After being passed last July, the US stablecoin framework, the GENIUS Act, is now preparing for the final phase of implementation.
The U.S. National Credit Union Administration (NCUA), one of four federal regulators overseeing the industry, has unveiled proposed rules for credit unions seeking to issue payments stablecoins.
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Other regulators charged by the GENIUS Act with formulating laws to operationalize the payment stablecoin framework include the FDIC, OCC, and Federal Reserve. So far, the NCUA’s latest initiative makes it the first to promote implementation.
Reacting to the same, NCUA President Kyle Hauptman said,
“We are on track to meet the July 18 congressional deadline. Credit unions should be aware that they will not be at a disadvantage compared to other entities, either in terms of timeline or standards.”
What’s next after the NCUA’s draft proposals?
Under the direction of the NCUA propose rules, federally insured credit unions (FICUs) cannot directly issue stablecoins; they can only do this through a subsidiary.
Furthermore, the FICU must hold more than 10% of the subsidiary. NCUA licenses will therefore be issued to the FICU subsidiary.
Regarding the application requirements, there will be a 120-day delay for the NCUA’s decision after a potential issuer finalizes the filing. And applicants will have the right to reapply even after being refused. Other requirements, such as reserve support, will be issued later.
Stakeholders (credit unions, industry groups, fintechs, etc.) are expected to provide feedback on these proposed rules by April 13, 2026.
After considering these comments, the NCUA will revise and clarify the provisions. The process addresses concerns and refines the framework. After revisions, the NCUA issues updated rules as legally enforceable regulations. This action marks the final step in the implementation of the GENIUS Act.
That said, other major stablecoin players, such as Tether, Circleand Ripple, will be regulated by the Office of the Comptroller of the Currency (OCC). To be eligible, these actors requested a trusted national bank license.
But the OCC has yet to release proposed rules on them, about five months before Congress’s implementation deadline.
Impact on stablecoins
Since the GENIUS Act came into effect, the stablecoin market has jumped from $250 billion to almost $320 billion. However, the market has stagnated at around $308 billion amid a broader crypto market slowdown.
This highlighted that crypto trading remains a major driver of stablecoin market growth despite growing interest in the payments segment.
Source: DeFiLlama
Final Thoughts
- The NCUA proposed that credit unions seeking to become stablecoin issuers would do so through the subsidiaries they control.
- The credit union watchdog has sought feedback from stakeholders by April to help meet the July 2026 implementation deadline.
