GENIUS Act Sets Federal Rulemaking for Stablecoins and Crypto Banking

Congress enacted the GENIUS Act in July 2025 to create a federal framework for payment stablecoins issued by insured banks and a new class of qualified nonbanks. The law set a deadline for agency rulemaking and placed issuance under prudential supervision. Federal agencies are defining specific, risk-based rules that determine who may operate and under what terms. Interagency rules will specify capital, liquidity, permissible reserve assets, governance, and examination programs for stablecoin issuers under a statutory timetable. FinCEN is preparing AML guidance that maps customer due diligence, monitoring, sanctions screening, and the Travel Rule across wallets and intermediaries. The FDIC outlined application procedures for bank issuance subsidiaries requiring business plans, technology architectures, third-party risk assessments, and recovery and resolution planning. The OCC clarified permitted digital-asset activities for national banks, confirmed limited principal activity for blockchain fees and testing, and continued to issue national trust charters for custody and settlement services under federal supervision. Examiners will focus on program design, controls, capital and liquidity sizing, and operational resilience and will scale requirements to activity complexity and size. Reserve rules will require cash and short-term instruments to support par redemption and timely settlement and will require daily reconciliation, valuation standards, segregation, and independent attestation. Governance expectations will call for board oversight, senior management responsibility, and independent risk functions that oversee issuance, reserves, and redemption mechanics. FinCEN's AML guidance will require programs that combine transaction surveillance with on-chain analytics to detect mixing, obfuscation, and evasion across custodial and noncustodial models, and Travel Rule compliance will extend to cross-chain transfers through message standards and interoperable solutions. The FDIC's application track will require end-to-end redemption mechanics, vendor contracts, cybersecurity controls, and contingency plans for wallet outages or reserve shortfalls, and interagency coordination will limit duplicative requests and establish a post-approval examination cadence. OCC trust charters will preempt state-by-state fragmentation for custody and settlement and create a single federal supervisory channel for multistate firms. Interagency stablecoin rules are due by July 18, 2026, with phased compliance dates through January 2027, and many institutions are running pilots to collect exam evidence and harden operations ahead of final rules. Banks should finalize product governance, attestation workflows, third-party risk programs, and recovery plans; fintechs should evaluate trust charter pathways and deepen bank partnerships; product and compliance teams should align vendor onboarding, testing, and documentation timelines; and firms should monitor reserve eligibility definitions, redemption mechanics, and the scope of examinations that will validate controls and reporting. 

Source: https://web3businessnews.com/policy/crypto-banking-federal-integration/

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