Treasury Advances GENIUS Act Rules as Stablecoin Framework Takes Shape
Published Aug 17, 2026
The U.S. Treasury Department is advancing the regulatory framework behind the GENIUS Act, moving the country closer to a fully operational federal system for payment stablecoins.
Treasury Secretary Scott Bessent said the department is moving quickly to implement the law, which established the first comprehensive federal framework for dollar-pegged payment stablecoins. The broader rulemaking process will determine how issuers are licensed, supervised and held accountable as stablecoins become more deeply integrated into payments and traditional finance.
The GENIUS Act was signed into law on July 18, 2025. Its major provisions are expected to take effect on January 18, 2027, or 120 days after federal regulators issue final implementing regulations, whichever comes first.
A Federal Rulebook for Stablecoin Issuers
At the center of the GENIUS Act is a new category known as a permitted payment stablecoin issuer. Only authorized issuers will be allowed to issue payment stablecoins in the United States once the framework is fully effective, subject to limited exceptions written into the law.
Issuers will generally have to maintain reserves backing their outstanding stablecoins on a one-to-one basis. Eligible reserves can include cash, deposits at insured financial institutions, short-term U.S. Treasury securities and certain Treasury-backed repurchase agreements.
The law also requires issuers to publish redemption policies and provide regular disclosures about the composition of their reserves. These requirements are designed to give users greater confidence that a stablecoin can be redeemed at its stated value, even during periods of market stress.
Larger issuers face additional scrutiny. Under the regulatory proposals, certain issuers with more than $50 billion in outstanding stablecoins would be required to prepare annual financial statements under generally accepted accounting principles and obtain audits from registered public accounting firms.
Compliance Moves Closer to Banking Standards
Treasury’s implementation work also addresses the financial-crime risks associated with digital dollars. Proposed rules from the Financial Crimes Enforcement Network and the Office of Foreign Assets Control would subject permitted issuers to anti-money-laundering, counter-terrorist-financing and sanctions requirements tailored to stablecoin technology.
Issuers would be treated as financial institutions under the Bank Secrecy Act and would need effective compliance programs, customer-identification procedures and systems for reporting suspicious activity. They would also need technical capabilities to block, freeze or reject prohibited transactions when required by law.
That is an important distinction for the industry. Public blockchains can make transactions highly visible, but the speed, global reach and pseudonymous nature of stablecoins can also make them attractive for sanctions evasion, fraud and money laundering. Regulators are attempting to use blockchain transparency without assuming it eliminates the need for traditional compliance controls.
State and Foreign Issuers Remain Part of the Equation
The framework does not create an exclusively federal market. State-qualified issuers with no more than $10 billion in outstanding stablecoins may remain under state supervision when the state’s regulatory system is determined to be substantially similar to the federal framework.
Foreign-issued stablecoins also have a potential route into the U.S. market, but only when Treasury determines that the issuer’s home jurisdiction provides a regulatory and supervisory regime comparable to the American system. This provision will be especially important for offshore issuers seeking continued access to U.S. customers and trading platforms.
Beginning July 18, 2028, digital-asset service providers will generally be prohibited from offering payment stablecoins to U.S. users unless those assets come from permitted domestic issuers or qualifying foreign issuers.
Why This Matters for Crypto
The GENIUS Act gives stablecoins something the U.S. crypto market has lacked for years: a defined path into the regulated financial system. Clear licensing, reserve and redemption standards could encourage banks, payment companies and major technology platforms to develop new dollar-based products without relying on regulatory guesswork.
It could also increase demand for short-term government debt because approved issuers will hold significant portions of their reserves in Treasury securities and related instruments. Bessent has argued that a well-regulated dollar stablecoin market can extend the dollar’s global reach as more payments move onto digital networks.
Still, the details are not final. Multiple agencies are involved, several proposals remain in the public-comment stage and regulators missed the law’s original one-year deadline for completing the rules. For issuers and investors, the next major milestone will be the release of final regulations that turn the GENIUS Act’s broad requirements into enforceable operating standards.
The direction is now clear even if the rulebook is unfinished: stablecoins are being brought into a formal U.S. regulatory structure, and companies that want access to the American market will have to meet much more demanding standards.