The Federal Deposit Insurance Corporation has released its first official proposed rules under a new law governing stablecoin issuers, with its board on Tuesday voting to open a 60-day public comment period on its system for processing applications from regulated banks seeking to issue stablecoins from their subsidiaries.
The agency, led by Acting Chairman Travis Hill, who is also President Donald Trump’s nominee for permanent membership, will collect and consider comments before issuing the final rule. Tuesday’s proposal, approved by all three members of the shorthand committee, would establish a procedure to accept applications, review them under a 120-day approval period, and provide an appeals process for those denied.
“Under this proposal, the FDIC would adopt a customized application process that minimizes regulatory burden on applicants while allowing them to assess the safety and soundness of their proposed activities based on statutory factors,” Hill said, noting that his nomination could be approved by the Senate as early as this week.
The Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act was the first major crypto law approved by Congress and established complex regulations for companies wishing to issue stablecoins, dollar-pegged tokens essential to transactions in the digital asset space. For insured depository institutions, the FDIC is the designated regulator.
Hill said other, more substantive rules establishing the FDIC’s capital, liquidity and risk management requirements for such issuers will emerge “in the coming months.”
The proposed application process would require interested institutions to submit a letter explaining their business, including financial information and plans for safe and stable issuance.
Read more: U.S. Senate moves toward final vote on confirmation of crypto regulators at CFTC and FDIC
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