The Federal Reserve has proposed regulations to implement the GENIUS Act, focusing on stablecoin yield programs.
By Jesse Hamilton|Edited by Nikhilesh De31 minutes ago3 min readMake preferred on ShareShare this articleCopy linkX (Twitter)LinkedInFacebookEmailMake preferred on The U.S. Federal Reserve has outlined key proposals for regulating stablecoin issuers. (Jesse Hamilton/CoinDesk)SummaryShow- The Federal Reserve has introduced two significant proposals aimed at implementing the GENIUS Act, joining other federal bodies in the ongoing effort to finalize stablecoin regulations.
- One proposal addresses contentious stablecoin rewards, aligning with suggestions from the Office of the Comptroller of the Currency.
On Thursday, the U.S. Federal Reserve unveiled two regulatory proposals intended to fulfill its obligations under the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act.
These proposals, now available for a 60-day public comment period, aim to create a legal framework for the issuance of stablecoins and establish protocols for banks regulated by the Fed to issue such tokens. The GENIUS Act mandates that U.S. banking regulators and the Treasury Department implement these regulations by July 2026; while this deadline has been surpassed, notable progress has been made recently.
The Fed's regulatory stance also reflects the Office of the Comptroller of the Currency's earlier proposal, which dealt with the law's prohibition on issuers providing interest or yield on stablecoin holdings.
The Fed stated, "Certain arrangements involving third parties would be presumed to be prohibited payments of interest or yield," indicating that its approach aligns with the OCC's. While these regulations are not yet finalized, they seem to permit a constrained framework for crypto platforms to offer stablecoin rewards similar to credit card incentives.
The extent to which companies like Coinbase can incentivize stablecoin users was a contentious issue during discussions surrounding the failed Digital Asset Market Clarity Act. Currently, the GENIUS Act serves as the primary legislation governing stablecoin rewards, following unsuccessful attempts to amend it through the Clarity Act.
Before the Fed can finalize the proposed regulations, they must undergo a public consultation process—typically a lengthy endeavor.
The Fed's first proposal focuses on capital and reserve requirements designed to ensure that stablecoins are backed by highly liquid assets and that issuers are well-prepared for financial stress. This proposal also details acceptable stablecoin activities for banks under its supervision and includes the stablecoin rewards aspect.
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State of CryptoExploring the intersection of cryptocurrency and regulation.PreviewSign upBy signing up, you will receive emails about CoinDesk products and you agree to our terms & conditions and privacy policy.The second proposal outlines the process for regulated banks to issue their own stablecoins, which includes submitting a "business plan, financial information, and relevant policies, procedures, and other documents."
Fed Governor Michael Barr, who previously oversaw the Fed's supervision program, emphasized, "Stablecoins will only be stable if they can be reliably and promptly redeemed at par under various conditions," in a statement. He added that this stability is crucial during market stress when even highly liquid government debt may face pressure.
Last month, the Treasury Department put forth its own proposals to implement the GENIUS Act, defining what it means to issue U.S. stablecoins and outlining compliance requirements. The Federal Deposit Insurance Corporation initiated the regulatory process in December, marking the first federal entity to advance its part of the law. In June, multiple agencies proposed that stablecoin issuers must identify their users similarly to other regulated financial institutions.
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The Definitive Stablecoin Landscape Series: Asia Pacific
The Definitive Stablecoin Landscape Series: Asia Pacific
As stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases, and RLUSD’s role.
By CoinDesk ResearchSep 15, 2026Commissioned byRippleAs stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases, and RLUSD’s role.
Why it matters:
As stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases, and RLUSD’s role.
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