US Treasury Establishes Stablecoin Licensing Framework Under GENIUS Act, Enforcement Begins 2027
The Treasury Department has unveiled a regulatory pathway for stablecoins in the United States, requiring issuers to obtain federal or state licensing beginning next year and restricting platform sales of unapproved coins by mid-2028.
New Licensing Requirements Take Effect in 2027
The U.S. Department of the Treasury unveiled proposed regulations Monday that establish which stablecoins can be issued and distributed within American borders. The rules, developed under the GENIUS Act’s Section 3, introduce a licensing requirement for those seeking to issue payment stablecoins domestically. According to the proposal, stablecoin issuers must obtain either federal or state authorization effective January 18, 2027.
The framework also permits platforms to distribute stablecoins created outside the US, provided the foreign issuer adheres to applicable American legal requirements and maintains regulatory agreements with the issuer’s home jurisdiction.
Platform Restrictions Tighten in 2028
Further restrictions escalate eighteen months later. Beginning July 18, 2028, cryptocurrency exchanges and digital asset platforms will face broad prohibitions against selling stablecoins to American customers unless those stablecoins originate from a Treasury-approved issuer. The regulation defines violations broadly, capturing direct solicitation of US buyers, marketing stablecoins as available to American users, accepting sales following unsolicited customer requests, and enabling workarounds such as circumventing geographic blocks through IP masking.
Regulatory Rollout and Public Input
Treasury Secretary Scott Bessent described the proposed rules as delivering on commitments to provide businesses with regulatory clarity and safeguard the dollar’s standing. According to the Treasury Department, these standards aim to “cement the role of the U.S. dollar as the world’s reserve currency” while positioning America competitively in digital asset innovation.
The Treasury is accepting public comment on the proposal through October 19, 2026—sixty days from its Federal Register publication. The regulatory development represents the latest phase in implementing the GENIUS Act, which President Trump signed into law in July 2025. The Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation have already proposed complementary rules governing stablecoin issuance, reserves, capital requirements, and risk oversight. In April, the Treasury also introduced anti-money laundering and sanctions requirements mandating that issuers report suspicious transactions and maintain freeze capabilities.
Source: U.S. Department of the Treasury, via Decrypt. Not financial advice.
Why it matters: This regulatory clarity could reshape stablecoin competition in the US market, potentially favoring established issuers while creating barriers for emerging alternatives—dynamics that may reinforce institutional player dominance across the broader crypto landscape including asset tokens like XRP.