Fed proposes new capital, redemption rules for stablecoin issuers — SkimNews
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- The Federal Reserve proposed capital requirements for stablecoin issuers under its supervision to implement the GENIUS Act, including an operational-risk capital charge of 2% on the first $20 billion outstanding, 1.5% on the next $30 billion, and 1% on amounts above $50 billion.
- Stablecoin issuers would be required to process redemptions within two business days, and must notify the Fed and either restore reserves under a remediation plan or liquidate if reserves fall below the required one-to-one backing.
- Issuers would face new monthly disclosure requirements detailing outstanding stablecoins and the value and composition of their reserves, with reports examined by a registered public accounting firm and certified by the issuer's CEO and CFO.
- Fed-supervised banks seeking to issue payment stablecoins through subsidiaries would face a separate application process requiring business plans and financial information submissions.
- Fed Governor Michael Barr supported the proposal but warned that "stablecoins will only be stable if they can be reliably and promptly redeemed at par in a range of conditions," including during market stress when pressure can hit even liquid government debt.
- Barr also raised concerns about a standard that would prevent the Fed from taking supervisory or enforcement action over an anti-money-laundering deficiency unless the issue is considered "significant or systemic."
- The proposals are open for public comment for 60 days after publication in the Federal Register; the GENIUS Act takes effect Jan. 18, 2027, or 120 days after federal regulators issue final implementing rules, whichever comes first.
Why it matters: Stablecoin issuers now face a tiered capital charge scaling from 2% to 1% depending on outstanding value, mandatory two-day redemptions, and CEO/CFO-certified monthly reserve disclosures — a concrete compliance regime that adds cost to the largest issuers and gives the Fed explicit authority to force liquidation if reserves slip below 1:1 backing.
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