Stablecoin rules in the US: who may issue and what backs them

Summary

– Payment stablecoin issuance in the United States is a licensed activity under the GENIUS Act, enacted July 18, 2025, and only permitted issuers may lawfully issue after the relevant compliance dates. – Four routes to permitted status exist: federally qualified non-bank issuers approved by the OCC, subsidiaries of insured depository institutions, state qualified issuers under certified state regimes, and registered foreign issuers. – Reserves must back outstanding stablecoins one to one in high-quality liquid assets, issuers publish monthly reserve composition examined by a registered accounting firm and certified by senior executives, and paying yield to holders is prohibited. – The statute takes effect on the earlier of January 18, 2027 or 120 days after final implementing rules, and the agencies missed the July 18, 2026 rulemaking deadline the law set them. – The hardest date is July 2028, after which US digital asset service providers may not offer stablecoins from non-permitted issuers, which is the provision that reaches the largest offshore tokens.

Stablecoins occupied an unusual position in American finance for a decade. They functioned as dollars, moved trillions of dollars in value, sat at the center of every crypto market, and existed under no federal statute defining what backing they required or who could supervise the entity issuing them. That ended in July 2025. The GENIUS Act made payment stablecoin issuance a licensed activity, specified what reserves must contain, mandated monthly attested disclosure, prohibited paying interest to holders, and distributed supervision across federal and state regulators. It is the first comprehensive federal crypto statute of any kind, and our dedicated page on the law covers its provisions in full. This page covers the practical position that follows from it: who may issue today, what compliance requires, where the rules stand, and what happens to the tokens that do not qualify.

What counts as a payment stablecoin

Scope determines everything, and the statutory definition is narrower than the word suggests.

A payment stablecoin is a digital asset designed for use as a means of payment or settlement, redeemable at a fixed monetary value, whose issuer represents that it will maintain a stable value relative to a fixed amount of monetary value. That captures dollar-pegged tokens used for payments and settlement.

It does not automatically capture every asset that holds a stable price. Algorithmic designs that maintain a peg through supply mechanics instead of reserves sit outside the definition and were made the subject of a study instead of regulation. Yield-bearing instruments that pay holders a return are structurally excluded, because the statute prohibits permitted issuers from paying yield, which means an instrument built to pay yield cannot be a permitted payment stablecoin. Tokenized deposits are a separate question that the FDIC’s proposed rules address directly.

The practical consequence is a three-way split in the market. Compliant payment stablecoins operate inside the framework. Yield-bearing dollar instruments operate outside it, generally as securities or as something else. And offshore tokens that meet the definition but not the requirements face the distribution deadline described below.

The four routes to permitted status

Only a permitted payment stablecoin issuer may issue, and there are four ways to become one. The choice determines the regulator, the capital treatment, and the geographic reach.

Federally qualified non-bank issuers are approved by the Office of the Comptroller of the Currency. This is the route for a standalone stablecoin company seeking federal supervision without becoming a bank, and the OCC’s proposed rules address application requirements, permissible activities, reserve treatment, redemption, risk management, and capital.

Subsidiaries of insured depository institutions issue under their parent’s federal banking regulator: the OCC for national banks, the FDIC for state non-member banks, the Federal Reserve for state member banks and holding companies, and the NCUA for credit unions.

State qualified issuers operate under state regimes certified as substantially similar to the federal framework. This preserves the state trust company and limited purpose charter routes several major issuers already use, and it is why firms holding national trust charters have nonetheless kept New York arrangements for issuance itself, a structure our OCC page covers.

Foreign issuers may register where Treasury determines their home jurisdiction’s regime comparable, subject to reciprocity arrangements.

One threshold governs movement between them. State qualified issuers exceeding $10 billion in outstanding stablecoins must transition to federal supervision, preventing the state route from becoming a permanent home for the largest issuers.

What compliance actually requires

Three obligations define the burden, and each answers a specific failure the pre-statute market produced.

Full reserve backing in liquid assets. Every outstanding token must be backed one to one by identifiable reserves held separately from operating funds, composed of currency, insured deposits, short-dated Treasury bills, Treasury-collateralized repurchase agreements, and money market funds holding those instruments. Corporate bonds, secured loans, precious metals, and digital assets do not qualify. That exclusion is the single provision that separates compliant issuers from the largest offshore one.

Monthly attested disclosure. Reserve composition is published monthly, examined by a registered public accounting firm, and certified by the issuer’s chief executive and chief financial officer. Note both the cadence and the certification: monthly instead of quarterly, with named individuals personally attesting. This is not a full audit, a distinction the industry has debated for a decade, and it is considerably more than what preceded it.

No yield to holders. Permitted issuers may not pay interest or yield on payment stablecoins. The provision was among the most heavily lobbied in the legislative process, and its effect is economic: it preserves float income for issuers while preventing stablecoins from competing with bank deposits on rate.

Beneath those sit obligations that apply regardless. Permitted issuers are treated as financial institutions under the Bank Secrecy Act, which imports the anti-money-laundering program, customer identification, sanctions screening, and reporting requirements detailed on our FinCEN page.

Where the rules stand

Here the statute and the current position diverge, and the gap matters for anyone planning against it.

The law required implementing regulations within one year of enactment, meaning July 18, 2026. That date passed. What exists is a set of proposals at different stages: the OCC issued its notice of proposed rulemaking in February 2026, published in the Federal Register in March; the FDIC’s board approved its proposal in April with comments closing in June; and Treasury and FinCEN published proposed anti-money-laundering and sanctions rules in April. Rules are also required from the Federal Reserve and the NCUA.

Proposals are not final rules. A proposal opens a comment period, after which the agency reviews submissions, revises, and issues a final rule carrying legal effect. Across five agencies with coordination requirements, that process runs long.

The effect on timing is counterintuitive and worth stating precisely. The Act takes effect on the earlier of two dates: eighteen months after enactment, meaning January 18, 2027, or 120 days after final implementing regulations. So the missed deadline does not delay the law indefinitely. If final rules never arrive, the statute takes effect in January 2027 regardless, with implementing detail incomplete. If they arrive soon, the 120-day clock could pull the date earlier.

The offshore question

The provision with the largest practical consequence does not regulate offshore issuers at all. It regulates the Americans who distribute their tokens.

After July 2028, three years from enactment, US digital asset service providers are prohibited from offering or selling payment stablecoins issued by anyone other than a permitted issuer. Exchanges, brokers, and platforms serving American customers face that restriction directly, which is a considerably more effective mechanism than attempting to regulate an entity outside US jurisdiction.

For the largest offshore token, that creates a choice with a date attached. Qualify as a foreign issuer, which requires a comparability determination for its home jurisdiction. Restructure reserves to meet the standard, which for an issuer holding meaningful positions in Bitcoin, gold, corporate bonds, and secured loans is a significant change to its economics. Or lose access to regulated American distribution.

At least one issuer has taken a fourth path, launching a separate US-regulated token through a chartered bank while the global token continues under its existing arrangements. Our reporting has examined that structure, including the scale gap between the two, and the strategic logic of building a compliant vehicle small enough that compliance costs almost nothing while the option it creates is worth a great deal if the perimeter tightens.

What holders actually get

For anyone using these instruments, the protections are specific and worth knowing precisely, because several are stronger than commonly assumed and one common assumption is wrong.

Reserve backing and disclosure. One-to-one backing in named asset classes, published monthly, examined by an accounting firm, certified by named executives. That is materially better than the attestation practices that preceded the statute.

Defined redemption rights. The framework requires clear redemption terms rather than leaving them to issuer discretion.

Priority in insolvency. The Act elevates stablecoin holders’ claims above administrative expenses, which normally rank highest under the Bankruptcy Code. Holders sit ahead of the lawyers and administrators winding up a failed issuer, which is a stronger position than an ordinary unsecured creditor.

Not deposit insurance. This is the assumption that is wrong. Permitted stablecoins are not insured deposits and holders are not covered on the tokens. The FDIC’s proposal clarifies how coverage applies to bank deposits an issuer holds as reserves, which is a different question. The super-priority provision is the actual protection.

No yield. By design. An instrument offering a return on a dollar-pegged token is either not a permitted payment stablecoin or is not operating within the framework.

Enforcement, and what happens to non-compliance

The statute is not self-policing, and the consequences of operating outside it fall into three tiers that are worth separating.

Unpermitted issuance. After the effective date, issuing a payment stablecoin in the United States without permitted status is prohibited. That is a direct statutory violation, distinct from and additional to the money transmission exposure that already attaches to handling customer funds without required registrations and licences. Unlicensed money transmission is a federal crime independent of anything crypto-specific, and our legality page treats it as one of the genuine prohibitions in American crypto law.

Distribution of non-permitted tokens. From July 2028, US digital asset service providers offering stablecoins from non-permitted issuers face the prohibition described above. This reaches exchanges, brokers, and platforms instead of issuers, and it is enforceable against entities plainly within US jurisdiction, which is the design’s principal strength.

Supervisory action against permitted issuers. Firms inside the framework are examined by their designated regulator and subject to the ordinary supervisory toolkit: findings, matters requiring attention, consent orders, civil money penalties, and in severe cases revocation. Permitted status is a relationship, not a certificate, and the same is true of the national trust charters several issuers hold.

Alongside all of it sits sanctions liability, administered separately and carrying strict liability, meaning intent is not a defence. For an issuer with the technical ability to freeze addresses, that capability is itself a compliance expectation, not an optional feature, which is why the largest issuers maintain freeze functions and use them.

The practical instruction for a business is that the framework’s obligations are cumulative with everything that already applied. Nothing in the stablecoin statute displaces the Bank Secrecy Act, state licensing, sanctions law, or securities and commodities regulation where those reach. A permitted payment stablecoin issuer is a regulated financial institution facing several supervisors at once.

Where the framework leaves gaps

An honest status page names what the statute did not settle, and three questions remain genuinely open.

Tokenized deposits. A bank deposit represented as a transferable token is not a payment stablecoin under the definition, and its treatment is the subject of proposed rules, not settled law. Because tokenized deposits could serve many of the same functions with a different regulatory profile, how they are treated determines whether banks compete with stablecoin issuers or route around the framework entirely.

Yield-bearing dollar instruments. The yield prohibition applies to permitted payment stablecoins. Instruments that pay a return on a dollar-denominated position exist and continue to grow, generally structured as securities or as something else. The framework did not regulate them; it defined itself in a way that excludes them, which is a different thing and leaves the fastest-growing adjacent category outside the perimeter.

Algorithmic designs. Endogenously collateralized stablecoins were made the subject of a study instead of rules. Nothing in the statute prohibits them, and nothing in it protects holders of them.

Each of those gaps is a place where the next legislative or rulemaking cycle will have to act, and each is currently a live commercial opportunity for firms operating just outside a framework built for the products that existed when it was drafted.

The state layer

Federal law is not the whole picture, and the state layer persists deliberately.

State qualified issuance survives, subject to certification of the state regime as substantially similar and to the $10 billion transition threshold. New York’s limited purpose trust arrangements remain in active use by major issuers precisely because that route works, and several firms holding national trust charters have kept them.

Separately, state money transmitter licensing continues to apply to businesses handling customer funds regardless of stablecoin issuance status, and our legality page maps that layer. A stablecoin issuer is frequently also a money transmitter, and the two obligations are cumulative.

The pending market-structure bill would preempt conflicting state regimes for covered assets and intermediaries, which would narrow the patchwork without eliminating it. That bill was shelved by the Senate in late July 2026, as our CLARITY Act page records, so the dual structure persists for now.

How the market reorganized

Law changes behaviour before it binds, and the stablecoin market has already restructured around a statute that does not yet apply to anyone.

The most visible response has been chartering. Firms pursued national trust bank charters through late 2025 and early 2026 to position inside federal supervision, with a wave of conditional approvals and the first final approval reaching a stablecoin issuer in July 2026, a sequence our OCC page documents. Several of those same firms simultaneously kept state trust arrangements for issuance itself, which only makes sense if you expect the state qualified route to be certified.

The second response is the two-track structure. An offshore issuer launching a separate American token through a chartered bank preserves optionality: the compliant vehicle scales if the perimeter tightens and costs almost nothing if it does not. That is a rational answer to a statute whose hardest deadline sits three years out, and it produces the odd situation of one corporate group operating two dollar tokens with opposite regulatory postures and a scale difference measured in orders of magnitude.

The third and least discussed response concerns reserve composition. A framework permitting only cash, insured deposits, short-dated Treasuries, and Treasury-collateralized instruments makes reserve strategy uniform among compliant issuers, which removes a differentiator that previously distinguished them. Issuers holding higher-yielding assets face a choice between restructuring and staying outside the perimeter, and that choice now has a date.

There is also a market-level development the framework did not cause and may accelerate. Aggregate stablecoin supply contracted in mid-2026 for the first time in years while transfer volumes reached records, a divergence suggesting the asset class is shifting from a savings instrument toward a settlement instrument. The yield prohibition points the same direction: a dollar token legally barred from paying interest competes on utility, not on rate.

What to watch

Final rules from the OCC and FDIC. Both proposals are drafted and comment periods have run. Final rules start the 120-day clock and settle the detail issuers are currently guessing at.

The Federal Reserve and NCUA rulemakings. Both are required and both are less advanced publicly. Their timing determines whether the framework arrives as a coordinated package.

State certifications. Which state regimes are determined substantially similar, and how quickly, decides whether the state route stays viable for the firms built on it.

Foreign comparability determinations. These decide the fate of offshore issuers in US markets ahead of the 2028 distribution prohibition. None has been announced for the jurisdictions where the largest offshore issuers operate.

January 18, 2027. If final rules have not issued by then, the statute takes effect on its own terms with implementing detail incomplete, which would be an unusual position for a framework of this size.

Building a compliant issuance business

For a firm assessing whether to operate inside the framework, the requirements sort into a sequence, and the order reflects how much lead time each needs.

Determine whether the product is a payment stablecoin. The definition turns on redeemability at a fixed value and a stability representation. Products at the edges, yield-bearing tokens, tokenized deposits, algorithmic designs, and instruments marketed as something other than payment tools, need specific legal analysis before any other decision. Getting this wrong invalidates everything downstream.

Choose the route, which chooses the regulator. Federal qualified issuance means an OCC application and OCC supervision. Bank subsidiary issuance means the parent’s regulator. The state route means operating under a regime that must be certified, with the $10 billion threshold forcing an eventual federal transition for anything that succeeds at scale. Application timelines differ substantially and none is fast.

Build reserve architecture before the rules finalize. Segregation, permitted asset composition, custody arrangements, and daily reconciliation are engineering problems as much as legal ones, and the proposed rules also impose obligations on institutions providing custody for reserves regardless of which regulator supervises the issuer. Retrofitting this into a live product against a running clock is materially harder than building it in.

Stand up monthly attestation. A registered public accounting firm examining reserve composition every month, with executive certification, requires an engagement, a documented methodology, and internal controls producing examinable records. Firms accustomed to quarterly or ad hoc reporting consistently underestimate this.

Layer the Bank Secrecy Act program. Permitted issuers are financial institutions under that statute, importing anti-money-laundering, customer identification, sanctions screening, and reporting obligations. Firms already registered as money services businesses have most of this; firms arriving from other directions do not.

The recurring theme is lead time. Nearly every obligation requires infrastructure taking months to build, against an effective date that arrives on the earlier of two triggers, one of which is fixed regardless of whether the rules are ready.

A closing note on how to read developments in this area over the next eighteen months, because the sequence of events is unusually predictable and most coverage will treat each step as news.

The framework’s remaining milestones are already scheduled. Final rules from five agencies, state certification determinations, foreign comparability determinations, a statutory effective date in January 2027 regardless of rulemaking progress, and a distribution prohibition in July 2028. Each will generate headlines. Almost none of them will change what a holder of a compliant stablecoin actually has, because the protections described on this page, full reserve backing, monthly attested disclosure, defined redemption, and priority in insolvency, are set by statute rather than by the rules implementing it.

What the milestones will change is who is permitted to issue and where. The interesting question through 2027 is not what compliant stablecoins look like, which is settled, but how many issuers reach compliant status, which jurisdictions receive comparability determinations, and whether the largest offshore token restructures, qualifies, or accepts losing regulated American distribution. Those are business decisions with observable outcomes, and they will be visible in charter approvals, attestation publications, and reserve composition long before they are announced.

For a reader tracking this, the single most useful habit is to check any issuer’s most recent monthly reserve report against the statute’s permitted asset list. That comparison answers, in about a minute, whether a given token is inside the framework or outside it, and it will remain the fastest available test right through the transition.

Frequently Asked Questions

Disclaimer: This page is for information and educational purposes only and does not constitute legal, financial, or investment advice. Implementing regulations remain in progress and may alter the requirements described, and obligations depend on facts specific to each business. Consult qualified counsel for specific situations. Information is accurate as of July 30, 2026.