The Federal Reserve has unveiled one of the first major steps toward implementing the GENIUS Act, less than a month after Kevin Warsh took over as Fed chair. On June 18, the Fed and four othe
The Federal Reserve has unveiled one of the first major steps toward implementing the GENIUS Act, less than a month after Kevin Warsh took over as Fed chair.
On June 18, the Fed and four other U.S. financial regulators proposed new customer identification requirements for certain payment stablecoin issuers, bringing them closer to the compliance standards already applied to banks and credit unions.
The proposal marks the Fed's first formal rulemaking tied to the GENIUS Act, the landmark stablecoin law signed by President Donald Trump in July 2025.
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Under the proposal, certain payment stablecoin issuers would be required to maintain customer identification programs similar to those used by banks and credit unions.
The proposal applies only to stablecoin issuers that are authorized under the GENIUS Act's regulatory framework, including certain bank subsidiaries, federally approved nonbank issuers, and qualified state-regulated firms. It doesn't apply to every stablecoin issuer.
The rule was issued jointly by the Fed, the Financial Crimes Enforcement Network, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the National Credit Union Administration.
Regulators will accept public comments for 60 days after the proposal is published in the Federal Register.
According to the agencies, the requirements are designed to strengthen anti-money laundering (AML) safeguards, improve customer verification procedures, and help combat illicit finance involving payment stablecoins.
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The proposal quickly drew attention across the crypto industry and policy observers.
Custodia Bank CEO Caitlin Long noted that "the Fed joined this one" and described it as "the Fed's first GENIUS rulemaking."
She also highlighted that Warsh abstained from the vote and that Fed Governor Michael Barr issued a separate statement.
Long later said, "Warsh's abstention from this vote is unusual & he gave no explanation."
The move comes during Warsh's first month as Fed chair and follows his broader review of the Fed operations during the June 16-17 FOMC meeting.
Fed Governor Michael Barr said he supports the proposal but remains concerned that the GENIUS Act framework may not fully address illicit finance risks in secondary-market stablecoin transactions.
"I remain concerned, however, that the GENIUS Act regulatory framework does not do enough so far to address the risks of illicit finance conducted through secondary market transactions in payment stablecoins," Barr said.
He added that he would review feedback on whether parts of the customer identification framework should be extended to secondary-market activity and assess whether additional safeguards may be needed.
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