The Fed Has Proposed What Would Have to Sit Behind a Bank's Stablecoin. Comments Close November 30.

The Federal Reserve Board has set out what it would require of a payment stablecoin issuer under its supervision. Two proposals, announced on September 24, 2026 and published in the Federal Register on September 29 under Docket No. R-1899, would build the Board's part of the framework created by the GENIUS Act. The comment period closes on November 30, 2026.

The GENIUS Act divides supervision of payment stablecoin issuers among several agencies depending on the form the issuer takes. These proposals cover the subset the Board supervises — subsidiaries of insured state member banks and state-qualified issuers that come under the Board's framework — rather than every issuer in the market.

What a payment stablecoin is, in regulatory terms

A payment stablecoin is a digital token whose issuer undertakes to redeem it at a fixed value, typically one dollar. Nothing about the token itself guarantees that. The promise holds only to the extent that the issuer is actually holding assets of equivalent value, that those assets can be sold quickly at close to their carrying value, and that the issuer is solvent enough to absorb the gap if they cannot. Reserve rules, capital rules and redemption rules each address one of those three points.

The first proposal: reserves, capital, risk management

The framework proposal would require that outstanding stablecoins be fully backed by permissible reserve assets. The categories identified at proposed section 247.11(b) include insured and uninsured deposit claims against insured depository institutions, money held in an account at a Federal Reserve Bank, money held under repurchase agreements meeting the statutory requirements, and US Treasury securities.

Capital requirements would be set by category rather than as a single ratio, under proposed sections 247.15 through 247.18:

• Credit risk capital against the reserve assets held
• Financial risk capital against non-reserve assets (section 247.17(b))
• Operational risk capital (section 247.18)
• A de novo capital requirement for newly established issuers (section 247.15(b)(2))

The proposal would also set risk-management standards, rules for the safekeeping of backing assets, and clarify which stablecoin-related activities are permissible for banks the Board supervises.

What issuers would not be allowed to do

Three prohibitions in the proposal are worth stating plainly. An issuer could not lend. It could not issue stablecoins as the proceeds of a loan. And payment stablecoins could not themselves serve as reserve assets backing other payment stablecoins.

The last of those closes a specific loop. If one issuer could back its tokens with another issuer's tokens, the system as a whole could hold far fewer real assets than the face value of coins outstanding, and a problem at one issuer would propagate directly to the others.

The second proposal: how a bank would apply

The companion proposal would create a tailored application process for Board-supervised banks seeking to issue payment stablecoins. Applicants would submit business plans and financial information, and the proposal sets out procedures for appeals, hearings and final determinations. An application route is the quieter half of a licensing regime, and often the half that decides how many entrants there are.

How to comment

Comments are due by November 30, 2026, referencing Docket No. R-1899. Submissions on Federal Reserve rulemakings are filed through the Board's own comment portal or through regulations.gov, and become part of the public record the agency must consider before issuing a final rule.