A proposed rule to sets standards for credit unions approved to act as permitted payment stablecoin issuers (PPSIs) under the GENIUS Act was issued Friday by the National Credit Union Administration (NCUA).
The proposal supplements the agency’s January proposal dealing with the licensing of credit unions approved to be stablecoin issuers. The GENIUS Act – or the Guiding and Establishing National Innovation for U.S. Stablecoins Act – permits financial institutions to issue payment stablecoins through a subsidiary and to engage in “certain related activities.”
The comment deadline on the NCUA’s January proposal closed April 13; the deadline for comments on Friday’s proposal is July 17.
NCUA appears to be working under a deadline of July 18 to adopt final rules, as the act’s effective date is the earlier of 18 months after its enactment (July 18, 2025) or 120 days after the primary federal payment stablecoin regulators (NCUA, for example) issue final implementing rules.
A Federal Register notice slated for publication Monday shows the proposed rule would make amendments to address share insurance coverage, tokenized shares, and other conforming and clarifying amendments, the notice says.
For example, the rule would provide that an NCUA-Licensed PPSI “may not directly or through implication represent that Payment Stablecoins are backed by the full faith and credit of the United States, guaranteed by the United States Government, or subject to Federal deposit insurance or Federal share insurance.”
Other provisions, the notice says, an NCUA-Licensed PPSI” must not pay the holder of any Payment Stablecoin any any form of interest or yield (whether in cash, tokens, or other consideration) solely in connection with the holding, use, or retention of such Payment Stablecoin.”
In a release Friday, agency Chairman Kyle Hauptman said the agency “worked diligently to align the standards for NCUA-licensed PPSIs with the standards that are proposed for bank subsidiaries.”
NCUA Announces Proposed Rule for Permitted Payment Stablecoin Issuer Standards
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