US Federal Deposit Insurance Corp. has rolled out the first official draft rules stemming from the new law governing stablecoin issuers, with the board voting on Tuesday to open a 60-day public comment period on its system for handling applications from its regulated banks seeking to issue stablecoins from subsidiaries.
The agency — led by Acting Chairman Travis Hill, who is also President Donald Trump’s nominee for the permanent seat — will gather comments and review them before releasing a final rule. Tuesday’s proposal, approved by all three members of the shorthanded board, would establish the procedures for accepting applications, review them during a 120-day approval window and offer an appeals process for those rejected.
“Under the proposal, the FDIC will adopt a tailored application process that will enable the FDIC to evaluate the safety and soundness of an applicant’s proposed activities based on the statutory factors while minimizing the regulatory burden on applicants,” said Hill, whose nomination could be confirmed as soon as this week by the Senate.
The Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act was the first major crypto law approved by Congress, and it laid out a complex set of regulators for companies looking to issue stablecoins, the dollar-pegged tokens essential to transactions in the digital asset sector. For insured depository institutions, the FDIC is the assigned regulator.
Hill said another, more substantial rule will emerge “in the coming months” that will set forth the FDIC’s capital, liquidity and risk management requirements for such issuers.
Under the proposed application process, interested institutions would be required to submit letters describing their businesses, including financial information and their plans to operate a safe and stable issuance.
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