Catenaa, Wednesday, April 08, 2026-The U.S. Treasury Department issued a notice of proposed rulemaking on Wednesday to implement key provisions of the GENIUS Act, the law passed last summer creating a federal framework for stablecoin issuance.
The proposal seeks public comment on standards for determining whether state-level regulatory regimes for smaller stablecoin issuers align closely with federal requirements. The 60-day comment period opens immediately.
The draft rule focuses on smaller stablecoin issuers with less than $10 billion in circulating assets. If a state framework meets Treasury’s “substantially similar” standard, these firms may opt for state oversight rather than full federal supervision.
Core principles outlined include maintaining 1:1 reserve backing, enforcing anti-money-laundering compliance, and publishing monthly reserve disclosures. States are expected to match or exceed these protections while allowing flexibility to address local regulatory priorities.
The initiative represents Treasury’s first formal effort to operationalize the GENIUS Act. Regulators intend to provide clarity on how federal and state oversight can coexist and coordinate. Large issuers exceeding the $10 billion threshold will remain under mandatory federal supervision. Guidance also complements parallel rulemaking by the Office of the Comptroller of the Currency, which oversees federally regulated payment stablecoin activities and custody operations.
The move addresses uncertainty that has clouded stablecoin issuance since the law’s enactment. By defining parameters for state supervision, smaller issuers may access regulatory pathways without the immediate costs of federal compliance. Treasury’s proposal could strengthen investor protections, encourage market stability, and foster competition among compliant issuers.
Legal experts emphasize that clarifying the “substantially similar” standard is critical to avoiding a fragmented patchwork of state rules.
Stablecoin market participants have expressed cautious optimism, noting that the framework may support innovation while preserving reserve security and financial integrity.
Some stakeholders have flagged yield-bearing stablecoins as an area requiring future guidance, as these instruments are not fully addressed in the current proposal.
Public comments received during the 60-day period will inform the Treasury’s final rules. Regulators will review submissions, revise the proposal if needed, and coordinate with the OCC and other agencies before implementation.
The Treasury’s action signals a turning point in U.S. digital asset policy, balancing market growth, innovation, and systemic risk.
