US regulators missed the deadline to implement the GENIUS Act - ForkLog

# U.S. regulators miss the deadline to implement the GENIUS Act

U.S. agencies did not issue final rules by July 18 for the stablecoin law — the GENIUS Act. The provisions of the document set aside exactly one year for this task from the date of signing

The law instructed financial regulators — the Office of the Comptroller of the Currency (OCC), the Federal Reserve System (Fed), the Federal Deposit Insurance Corporation (FDIC) and the National Credit Union Administration (NCUA) — and the Treasury Department to develop implementing rules.

By the set date, the responsible parties published only draft documents and opened comment windows, but they still did not release the final provisions

Still in development

In March, the OCC published in the Federal Register an extensive proposal to implement the GENIUS Act, covering reserve assets, capital, liquidity, custody of securities, risk management, reporting, and other requirements for “stablecoin” issuers.

In April, the FDIC put forward an initiative on prudential standards covering reserves, capital, redemption, custody, and risk management. The proposal also addresses deposit insurance with respect to stablecoin reserves and tokenized deposits.

In February, the NCUA published potential rules on licensing, and in May — a broader document on operational management and risk management. Comments for the second package closed only on July 17.

State-level regulatory principles from the Treasury Department also remain unfinished. The document is supposed to define when the state regulatory framework is “substantially similar” to the federal regime.

At the end of June, the Fed, FinCEN, OCC, FDIC and NCUA jointly issued a customer identification proposal requiring issuers to verify sources of funds and maintain corresponding documentation. Comments are accepted until August 21

A separate FDIC document regarding compliance with the Bank Secrecy Act and sanctions also remains open.

What’s next?

Based on the structure of U.S. bureaucracy, at least several of the submitted rules are unlikely to be adopted by the end of the current year. At the same time, before completing the work, the agencies also need to take into account numerous comments from industry representatives.

The missed deadline by itself does not delay the date the GENIUS Act takes effect, however, legislators need to work on the CLARITY Act in parallel

Under the provisions, the law takes effect either on January 18, 2027 (18 months after enactment) or 120 days after the primary federal regulators issue final rules on its implementation

At the same time, Congress did not provide for penalties or alternative deadlines if the agencies fail to complete the development of these rules on time

Recall that in June, the American Bankers Association, the Independent Community Bankers of America, and 76 regional associations urged the Senate to clarify the CLARITY Act provisions on stablecoin yield.