Treasury filed its first proposed rule under the GENIUS Act, 12 C.F.R. Parts 1520–1521, setting the standard that determines whether a stablecoin issuer answers to its state regulator or the OCC.
The Notice of Proposed Rulemaking establishes a “substantially similar” test: issuers with up to $10 billion in outstanding stablecoin issuance can elect state supervision, but only if their state’s framework meets or exceeds the federal baseline. Cross $10 billion, and OCC oversight kicks in automatically.
The proposed rule creates two tiers. Uniform requirements (reserve assets, AML/BSA/sanctions programs, disclosure restrictions) can’t be tailored by states. State-calibrated requirements (capital requirements, certain governance rules, some risk management practices) allow states to experiment, as long as outcomes are at least as strong as the federal model. The new framework would live in Subchapter C of Title 12 of the C.F.R., with Part 1521 doing the analytical work.
The NPRM doesn’t answer two questions that matter most. First: how will Treasury actually enforce the “meet or exceed” standard over time? The proposal is light on how certifications get revisited or withdrawn. Second: what happens when issuers structure operations to stay under the $10 billion threshold? Both gaps are open for comment.
OCC is the primary baseline for comparison because most state-qualified issuers are nonbanks that would land under OCC supervision if they grew past the threshold.
Comments are due June 2, 2026.
James Okafor