Treasury has opened the first GENIUS Act rulemaking, proposing principles for state stablecoin oversight and a $10 billion issuer threshold.
Treasury has opened the first GENIUS Act rulemaking, proposing principles for state stablecoin oversight and a $10 billion issuer threshold.
The U.S. Department of the Treasury on April 1, 2026 published the first proposed regulation under the GENIUS Act, launching a formal rulemaking process that would define how state-level stablecoin oversight is measured against federal standards. The action is a notice of proposed rulemaking, not a completed framework, and targets a specific question: which state regimes qualify as “substantially similar” to the federal baseline for supervising smaller payment stablecoin issuers.
Treasury’s notice of proposed rulemaking would establish broad-based principles for evaluating whether a state-level regulatory regime for payment stablecoins meets the standard set by the federal framework under the GENIUS Act. The proposal is narrower than the headline suggests: it does not finalize stablecoin oversight rules but opens a public comment process on the criteria for state-regime approval.
The distinction matters. Some coverage has framed this as Treasury “implementing” the GENIUS Act in full. In practice, the April 1 action is the first formal step in a longer rulemaking process, with comments due 60 days after Federal Register publication.
WHAT TO KNOW
The GENIUS Act itself was signed into law on July 18, 2025, establishing a comprehensive regulatory framework for payment stablecoins. The legislation passed both chambers of Congress with wide bipartisan margins and set initial guardrails and consumer protections for the stablecoin market.
The proposal centers on a specific threshold: payment stablecoin issuers with no more than $10 billion in consolidated outstanding issuance may opt for state-level regulation rather than federal supervision, provided their state’s regime passes the substantially similar test.
That $10 billion line separates smaller, state-qualified issuers from larger ones that would fall under direct federal oversight. For companies issuing stablecoins below that threshold, the practical question is whether their home state’s regulatory framework will be certified as meeting federal standards, a consideration that ties into broader concerns about stablecoin reserve distribution requirements across the industry.
Treasury chairs the Stablecoin Certification Review Committee referenced in the GENIUS Act, which plays a central role in evaluating state regimes. The broader law also assigns licensing, supervision, and examination responsibilities to the Federal Reserve, FDIC, NCUA, and OCC.
This NPRM builds on an earlier advance notice of proposed rulemaking that Treasury published on September 19, 2025. That initial consultation gathered broad input on GENIUS Act implementation, while the current proposal narrows the focus to the state-regime equivalence question.
The rulemaking will determine the regulatory path for a significant portion of the stablecoin market. Issuers below the $10 billion threshold operating under approved state regimes would avoid direct federal supervision, creating a two-track system that could shape where stablecoin companies choose to incorporate.
Industry groups have already signaled that the outcome matters. Kenneth E. Bentsen, Jr., president and CEO of SIFMA, commented on Treasury’s stablecoin work:
“Treasury’s approach to stablecoin regulation will shape the foundation of the future digital financial system.”
Kenneth E. Bentsen, Jr., SIFMA President and CEO, via SIFMA
The regulatory clarity this process aims to provide could also affect how traditional financial institutions approach the stablecoin market. Several firms have already been positioning for a clearer framework, including Ripple’s push for a federal banking charter tied to its RLUSD stablecoin. The outcome may also influence how institutional players allocate capital, at a time when even firms like Strategy have been actively adjusting their crypto treasury positions.
For now, the NPRM remains a proposal. The 60-day comment period will give issuers, state regulators, and industry participants an opportunity to weigh in before Treasury finalizes any rules. The broader GENIUS Act implementation, covering federal licensing, reserve requirements, and supervision for larger issuers, remains a separate and ongoing process.
Treasury’s September 2025 advance notice and the April 2026 NPRM together mark the first concrete regulatory steps since the law’s enactment. The next milestone is whether Treasury adjusts the proposed principles based on public comments or moves toward a final rule that locks in the state-regime evaluation framework.
Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency and digital asset markets carry significant risk. Always do your own research before making decisions.
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