U.S. FDIC Chief Says First Stablecoin Regulations Heading for Proposal This Month
The U.S. Federal Deposit Insurance Corp. is gearing up to propose new rules for stablecoin issuers by the end of December. Acting chief Travis Hill is set to testify before the House Financial Services Committee about the agency’s plans.
The agency’s first step will be to establish a framework for handling issuers that apply for federal oversight under the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act. This will involve setting up an application process and defining prudential requirements for FDIC-supervised payment stablecoin issuers.
The GENIUS Act envisions a collaborative effort between federal and state entities to regulate the stablecoin sector. The FDIC, as the regulator of deposit insurance and overseer of banks, will be responsible for setting capital requirements, liquidity standards, and reserves quality for stablecoin issuers.
Once the FDIC drafts its proposed rules, there will be a period for public comments before final regulations are established. The Department of the Treasury and other agencies are also working on their respective responsibilities under the GENIUS Act.
In addition to stablecoin regulation, the FDIC is developing guidance on the regulatory status of tokenized deposits in response to recommendations from the President’s Working Group on Digital Asset Markets.
The House Financial Services Committee hearing on Tuesday will cover a range of regulatory priorities, with testimony from various bank and credit union regulators. Federal Reserve Vice Chair for Supervision Michelle Bowman will discuss the central bank’s efforts to develop regulations for stablecoin issuers as required by the GENIUS Act.
Overall, the FDIC and other regulatory bodies are working to establish a comprehensive framework for overseeing stablecoin issuers and promoting innovation in the digital asset space. The upcoming rules will play a crucial role in shaping the future of stablecoin regulation in the United States.
