Approval Requirements for Issuance of Payment Stablecoins by Subsidiaries of FDIC-Supervised Insured Depository Institutions

FEDERAL DEPOSIT INSURANCE CORPORATION <CFR>12 CFR Part 303</CFR> <RIN>RIN 3064-AG20</RIN> <SUBJECT>Approval Requirements for Issuance of Payment Stablecoins by Subsidiaries of FDIC-Supervised Insured Depository Institutions</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Federal Deposit Insurance Corporation. <HD SOURCE="HED">ACTION:</HD> Notice of proposed rulemaking. <SUM> <HD SOURCE="HED">SUMMARY:</HD> The Federal Deposit Insurance Corporation (FDIC) is soliciting comments on a proposal that would establish procedures to be followed by an insured State nonmember bank or State savings association (each, an FDIC-supervised institution) that seeks to obtain FDIC approval to issue payment stablecoins through a subsidiary pursuant to the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act). </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> Comments must be received by the FDIC no later than February 17, 2026. </EFFDATE> <HD SOURCE="HED">ADDRESSES:</HD> You may submit comments, identified by RIN 3064-AG20, by any of the following methods: • <E T="03">FDIC Website: https://www.fdic.gov/federal-register-publications.</E> Follow instructions for submitting comments on the agency website. • <E T="03">Email: Comments@fdic.gov.</E> Include RIN 3064-AG20 in the subject line of the message. • <E T="03">Mail:</E> Jennifer M. Jones, Deputy Executive Secretary, Attention: Comments—RIN 3064-AG20, Federal Deposit Insurance Corporation, 550 17th Street NW, Washington, DC 20429. • <E T="03">Hand Delivery to FDIC:</E> Comments may be hand-delivered to the guard station at the rear of the 550 17th Street NW building (located on F Street) on business days between 7 a.m. and 5 p.m. • <E T="03">Public Inspection:</E> Comments received, including any personal information provided, may be posted without change to <E T="03">https://www.fdic.gov/federal-register-publications.</E> Commenters should submit only information that the commenter wishes to make available publicly. The FDIC may review, redact, or refrain from posting all or any portion of any comment that it may deem to be inappropriate for publication, such as irrelevant or obscene material. The FDIC may post only a single representative example of identical or substantially identical comments, and in such cases will generally identify the number of identical or substantially identical comments represented by the posted example. All comments that have been redacted, as well as those that have not been posted, that contain comments on the merits of the proposed rule will be retained in the public comment file and will be considered as required under all applicable laws. All comments may be accessible under the Freedom of Information Act. This proposal, all comments received, and a summary of not more than 100 words of the proposed rule pursuant to the Providing Accountability Through Transparency Act of 2023 are available at <E T="03">https://www.fdic.gov/federal-register-publications.</E> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Alfred L. Seivold, Acting Senior Deputy Director, (415) 808-8248, <E T="03">aseivold@fdic.gov,</E> Division of Complex Institution Supervision and Resolution; Sandra Macias, Acting Associate Director, (202) 898-3642, <E T="03">smacias@fdic.gov,</E> Division of Risk Management Supervision; Nicholas Simons, Counsel, (202) 898-6785, <E T="03">nsimons@fdic.gov;</E> Chantal Hernandez, Counsel, (202) 898-7388, <E T="03">chhernandez@fdic.gov;</E> Eugene Frenkel, Fin-Tech Counsel, (202) 898-3578, <E T="03">yfrenkel@fdic.gov,</E> Legal Division. </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">I. Policy Objectives</HD> The FDIC is issuing this notice of proposed rulemaking (proposed rule) to implement certain application provisions under the GENIUS Act (or the Act). <SU>1</SU> <FTREF/> The proposed rule would establish a tailored application process for an FDIC-supervised institution to obtain approval from the FDIC to issue payment stablecoins  <SU>2</SU> <FTREF/> through a subsidiary. The FDIC seeks to evaluate the safety and soundness of an applicant's proposed activities based on consideration of statutory factors and support the responsible growth and use of digital assets and related technologies  <SU>3</SU> <FTREF/> while minimizing the regulatory burden on applicants. <FTNT> <SU>1</SU>  Public Law 119-27, 139 Stat. 419 (codified at 12 U.S.C. 5901-5916). </FTNT> <FTNT> <SU>2</SU>   <E T="03">See</E> 12 U.S.C. 5902. The GENIUS Act defines a payment stablecoin as a digital asset 1) that is, or is designed to be, used as a means of payment or settlement and 2) the issuer of which is obligated to convert, redeem, or repurchase for a fixed amount of monetary value and represents or creates the reasonable expectation that it will maintain a stable value relative to a fixed amount of monetary value. 12 U.S.C. 5901(22)(A). The GENIUS Act further provides that a payment stablecoin is not a national currency, deposit, or security. 12 U.S.C. 5901(22)(B). Stablecoins that are used or designed for other purposes, such as non-payment stablecoins, are outside the scope of this proposed rule. </FTNT> <FTNT> <SU>3</SU>   <E T="03">See</E> Executive Order 14178, Strengthening American Leadership in Digital Financial Technology, 90 FR 8647 (Jan. 31, 2025). </FTNT> <HD SOURCE="HD1">II. Background and Authority</HD> <HD SOURCE="HD2">A. GENIUS Act Overview</HD> The GENIUS Act was enacted on July 18, 2025, and will become effective on January 18, 2027, or 120 days after the date on which the primary Federal payment stablecoin regulators  <SU>4</SU> <FTREF/> issue any final implementing regulations, if earlier. <SU>5</SU> <FTREF/> This proposed rule, once finalized, will implement the Federal statutory framework for applications for issuance of payment stablecoins and related payment stablecoin activities by subsidiaries of FDIC-supervised institutions for which the FDIC is the primary Federal payment stablecoin regulator, as defined under section 2 of the Act. <SU>6</SU> <FTREF/> A subsidiary of an insured depository institution (IDI)  <SU>7</SU> <FTREF/> that has been approved to issue payment stablecoins under section 5 of the GENIUS Act is a permitted payment stablecoin issuer, or PPSI. <FTNT> <SU>4</SU>  The primary Federal payment stablecoin regulators are the FDIC, the Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System (FRB), and the National Credit Union Administration (NCUA). <E T="03">See</E> 12 U.S.C. 5901(25). </FTNT> <FTNT> <SU>5</SU>  Section 20 of the GENIUS Act, governing the effective date, is codified in the note to 12 U.S.C. 5901. </FTNT> <FTNT> <SU>6</SU>  12 U.S.C. 5901(25). </FTNT> <FTNT> <SU>7</SU>  “Insured depository institution” is defined in section 2(15) of the GENIUS Act, 12 U.S.C. 5901(15). The GENIUS Act uses the term “insured depository institution” to refer to both an insured depository institution, as defined in section 3 of the Federal Deposit Insurance Act (FDI Act) (12 U.S.C. 1813) and an insured credit union, as defined in section 101 of the Federal Credit Union Act (12 U.S.C. 1752). </FTNT> Under the GENIUS Act, subject to certain limited exceptions, only a PPSI may issue a payment stablecoin in the United States. A PPSI is a person  <SU>8</SU> <FTREF/> formed in the United States that is (1) a subsidiary of an IDI approved by its primary Federal payment stablecoin regulator; (2) a Federal qualified payment stablecoin issuer approved by the OCC; or (3) a State-qualified payment stablecoin issuer approved by its State payment stablecoin regulator. <SU>9</SU> <FTREF/> With respect to a PPSI that is a subsidiary of an IDI, the PPSI's primary Federal payment stablecoin regulator is the same as the IDI's appropriate Federal banking agency under section 3 of the Federal Deposit Insurance (FDI) Act or the National Credit Union Administration, as applicable. <SU>10</SU> <FTREF/> <FTNT> <SU>8</SU>  The GENIUS Act defines a “person” as an individual, partnership, company, corporation, association, trust, estate, cooperative organization, or other business entity, incorporated or unincorporated. 12 U.S.C. 5091(24). </FTNT> <FTNT> <SU>9</SU>   <E T="03">See</E> 12 U.S.C. 5901(23). </FTNT> <FTNT> <SU>10</SU>   <E T="03">See</E> 12 U.S.C. 5901(1), (23), (25)(A); 12 U.S.C. 5904. </FTNT> The FDIC is the appropriate Federal banking agency of each IDI that is a State-chartered insured bank that is not a member of the Federal Reserve System (State non-member bank)  <SU>11</SU> <FTREF/> and each State-chartered savings association (State savings association) (collectively, as noted above, FDIC-supervised institutions). <SU>12</SU> <FTREF/> Accordingly, an FDIC-supervised institution must obtain approval for its subsidiary PPSI from the FDIC pursuant to the GENIUS Act and, once the application is approved, the FDIC will supervise that PPSI as its primary Federal payment stablecoin regulator. <FTNT> <SU>11</SU>  The term “State nonmember bank” includes any insured State bank that is an industrial bank, industrial loan company, or other similar institution that is excluded from the definition of “bank” in section 2(c)(2)(H) of the Bank Holding Company Act (12 U.S.C. 1841(c)(2)(H)). <E T="03">See</E> FDI Act section 3(a)(2) (12 U.S.C. 1813(a)(2)); 12 CFR part 347. </FTNT> <FTNT> <SU>12</SU>   <E T="03">See</E> 12 U.S.C. 1813(q). As of September 30, 2025, the FDIC supervises approximately 2,772 insured State nonmember banks and insured State savings associations. FDIC Call Report Data, September 30, 2025. The FDIC is also the appropriate Federal banking agenc ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 74k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━