasury securities, aligns closely with the act’s specified asset requirements. This alignment suggests USDC is well-prepared to operate as a permitted payment stablecoin under the new federal standards.
Tether (USDT), by contrast, faces a more complex compliance path. As the largest stablecoin by market capitalization, Tether’s historical reserve structure has drawn scrutiny from regulators. The GENIUS Act’s strict definition of permissible reserves requires Tether to adjust its holdings to meet the one-to-one backing requirement using only specified assets. While Tether has increased transparency in recent years, its full compliance with the new federal framework remains under observation. The company must demonstrate that its reserves meet the precise criteria outlined in the act to avoid potential restrictions.
In the European Union, the Markets in Crypto-Assets (MiCA) regulation continues to enforce strict reserve and transparency requirements for stablecoin issuers. Both USDT and USDC must maintain separate compliance tracks to satisfy U.S. federal standards under the GENIUS Act and EU requirements under MiCA. Issuers that fail to meet either set of standards may face exclusion from key markets. The divergence between U.S. and EU frameworks creates a dual-compliance burden for global stablecoin providers, with USDC and Tether navigating distinct regulatory pathways in each jurisdiction.
Digital euro and cross-border payments
The intersection of stablecoin regulation and central bank digital currencies (CBDCs) is reshaping the infrastructure for international transfers. While the GENIUS Act, passed by the U.S. Congress in July 2025, established a domestic regulatory framework for payment stablecoins, the Federal Reserve has analyzed the broader implications for monetary policy and cross-border efficiency [src-serp-5]. These developments occur alongside the European Central Bank’s rollout of the digital euro, creating a complex environment where private stablecoins and public digital currencies may coexist or compete.
The GENIUS Act requires permitted payment stablecoin issuers to maintain reserves backing outstanding stablecoins on at least a one-to-one basis, limiting reserve assets to specified items such as U.S. dollars and federal reserve notes [src-serp-7]. This reserve requirement aims to stabilize the private digital dollar ecosystem. However, the Federal Reserve notes that the integration of such stablecoins into cross-border payments could influence monetary policy transmission, particularly if adoption expands rapidly in jurisdictions with less robust financial oversight.
The digital euro represents the European Union’s response to the growing dominance of private digital payment methods. Designed to complement physical cash and commercial bank deposits, the digital euro seeks to ensure monetary sovereignty and payment resilience within the Eurozone. As the U.S. and EU develop their respective digital currency frameworks, the interaction between regulated stablecoins and CBDCs will likely dictate the future landscape of global liquidity and settlement efficiency.
Issuer Compliance Checklist
Issuers of payment stablecoins must align with the GENIUS Act and MiCA frameworks. The following steps outline the core requirements for US and EU compliance as of 2026.
Verify Reserve Composition
The GENIUS Act mandates that reserves backing outstanding payment stablecoins consist of specified assets, such as US dollars, Federal Reserve notes, or funds held at regulated institutions [src-serp-1]. Issuers must ensure a one-to-one backing ratio to maintain peg stability and meet federal standards.
Confirm Licensing Jurisdiction
In the US, issuers must obtain permission from the Office of the Comptroller of the Currency (OCC) or other relevant federal bodies. In the EU, entities must register as Electronic Money Institutions (EMIs) or Payment Institutions (PIs) under MiCA to operate legally across member states.
Review Redemption Timelines
Proposed rules from the FDIC require permitted payment stablecoin issuers to redeem tokens within two business days upon request [src-serp-8]. Issuers must establish automated systems to handle these redemptions efficiently to avoid regulatory penalties.
GENIUS Act and stablecoin standards
The GENIUS Act establishes a federal framework for payment stablecoins, requiring issuers to maintain reserves on a one-to-one basis with outstanding tokens. Permissible reserve assets include US dollars, Federal Reserve notes, and funds held at regulated institutions, as outlined in the Treasury’s proposed rule (SB0435) and the Federal Register notice from March 2, 2026.
Top stablecoins for 2026
Market analysis for 2026 highlights Tether (USDT) as a leading payment stablecoin due to its widespread adoption and dollar peg. While USDT remains dominant for trading volume, issuers must now comply with the stricter reserve requirements mandated by the new federal legislation.
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