The GENIUS Act became law on July 18, 2025, but ten months later, OCC, FDIC and FinCEN are still writing the operational rules that will make the legislation concrete for anyone who issues, holds or manages stablecoins in the US market. Tether still doesn't know with certainty whether it can legally operate in the United States from 2027 without a structural overhaul of its reserve model.
According to CoinGecko data from May 2026, the stablecoin market now exceeds $240 billion in global market cap, with Tether's USDT holding over 67% of the share and Circle's USDC around 27%. The remainder is split between PayPal USD, DAI and a range of smaller issuers. The question the industry is asking right now isn't whether the GENIUS Act changes things. It's when, and for whom.
What the GENIUS Act Requires for Stablecoins
Functionally, the law, signed on July 18, 2025 with 308 votes in the House and 68 in the Senate, establishes for the first time in the US who can issue a “payment stablecoin” and under what rules. The short answer: only entities that obtain permitted payment stablecoin issuer status from a qualified federal or state regulator.
Reserves must consist exclusively of cash, insured bank deposits and short-term US government securities. No Bitcoin as a reserve asset, though risk assets are excluded entirely. The redemption system must function at all times, with precise disclosure obligations and regular audits. Stablecoins that meet these criteria aren't classified as securities or commodities. Instead enter a third, standalone regulatory framework. For the industry, that's a structural win.
The critical threshold is $10 billion in market cap: anyone exceeding it must mandatorily transition to the federal OCC regime within 360 days, or request an exemption. For Tether and Circle, both already well above that threshold, this isn't a future problem. It's the present.
How It Works in Practice: Issuers, Reserves and Oversight
OCC, FDIC and FinCEN published their proposed rules in sequence between February and April 2026. Three separate agencies, three sets of rules to coordinate. The OCC Bulletin 2026-3, dated February 25, 2026, is the most relevant document for national banks and non-bank entities seeking to become Federal Qualified Payment Stablecoin Issuers. The comment deadline was May 1, 2026, and those who participated in the consultation are already shaping the final rule.
Circle moved first. Its CPN Managed Payments product, launched on April 8, 2026, brings USDC into banks and fintechs without those institutions directly managing digital assets. It's a product designed precisely for the post-GENIUS Act world. Tether, operating primarily offshore in the British Virgin Islands, is in a more delicate position: the law allows foreign issuers to operate in the US only if the Treasury Department certifies that their jurisdiction has “comparable” standards. That certification isn't automatic. It won't happen overnight.
On the anti-money laundering front, FinCEN and OFAC published a joint rule on April 9 treating stablecoin issuers as financial institutions for AML purposes. Every transaction above certain thresholds requires customer identification, suspicious activity reports and a structured compliance program.
Stablecoin transaction volumes already surpass Visa globally. The GENIUS Act hasn't slowed this growth. If anything, it's accelerated it, because institutions that were waiting for regulatory certainty now have it, at least on paper.
FinCEN detailed the joint rule via a post on its official X account, @FinCEN_News, on April 9, 2026.
What Changes for European Operators
Stablecoin market composition by market cap, % share, May 2026
Source: CoinGecko, May 2026
For operators based in the EU, the question isn't whether the GENIUS Act affects them directly. It's whether it changes the playing field indirectly. It does, on three specific points.
First: businesses using stablecoins for cross-border payments toward US clients may be required to operate only with GENIUS Act-certified issuers. Non-certified options will lose institutional ground. Second: European banks that have been increasing crypto exposure in 2026 must verify whether the stablecoin products they use conform to the new US taxonomy, because dual compliance with both MiCA and the GENIUS Act is becoming the de facto requirement for operating in both economic zones. Third: the GENIUS Act is becoming a global benchmark in its own right, not something separate from MiCA but a second reference layer that operators must satisfy in parallel.
A practical note for British and broader European readers: the FCA's stablecoin regime, finalized in 2025, shares several features with the GENIUS Act framework around reserve quality and redemption obligations. Firms already compliant with FCA stablecoin rules are better positioned for GENIUS Act alignment than those operating under lighter-touch regimes.
What to Do Now If You're in the Sector
The date to mark is January 18, 2027. By that deadline, most final rules will be operative. But intermediate deadlines already matter: anyone running an exchange or platform that integrates stablecoins needs to evaluate which issuers will be compliant and which risk losing access to the US market.
The CLARITY Act, which treats Bitcoin as a CFTC commodity and redefines jurisdiction over a large portion of altcoins, is moving in parallel with the GENIUS Act. Two separate laws, but together they're building the US regulatory framework for 2026-2027. Watching only one of them means seeing half the picture.
Centralized exchanges accepting stablecoin deposits must monitor the US Treasury's certification list. If Tether doesn't clear the review, USDT could lose ground to USDC for institutional cross-border flows. That outcome isn't certain, but it needs to be in any serious risk calculation.
47 organizations submitted formal comments to the OCC rule by May 1, 2026, including Visa, JPMorgan, Coinbase and three European central banks as informal observers, according to the OCC's public comment record. The comment window is now closed. The final rule is being written. Operators who weren't tracking this process now have until January 2027 to get compliant, and that window is narrowing faster than it looks.
