FDIC proposes rules for stablecoin issuers under GENIUS Act

The U.S. Federal Deposit Insurance Corporation (FDIC) has held a board meeting to discuss the implementation of the GENIUS Act, a proposed stablecoin regulation, CoinDesk reported. Under the act, the FDIC, which supervises U.S. depository institutions, would also be tasked with regulating institutions that issue stablecoins through their subsidiaries. To this end, the agency has proposed capital, liquidity, and custody standards for these firms, though the details will not be finalized until a final rule is established. The proposal confirms that stablecoins would not be eligible for the depositor protection benefits that banks provide for traditional deposits. It also includes requirements for capital that issuers must maintain to manage business risks and operational safeguards based on the previous year's operating expenses. The FDIC will collect public feedback on the 144 items in its proposal for 60 days before making revisions and finalizing the regulation.