The U.S. Treasury has proposed new rules defining when payment stablecoins are issued, offered, or sold in the United States as regulators prepare for key GENIUS Act restrictions beginning in January 2027.
Summary
- Treasury has proposed rules defining when payment stablecoins are issued, offered or sold in the United States.
- Stablecoin issuers will generally need a federal or state license when the GENIUS Act takes effect in January 2027.
- Foreign issued stablecoins will face separate requirements before digital asset service providers can make them available to U.S. users.
- The proposal is open for public comment for 60 days after publication in the Federal Register.
The U.S. Treasury Department said on Aug. 17 that its Notice of Proposed Rulemaking focuses on Section 3 of the Guiding and Establishing National Innovation for U.S. Stablecoins Act, opening another public comment process as the government works through the law’s remaining implementation requirements.
Under the proposal, Treasury would set the boundaries for what qualifies as issuing a payment stablecoin “in the United States,” a distinction that determines when an issuer must obtain a federal or state license under the GENIUS Act.
The department is also seeking to define when a digital asset company is considered to have offered or sold a payment stablecoin to a person in the United States. Treasury said the definitions are intended to give companies more certainty over when U.S. licensing and distribution restrictions apply.
Treasury Secretary Scott Bessent said the department was moving to implement the framework established by President Donald Trump and Congress while seeking feedback from companies and other stakeholders.
Bessent said the rules were intended to provide businesses with “regulatory certainty” while supporting U.S. innovation and maintaining the dollar’s position as the global reserve currency.
GENIUS Act rules would determine which issuers need licenses
Starting Jan. 18, 2027, the expected effective date of the GENIUS Act, companies generally will not be allowed to issue payment stablecoins in the United States unless they hold an appropriate federal or state license, according to Treasury.
Treasury’s latest proposal centers on determining when an issuer’s activities fall within that U.S. requirement. How the agency defines domestic issuance could determine which companies must obtain authorization before continuing to issue stablecoins accessible to U.S. customers.
The licensing requirements form one part of the federal stablecoin regime created after Trump signed the GENIUS Act into law on July 18, 2025. The legislation established separate paths for federally supervised issuers and qualifying state-regulated issuers while introducing reserve, redemption, compliance and disclosure requirements.
Regulators have spent much of 2026 developing the rules needed to put the law into operation.
The Office of the Comptroller of the Currency outlined its proposed framework in February, covering reserve assets, redemptions, capital, liquidity, custody, risk management and supervision for issuers falling under the agency’s authority. The proposal also included procedures covering applications and the wind-down of stablecoin operations.
Separate rulemaking has dealt with state oversight. In April, crypto.news reported on Treasury’s proposal for determining whether state regulatory systems are sufficiently similar to the federal framework. Under that process, issuers with less than $10 billion in circulation could remain under qualifying state supervision if the state regime meets federal standards.
Foreign stablecoins face separate U.S. restrictions
Foreign-issued stablecoins also fall within the latest proposal, with Treasury working to establish how tokens issued outside the country can continue to reach U.S. users.
Under the GENIUS Act, digital asset service providers generally cannot offer, sell or otherwise make a foreign-issued payment stablecoin available unless its issuer can comply with lawful orders and meets requirements tied to reciprocal arrangements between the United States and the issuer’s home jurisdiction, Treasury said.
The legislation gives Treasury a role in determining whether foreign stablecoin regulatory systems are comparable to U.S. requirements. Foreign issuers operating under qualifying regimes can gain access to the U.S. market if they also satisfy conditions imposed by the law.
Another restriction takes effect later. From July 18, 2028, digital asset service providers generally will not be permitted to offer or sell payment stablecoins to people in the United States unless the tokens were issued by a licensed issuer, according to Treasury.
Treasury’s proposed definitions of “offer or sell” and a person “in the United States” therefore affect exchanges, trading platforms and other digital asset businesses that make stablecoins accessible to American customers.
The agency previously sought industry views on many of the same jurisdictional questions through an Advance Notice of Proposed Rulemaking issued in September 2025. The latest proposal moves that process forward by setting out Treasury’s planned implementation of the Section 3 restrictions.
Treasury rule follows other GENIUS Act compliance proposals
Compliance requirements for licensed issuers have been developing separately from the rules governing where stablecoins may be issued and sold.
Treasury proposed AML rules earlier this year that would place permitted payment stablecoin issuers under Bank Secrecy Act requirements and require anti-money laundering, counter-terrorism financing and sanctions compliance systems.
Under that proposal, issuers would need systems capable of identifying suspicious activity and taking required action against transactions, including blocking, freezing or rejecting them when applicable. Companies would also need a designated U.S.-based person responsible for their compliance systems.
Federal regulators have separately proposed customer identification requirements, while bank regulators have been developing standards covering reserves, capital, redemptions, custody and operational controls.
The rulemaking process has taken longer than the timetable originally set by Congress. Federal regulators missed the July deadline for completing key GENIUS Act regulations, with several packages still in proposed form when the July 18, 2026 deadline passed.
The OCC’s main framework remained unfinished at the time, while Federal Deposit Insurance Corporation rules covering issuers linked to FDIC-supervised banks were also still moving through the regulatory process. Customer identification, anti-money laundering and sanctions proposals had not been completed either.
Missing the one-year rulemaking deadline did not automatically delay the law’s expected Jan. 18, 2027 effective date. As a result, prospective issuers have continued preparing for licensing, reserve management, redemption, customer verification and compliance requirements while regulators complete the remaining rules.
Treasury opens 60-day comment period on stablecoin proposal
For the Section 3 proposal released Aug. 17, Treasury is asking issuers, digital asset service providers and other interested parties to submit feedback on how the restrictions should operate in practice.
The rulemaking focuses specifically on the geographic and transactional boundaries that determine whether stablecoin activity falls under U.S. law, including when issuance occurs domestically and when a sale or offer is made to someone in the country.
Treasury said public comments could address issues raised by the proposed framework and would be considered before the regulations are finalized.
Members of the public will have 60 days from publication of the notice in the Federal Register to submit comments, and responses filed during the consultation will be publicly available through the federal rulemaking system.
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