U.S. Treasury proposes GENIUS Act stablecoin licensing rules and foreign issuer limits

The U.S. Treasury Department has issued a notice of proposed rulemaking under the GENIUS Act that would define when payment stablecoins are considered issued, offered or sold in the United States and when domestic and foreign issuers need federal or state licenses. The draft, tied to the stablecoin law signed in July 2025, would require licenses for U.S. issuance from Jan. 18, 2027 and, from July 18, 2028, generally bar digital asset service providers from offering or selling payment stablecoins to U.S. persons unless the tokens come from a permitted payment stablecoin issuer. Treasury said it used concepts from securities law as a reference while treating stablecoins as a distinct financial instrument, and said foreign issuers would need to comply with lawful U.S. orders and reciprocal arrangements to keep accessing the market. The proposal opens a 60-day comment period through Oct. 19, 2026. Treasury Secretary Scott Bessent said the administration is moving quickly to provide regulatory certainty and "cement the role of the U.S. dollar as the world's reserve currency and keep America the crypto capital of the world." The move comes as the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation and the Federal Reserve Board, despite issuing proposed rules in 2026, missed the law's July 2026 deadline for final regulations, raising the prospect that the GENIUS Act takes effect before the full rulebook is finished. Separately, the Digital Asset Market Clarity Act, which would revise parts of the stablecoin law including rules for rewards programs, has stalled in Congress after failing to clear key August votes.