Treasury’s proposed rules under the GENIUS Act would allow U.S. exchanges and other digital-asset service providers to continue offering some foreign-issued payment stablecoins, but only if they conduct reasonable due diligence on the issuer’s ability and intent to comply with lawful U.S. orders. Providers could rely on an issuer’s representation that it can comply with orders to freeze or seize tokens where applicable, but not if they know or should know the representation is false or the issuer cannot or will not comply. Treasury says diligence must at least establish that the issuer is not subject to a public GENIUS Act prohibition on secondary trading, while also considering all reasonably available information. The proposal does not identify qualifying tokens or determine whether USDT or any other named stablecoin may remain available. The GENIUS Act’s general regime is expected to take effect on Jan. 18, 2027, unless final rules trigger an earlier date, while stricter offering limits would begin July 18, 2028. Qualifying foreign issuers would generally need comparable supervision, registration with the Office of the Comptroller of the Currency, U.S.-based reserves for customer liquidity unless a reciprocal arrangement applies, and a jurisdiction outside comprehensive U.S. sanctions or primary money laundering concern designations. Certain direct person-to-person transfers, same-parent account transfers and self-custody wallet transactions would be exempt. Treasury is seeking comments on additional diligence requirements, with submissions due Oct. 19, 2026.