The Fed's September 24 proposals turn the year-old GENIUS Act from law into an operating rulebook — full reserves, a two-day redemption clock, and capital surcharges for issuers. What to watch: the 60-day comment window before final rules ahead of January 2027 enforcement.
September 25, 2026 — The U.S. Federal Reserve on September 24 proposed sweeping rules for payment stablecoin issuers it supervises, including 1:1 reserve backing, redemption within two business days, and layered capital charges. The proposals are the first concrete Fed rulebook under the GENIUS Act, the federal stablecoin law signed on July 18, 2025.
Image: Illustration of a glowing digital coin balanced on a brass scale against vault documents and a padlock, with a neoclassical bank facade behind. Credit: Red Eye Eagle News / original AI illustration.
Editor's Highlight: This is the first time the GENIUS Act gets teeth. The law's 1:1 mandate becomes a specific reserve list, a two-day redemption standard, and capital charges — plus a defined path for banks to launch their own stablecoins.
Table of Contents
- Key Facts
- What the Fed proposed on September 24
- The 1:1 reserve rule and the two-day redemption clock
- Capital charges: the price of issuing
- A defined path for banks
- From law to rulebook: the GENIUS Act timeline
- Bottom Line
- FAQ
- Sources
Key Facts
| Detail | Information |
| Announcement date | September 24, 2026 (Fed press release) |
| Rulemaking vehicle | Two notices of proposed rulemaking; 60-day comment after Federal Register publication |
| Reserve rule | 1:1 backing of outstanding stablecoins with permissible reserve assets |
| Permissible reserves | USD, Fed balances, insured deposits, Treasuries maturing within 93 days, certain Treasury-backed repos |
| Redemption standard | Published redemption policies; redemption within two business days |
| Capital charges | 2% credit-risk charge; 1–2% operational-risk charge, by issuer size |
| Bank track | Tailored application process for state member banks to issue via subsidiaries |
| Enforcement | Full GENIUS Act enforcement expected January 2027 |
What the Fed proposed on September 24
The Fed's Board of Governors in Washington, D.C. requested public comment on two notices of proposed rulemaking that would establish reserve, capital, risk-management, redemption, and bank-approval rules for Board-supervised payment stablecoin issuers under the GENIUS Act.
The comment period runs 60 days after the proposals are published in the Federal Register. The Fed has not set a calendar closing date — the clock starts at publication, not announcement.
Newsroom Focus: The Fed is writing the operating manual for a law that turns one year old next month. Issuers have known the principles since July 2025; now they are getting the exact numbers.
The 1:1 reserve rule and the two-day redemption clock
Every outstanding stablecoin must be backed 1:1 by permissible reserve assets. The Fed's list is narrow and conservative: U.S. dollars, Federal Reserve balances, insured deposits, U.S. Treasuries maturing within 93 days, and certain Treasury-backed repurchase agreements.
Issuers must also publish redemption policies and honor redemptions within no more than two business days. The proposal also sets rules for reserve custodians — the entities that actually hold the backing assets.
Analysis Note: The 93-day Treasury ceiling keeps reserves in the shortest, most liquid part of the market. Issuers cannot reach for yield with longer-dated paper — the rule trades profitability for safety.
Capital charges: the price of issuing
On top of reserves, the Fed proposes layered capital charges: a 2% credit-risk charge (applied to uninsured deposits and undercollateralized reverse repos, per Crypto Daily's read of the proposal) and an operational-risk charge of 1–2% of outstanding stablecoins, scaled by issuer size.
The layered design — reserves plus capital plus custodian rules plus a formal application process — raises compliance costs in ways that favor large, well-capitalized issuers and established banks over smaller or offshore players. That is arguably the point: the Fed wants stablecoins to behave like bank liabilities, with bank-like buffers.
A defined path for banks
The second proposal creates a tailored application process for insured state member banks to issue stablecoins through subsidiaries. Banks would submit business plans, financial information, capital-structure documents, and certifications — with defined appeals, hearings, and final-decision procedures.
Practical Takeaway: Banks now have a formal on-ramp. If the final rules land as proposed, expect the first wave of bank-issued stablecoins to follow the January 2027 enforcement date — the incumbents are being invited in.
From law to rulebook: the GENIUS Act timeline
The GENIUS Act — the federal payment-stablecoin framework — was signed on July 18, 2025, passing the Senate 68–30 and the House 308–122. It passed its one-year milestone on July 18, 2026.
Meanwhile, the follow-on Clarity Act has stalled: a cloture vote failed 49–50 on September 15, 2026, per The Crypto Times. Full GENIUS Act enforcement is expected in January 2027 — which makes the current 60-day comment window the last open door for issuers, banks, and consumer groups to shape the final rules.
| Date | Milestone |
| July 18, 2025 | GENIUS Act signed into law |
| July 18, 2026 | One-year statutory milestone |
| Sept. 15, 2026 | Clarity Act cloture fails 49–50 |
| Sept. 24, 2026 | Fed proposes issuer rules |
| ~60 days post-publication | Comment window closes |
| January 2027 | Full enforcement expected |
Bottom Line
The Fed's proposals convert the GENIUS Act's 1:1 promise into hard numbers — specific reserves, a two-day redemption clock, and capital charges — with a bank on-ramp attached. What to watch: who files comments in the 60-day window, and how much of the draft survives to the January 2027 enforcement date.
FAQ
What is the GENIUS Act?
The U.S. federal payment-stablecoin framework signed on July 18, 2025, creating national rules for compliant dollar-backed stablecoins.
Which issuers do these proposals cover?
Payment stablecoin issuers supervised by the Federal Reserve Board. Other issuers fall under different supervisors' rules.
What counts as a permissible reserve asset?
U.S. dollars, Federal Reserve balances, insured deposits, Treasuries maturing within 93 days, and certain Treasury-backed repurchase agreements.
How long is the comment period?
60 days after the proposals are published in the Federal Register. The Fed has not set a calendar closing date.
When do the rules take effect?
The proposals are not final. Full GENIUS Act enforcement is expected in January 2027.
Sources
- The Crypto Times, "Federal Reserve Proposes Stablecoin Rules Under GENIUS Act" — two proposals, 1:1 reserves, bank application process, GENIUS Act history, Clarity Act context.
- Crypto Daily UK (Darnell Whitaker), "Fed Proposes GENIUS Act Stablecoin Issuer Rules" — 93-day Treasury detail, two-day redemption standard, capital-charge percentages, comment-clock mechanics.
- CBS News, "What are stablecoins and how does the GENIUS Act regulate them?" — embedded video explainer.
- Original AI-generated illustration for Red Eye Eagle News (hero image)
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