- FDIC proposal targets bank-linked payment stablecoin issuers under BSA rules.
- The rule adds AML, sanctions, reporting, and enforcement standards for supervised issuers.
- FDIC says up to 30 supervised institutions may apply to issue payment stablecoins.
The Federal Deposit Insurance Corporation moved payment stablecoins deeper into the banking compliance arena on May 22, approving a proposed rule tied to Bank Secrecy Act oversight. The proposal targets permitted payment stablecoin issuers, known as PPSIs, that operate as subsidiaries of insured state nonmember banks and state savings associations.
Bank-Linked Stablecoin Issuers Face Clearer Controls
The rulemaking forms part of the FDIC’s implementation of the GENIUS Act, which established a federal framework for regulated payment stablecoins. Under the plan, supervised PPSIs would need to follow anti-money laundering, counter-terrorist financing, sanctions, and reporting standards set by federal agencies.
That places bank-linked stablecoin issuers under clearer expectations for transaction monitoring, suspicious activity reporting, sanctions screening, and compliance governance. The FDIC proposal would amend part 350 of its rules to add BSA and sanctions compliance standards for supervised PPSIs.
It would also create a new subpart covering supervision and enforcement of AML/CFT programs at those stablecoin subsidiaries.
Compliance Layer Follows Prudential Proposal
The May 22 measure follows an earlier FDIC proposal in April focused on broader prudential requirements for supervised stablecoin issuers. That earlier proposal dealt with reserve assets, redemption practices, capital, liquidity, and risk management standards.
Together, the two proposals show a two-track approach, covering both financial strength and illicit-finance controls for future issuers. The latest proposal also places Treasury-linked rules at the center of the compliance process.
FinCEN would remain central to AML/CFT requirements, while OFAC sanctions programs would shape screening and enforcement expectations.
FDIC Sees Early Stablecoin Market as Rules Take Shape
The FDIC said it currently supervises zero permitted payment stablecoin issuers, showing the market remains at an early stage. Still, the agency estimated that five to 30 supervised institutions could apply through subsidiaries in the first few years after the rules take effect.
For banks and fintech partners, the proposal signals that payment stablecoin issuance inside insured banking channels will carry familiar compliance duties. The rule also shows how federal agencies are preparing oversight before bank-linked issuance becomes widespread.
Notably, the FDIC said public comments will remain open for 60 days after Federal Register publication, giving the industry a final window to respond before the framework advances.
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