FDIC Proposes Stablecoin Oversight Framework Under GENIUS Act

The Federal Deposit Insurance Corporation board unanimously approved a proposed regulatory framework on April 7, 2026, implementing the GENIUS Act for stablecoin oversight under Chairman Travis Hill. The proposal requires FDIC-supervised bank-affiliated stablecoin issuers to fully back stablecoins with approved assets, limit no more than 40% of reserves with a single custodian, complete redemptions within two business days, and report reserves monthly. Critically, the framework prohibits issuers from claiming stablecoins as FDIC-insured and bans paying yield to customers, though firms may submit written rebuttals to the yield restriction. The proposal follows the OCC's March 2026 GENIUS Act rule and accompanies simultaneous FDIC actions on anti-money laundering deregulation and reputational risk removal, reflecting the administration's broader deregulatory agenda. The framework enters a 60-day comment period while a separate December 2025 rule on stablecoin application processes remains open for comment until May 18, 2026.

FDIC's Stablecoin Regulatory Framework Under GENIUS Act

• ▪The Office of the Comptroller of the Currency released a GENIUS Act rule in March 2026.
• ▪The Federal Deposit Insurance Corporation board proposed a regulatory framework implementing the GENIUS Act on April 7, 2026.
• ▪The FDIC board in December 2025 proposed a rule setting the process for FDIC-supervised banks to apply to issue payment-stablecoins through subsidiaries.
• ▪No more than 40% of stablecoin reserves may be held with a single custodian under the FDIC's proposed GENIUS Act framework.
• ▪Travis Hill is chairman of the Federal Deposit Insurance Corporation as of April 2026.
• ▪The FDIC in February 2026 extended the comment period for the December 2025 stablecoin application process rule to May 18, 2026.

Anti-Money Laundering Requirements Rollback

• ▪The FDIC's anti-money laundering proposal is in line with the Financial Crimes Enforcement Network's proposal issued on April 7, 2026.
• ▪Scott Bessent is Secretary of the Treasury as of April 2026.

Finalization of Reputational Risk Removal from Bank Supervision

• ▪Jonathan Gould is Comptroller of the Currency as of April 2026.

Perspective of Bank-affiliated stablecoin issuers

• ▪The 40% single custodian limit for stablecoin reserves forces bank-affiliated issuers to establish relationships with multiple custody providers.

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