FDIC Proposes GENIUS Act Rules: How Do They Compare to the OCC Proposal?
On April 9, 2026, the Federal Deposit Insurance Corporation (“FDIC”) issued a Notice of Proposed Rulemaking (the “FDIC Proposal”) to implement the Guiding and Establishing National Innovation for U.S. Stablecoins Act (the “GENIUS Act”) for the issuance of payment stablecoins and certain related activities by entities subject to the FDIC’s jurisdiction.
The FDIC Proposal generally tracks a similar proposal that the Office of the Comptroller of the Currency (“OCC”) issued earlier this year for entities subject to OCC regulation (the “OCC Proposal”), with certain notable deviations. Additionally, the FDIC Proposal addresses the eligibility of stablecoin reserves for pass-through deposit insurance and tokenized deposits for deposit insurance.
Comments on the FDIC Proposal are due no later than June 9, 2026. In this Legal Update, we provide background on the GENIUS Act implementation and discuss some of the notable differences between the FDIC Proposal and the OCC Proposal.
Background
The GENIUS Act, signed into law on July 18, 2025, establishes a federal regulatory framework for payment stablecoins and restricts their issuance to permitted payment stablecoin issuers (“PPSIs”). The GENIUS Act creates three pathways to become a PPSI:
- A subsidiary of an insured depository institution (“IDI”) approved by its primary federal regulator
- A “Federal qualified payment stablecoin issuer” (“FQPSI”) approved by the OCC
- A “State qualified payment stablecoin issuer” (“SQPSI”) approved by a state regulator
Additionally, the GENIUS Act creates a path for payment stablecoin issuers who are not based in the United States (“FPSIs”) to continue circulating their stablecoins among US persons. Each primary federal payment stablecoin regulator must promulgate implementing regulations by July 18, 2026. The GENIUS Act takes effect on January 18, 2027, or 120 days after final implementing regulations are issued, if earlier.
In December 2025, the FDIC issued the first agency-specific implementing rulemaking, proposing an application process for subsidiaries of FDIC-supervised IDIs. As noted above, in February 2026, the OCC issued the OCC Proposal to regulate stablecoin activities by national banks, federal savings associations, federal branches, and their subsidiaries, as well as nonbank entities seeking FQPSI status, FPSIs, and certain SQPSIs who would be subject to OCC authority (“OCC PPSIs”). While the FDIC Proposal primarily addresses the stablecoin activities of subsidiaries of FDIC-supervised IDIs (“FDIC PPSIs”), it also would address deposit insurance eligibility for any stablecoin reserves held by an IDI and tokenized deposits.
FDIC Proposal vs. OCC Proposal
Please see our earlier Legal Update for a comprehensive discussion of the OCC Proposal. Below we highlight some of the key differences between the FDIC Proposal and the OCC Proposal.
| FDIC Proposal | OCC Proposal |
|---|---|
| Section 350.3(b)(8) would prohibit an FDIC PPSI from providing a customer with credit to purchase the issuer’s stablecoins. | The OCC Proposal has no similar prohibition. |
| Section 350.4(c) would permit a single PPSI to issue more than one brand of stablecoin as long as each brand has its own reserves and they are segregated from each other. | The OCC Proposal has no similar authorization and solicits comment on whether it should prohibit multi-brand issuance (Question 172). |
| Section 350.4(f) would require an FDIC PPSI to limit its reserve asset exposure to a single eligible financial institution to no more than 40% of the issuer’s reserve assets. | Section 15.11(c) would impose additional limits on reserve asset concentration, and Section 15.11(d) would require an OCC PPSI to maintain a certain portion of its reserves in the form of insured deposits with an IDI. |
| Section 350.4(j) would require an FDIC PPSI to maintain a written contingency plan of measures to be taken if it fails to satisfy the minimum reserve requirements or minimum capital requirements. | Section 15.11(g)(4) would permit the OCC to require an OCC PPSI to submit a remediation plan if it fails to satisfy the minimum reserve asset requirements, but the issuer would not need to maintain the plan prior to its noncompliance with the requirement. |
| Section 350.4(i) permits the FDIC to direct an FDIC PPSI that has failed to meet minimum reserve requirements to execute an orderly redemption of all outstanding payment stablecoins, but does not specify an automatic liquidation timeline. The FDIC solicits comment on whether to require automatic liquidation if an FDIC PPSI fails to meet its minimum reserve asset requirement (Question 56). | Section 15.11(g)(3) provides that if an OCC PPSI fails to meet minimum reserve requirements for 15 consecutive business days, it must begin liquidation and redemption without charging redemption fees. |
| Section 350.4(k) would require an FDIC PPSI to notify the FDIC if the issuer will redeem all outstanding payment stablecoins. | The OCC has no similar notice requirement. |
| Under Section 350.5(c) of the FDIC Proposal, an FDIC PPSI experiencing a “significant redemption request” must provide immediate notice to the FDIC and may request an extension beyond the standard two-business-day redemption period. The FDIC may grant or deny the extension request in its sole discretion. | Section 15.12(c)(1) provides that if redemption demands exceed 10% of outstanding issuance value in a single 24-hour period, the redemption period is automatically extended to seven calendar days by operation of the rule. An OCC PPSI may redeem sooner only with permission from the OCC. |
| Section 350.6(a)(5) would exclude transactions between an IDI and a subsidiary FDIC PPSI from the restrictions on affiliate transactions. | Section 15.13(a)(6) of the OCC Proposal has no similar carveout for transactions between a PPSI and an affiliated IDI. |
| Section 350.9(c) provides that an FDIC PPSI failing to meet capital or backstop requirements at quarter-end must comply with FDIC directives to address the matter, but does not mandate suspension of issuance, redemption of outstanding stablecoins, or liquidation of reserves within a specified period. The FDIC solicits comment on whether to require automatic liquidation at the end of two consecutive quarters of failing to meet these requirements (Question 54). | Under Section 15.41(c) of the OCC Proposal, if an OCC PPSI fails to meet minimum capital or backstop requirements at the end of a quarter, it generally is prohibited from issuing any new payment stablecoins. If it fails to meet those requirements at the end of two consecutive quarters, it must begin liquidation of reserve assets and redemption of outstanding stablecoins, may not charge redemption fees, and may not issue new stablecoins going forward. |
| The FDIC Proposal does not include a statement regarding permissible activities under other applicable law that is similar to that in the OCC Proposal. | Section 15.10(b) would expressly state that the activities limitations of the GENIUS Act do not prevent a depository institution, national bank, or trust company from engaging in activities that are permissible under other applicable state or federal law. |
| The FDIC Proposal does not include a restriction on withdrawal of excess reserves that is similar to the OCC’s. | Section 15.11(a)(3) would permit an OCC PPSI to withdraw surplus reserve assets in excess of outstanding issuance value once per month following the publication of the reserves composition report. |
| The FDIC Proposal has no similar requirement. | Section 15.13(a)(5) would require an OCC PPSI to maintain systems and controls to ensure that earnings are sufficient to support operations and satisfy capital requirements. |
| The FDIC Proposal has no similar requirement. | Section 15.13(a)(8) would require an OCC PPSI to maintain systems and controls to manage concentration risk (beyond compliance with reserve asset diversification and concentration requirements). |
| The FDIC Proposal has no similar requirement. | Section 15.13(b)(4) would require an OCC PPSI to maintain safeguards to protect and appropriately dispose of nonpublic personal information of customers. |
| The FDIC Proposal does not contain a notice requirement that is similar to the OCC’s, but does request comment on whether it should impose one (Question 95). | Section 15.14(m) would establish a prior notice requirement for a person seeking to acquire control of an OCC PPSI. |
| Section 350.9(b)(2) would impose requirements on an FDIC PPSI that are similar to those in the OCC Proposal, but the FDIC would not require that demand deposits at an IDI be fully covered by deposit insurance. | Section 15.41(b)(2) would require an OCC PPSI to maintain an operational backstop of assets consisting of cash, money standing at a Federal Reserve Bank, fully insured demand deposits at an IDI, or short-term Treasuries. |
Pass-through Deposit Insurance
A PPSI must maintain identifiable, eligible reserves backing outstanding payment stablecoins on at least a one-to-one basis. Eligible reserves include funds held as demand deposits (or other deposits that may be withdrawn upon request at any time) or insured shares at an IDI (including any foreign branches or agents, including correspondent banks, of an IDI).
The FDIC generally insures deposits at an IDI up to a maximum of $250,000 per depositor for each account ownership category for which the depositor has accounts at the IDI. However, if (i) an agent deposits funds at an IDI in its own name but acting on behalf of a principal and (ii) the deposit account records of the IDI recognize the existence of the agent-principal relationship, then the principal’s deposits will be insured to the same extent as if they had been deposited by the principal in the principal’s own name. This concept is known as “pass-through” deposit insurance because it permits the deposit insurance coverage limits to pass through the agent and be applied at the level of the principal.
The GENIUS Act provides that payment stablecoins may not be subject to FDIC deposit insurance. However, the GENIUS Act is silent on whether reserves deposited by a PPSI with an IDI in a deposit account may qualify for pass-through deposit insurance (i.e., treating the PPSI as the agent of the stablecoin holder).
The FDIC Proposal states that the prohibition against direct deposit insurance of payment stablecoins seems to be inconsistent with providing deposit insurance to payment stablecoin holders on a pass-through basis. Therefore, the FDIC Proposal would amend the deposit insurance coverage rules to clarify that deposits held as reserves for a payment stablecoin are not insured to payment stablecoin holders on a pass-through basis. Instead, such deposits would be treated as deposits of the PPSI. This would mean that the deposits would be insured up to $250,000 with respect to the PPSI, instead of being insured up to $250,000 with respect to each of the stablecoin holders.
FDIC Proposal and Tokenized Deposits
The FDIC Proposal also addresses the treatment of tokenized deposits under the Federal Deposit Insurance Act (“FDI Act”), which the GENIUS Act expressly excludes from the definition of “payment stablecoin.”
The FDIC Proposal would amend the deposit insurance rules to clarify that the availability of deposit insurance does not depend on the technology or recordkeeping used to record a bank’s deposit liabilities. Under this approach, an IDI’s tokenization of its deposit liabilities would not alter the legal status of those liabilities as “deposits” under the FDI Act, and depositors using tokenized deposits would be entitled to the same deposit insurance coverage as depositors using traditional forms of deposits.
