The US Department of the Treasury has issued a Notice of Proposed Rulemaking (NPRM) seeking public comment on its implementation of Section 3 of the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act.
The GENIUS Act is scheduled to take effect on 18 January 2027. Under the law, payment stablecoin issuers generally must obtain an appropriate federal or state license to operate in the US.
The proposed rules also establish requirements for foreign-issued payment stablecoins, including restrictions on US digital asset service providers offering or selling such stablecoins unless specified legal and regulatory conditions are met. Treasury will review public comments before finalizing the rules.
The GENIUS Act represents a change from a regulatory framework based on a range of federal and state regulations that stablecoin companies had to comply with to a unique federal framework dedicated to payment stablecoins. Congress established this framework through Public Law 119-27 on 18 July 2025. According to the Act, a payment stablecoin is defined by its function as a mode of payment or settlement as well as by the issuer’s commitments or promises about redemption and stable value.
Businesses are expected to operate under licensing and supervisory requirements rather than relying solely on the view that a token is a technology product. The law also establishes reserve requirements, redemption standards, reporting obligations, risk management requirements and rules for foreign issuers.
US President Donald Trump signed the GENIUS Act into law on 18 July 2025, making it the first US federal law focused on establishing a regulatory framework for payment stablecoins.
The legislation addresses two policy goals. One is to reduce regulatory uncertainty for companies building payment and financial products around stablecoins. The other is to ensure those products operate within a framework that addresses financial stability, illicit finance, sanctions compliance and consumer protection.
Treasury Secretary Scott Bessent has described the implementation effort as part of efforts to strengthen US leadership in payment stablecoins and support the dollar’s role in global finance.
The GENIUS Act will officially take effect on 18 January 2027, or 120 days after primary federal payment stablecoin regulators issue final implementing regulations, whichever comes first. Because federal agencies missed their initial July 2026 rule-finalisation targets, 18 January 2027, remains the primary hard stop date for compliance preparations across the industry.
Another important date is 18 July 2028. After that date, providers of digital assets may generally not offer or sell payment stablecoins to customers located in the US unless those payment stablecoins have been issued by a payment stablecoin issuer that is authorised in accordance with the legislation.
Treasury’s proposed rules seek to clarify when a stablecoin is considered “issued” in the US and when an issuer or service provider offers or sells a payment stablecoin to a US person. The proposal follows an advance notice of proposed rulemaking issued by Treasury last September and is now open for public comment. Treasury said it is seeking feedback from industry participants and other stakeholders as it develops the regulatory framework. The public will have 60 days from the proposal’s publication in the Federal Register to submit comments.
.@POTUS and Congress delivered the GENIUS Act, establishing a landmark framework and clear rules of the road for payment stablecoins, and Treasury is moving quickly to implement that framework. @USTreasury welcomes input from stakeholders as we work to provide the regulatory…
— Treasury Secretary Scott Bessent (@SecScottBessent) August 17, 2026
With the implementation of the GENIUS Act, US regulation of stablecoins has reached an important milestone. The deadline of January 2027 for effective provisions and the restrictions on the offer and sale of payment stablecoins as of July 2028 has created a timeline for the operations of various business entities.
It means that issuers will have to take into account the licensing process applicable to them, exchanges will check the current listings of products they offer, and foreign firms will analyse whether their compliance requirements fit the regulations imposed by the US. At the same time, the developments in this area will hugely rely upon the specific nature of the US Department of Treasury’s final regulations and those provided by other federal regulators of payment stablecoin.
