The Federal Reserve proposed rules to implement the GENIUS Act, requiring payment stablecoin issuers to fully back tokens with short-term Treasury bills or other highly liquid assets. The proposals would establish standardized capital and risk-management requirements, create an application process for Board-supervised banks seeking to issue stablecoins and set standards for firms safeguarding reserves. The law, signed by President Donald Trump last year, also requires dollar or similarly liquid backing and annual audits, with an effective date in January 2027. Federal Reserve Governor Michael Barr supported the proposal but urged stronger safeguards around bank anti-money-laundering supervision, including a standard limiting enforcement action to significant or systemic deficiencies.