US Treasury Proposes GENIUS Act Stablecoin Rules and Opens 60-Day Comment Period
The Facts
- The US Treasury Department issued a notice of proposed rulemaking on Aug. 17, 2026, to implement Section 3 of the GENIUS Act.
- Section 3 of the GENIUS Act governs who may issue, offer or sell payment stablecoins in the United States.
- The proposal opens a 60-day public comment period, with Federal Register publication scheduled for Aug. 18.
- President Donald Trump signed the GENIUS Act into law on July 18, 2025.
- Beginning Jan. 18, 2027, issuing a payment stablecoin in the US without a federal or state license would be unlawful.
- Beginning July 18, 2028, digital asset service providers could not offer stablecoins to US persons unless a permitted issuer created them.
- Platforms listing foreign-issued stablecoins would have to conduct due diligence rather than rely on an issuer's assurance of compliance.
- Foreign issuers would need to show they can comply with lawful US orders, including freezing or seizing tokens, to reach US customers.
- The proposed rules would reach conduct outside the US when it involves offering or selling stablecoins to people located in the United States.
- Federal agencies missed the one-year deadline the GENIUS Act set for finalizing implementing rules, which expired in July.
- Treasury Secretary Scott Bessent said the department is 'moving quickly' to implement the stablecoin framework.
Context
What is the GENIUS Act and what does it require of stablecoin issuers?
The Guiding and Establishing National Innovation for US Stablecoins Act creates a federal framework for payment stablecoins, crypto tokens pegged to a fiat currency such as the US dollar Accounting Today. It allows banks and other permitted entities to issue stablecoins if each token is fully backed by liquid assets such as cash or short-term US Treasuries Daily Hodl,Bitcoin Magazine, with one dollar in reserves for every dollar issued Blockonomi and monthly disclosures of those reserves Bitcoin Magazine.
Why is Treasury still proposing rules if the law was passed in 2025?
US regulations typically require agencies to draft and finalize implementing rules, including a public comment period, before a statute is operational Bitcoin Magazine. Under the GENIUS Act, the law takes effect 120 days after agencies finalize rules or 18 months after passage, whichever comes first, putting the effective date at Jan. 18, 2027 Cointelegraph,Daily Hodl. Because agencies missed the July finalization deadline, the law could take effect without fully finalized regulations Cointelegraph,Blockonomi.
Who would be affected beyond stablecoin issuers?
Treasury's proposal would extend to exchanges and other digital asset service providers, potentially holding intermediaries responsible for aiding unlawful stablecoin issuance and requiring 'reasonable due diligence' on foreign issuers American Banker. Foreign issuers seeking US market access would face registration and compliance conditions, including registering with the Office of the Comptroller of the Currency Yahoo! Finance,Crypto Briefing. Treasury is also seeking comment on offshore safe harbors and an emergency mechanism to suspend the restrictions American Banker.
Where Left and Right agree, and where they split
- Where Left and Right agree
- The proposal's real force lies in the duties it places on platforms and foreign issuers, not the licensing bar itself — that is where market access is actually decided.
- Where Left and Right split
- Whether the story is about sparing ordinary users the job of vetting which stablecoin is legitimate, or about how far a permission requirement may reach before it decides who competes.
How left and right read it
A licensing requirement only protects people if it actually gates the market, so the burden belongs on issuers to prove they qualify — not on ordinary users to figure out who is legitimate. That is why the proposal's insistence that platforms conduct their own due diligence on foreign-issued stablecoins, rather than accept an issuer's assurance of compliance, matters more than any other line in it. With the licensing bar arriving in January 2027 and the permitted-issuer rule in 2028, Treasury should finish this rulemaking and enforce it.
The presumption should run toward lawful activity, with regulators justifying every new permission slip. Yet the proposal reaches beyond the issuers it licenses: platforms must run their own diligence on foreign tokens instead of taking an issuer's word, and foreign issuers must prove they can freeze or seize tokens before reaching Americans. Treasury should use the comment period to keep these obligations narrow, because gatekeeping duties decide who may compete.
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Independent coverage (36)
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