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Trump Signs GENIUS Act, Sets Federal Rules for Dollar-Backed Stablecoins

The legislation tasks federal agencies with drafting detailed implementing rules within six months.

Overview

  • Under the GENIUS Act, stablecoin issuers must fully back tokens with low-risk liquid assets, submit to monthly independent audits, enforce anti-money-laundering controls and forgo any interest payments.
  • Oversight of dollar-pegged stablecoins shifts to federal regulators, with the OCC supervising nonbank issuers and the Federal Reserve, FDIC and NCUA overseeing chartered institutions and empowered to freeze assets.
  • Regulators have a six-month deadline to issue implementing rules, prompting issuers to seek OCC charters or Federal Reserve approval ahead of the compliance timeline.
  • Crypto-linked stocks and token prices rallied on news of the law, signaling market optimism that the act grants stablecoins broader legitimacy in mainstream finance.
  • Major banks including JPMorgan Chase, Bank of America and Citigroup are now exploring or developing compliant stablecoin products in response to the new regulatory clarity.