U.S. Treasury Opens New GENIUS Act Rulemaking on Stablecoin Issuance

The U.S. Department of the Treasury on 17 August 2026 opened a new notice of proposed rulemaking under the Guiding and Establishing National Innovation for U.S. Stablecoins Act, seeking public comment on implementation of Section 3 of the GENIUS Act.

Treasury’s own press-release index confirms the new rulemaking was issued on 17 August. The proposal is separate from the April rulemaking that addressed anti-money laundering, sanctions compliance and other illicit-finance obligations for permitted payment stablecoin issuers.

Section 3 defines who may issue payment stablecoins

Section 3 of the enacted GENIUS Act establishes the basic legal perimeter for payment stablecoin issuance in the United States. It provides that only a permitted payment stablecoin issuer may issue a payment stablecoin in the United States, subject to limited statutory exceptions and any safe harbours Treasury may establish by regulation.

The law also extends beyond direct issuance. Beginning three years after enactment, digital asset service providers generally may not offer or sell a payment stablecoin to a person in the United States unless the token was issued by a permitted payment stablecoin issuer, subject to the Act’s exceptions.

Foreign payment stablecoin issuers face an additional condition: a stablecoin may not be made available in the United States unless the foreign issuer has the technological capability to comply, and will comply, with lawful U.S. orders and applicable reciprocal arrangements.

Treasury has authority to define implementation details

Section 3 expressly directs Treasury to issue implementing regulations, including rules defining relevant terms. It also allows Treasury to create limited safe harbours that are consistent with the Act, narrow in scope and confined to a de minimis volume of transactions. The statute separately allows limited safe harbours in unusual and exigent circumstances, subject to congressional notification requirements.

Knowingly participating in prohibited issuance can carry a penalty of up to US$1 million for each violation, imprisonment of up to five years, or both. The Act also states that non-compliant payment stablecoins cannot receive certain forms of treatment as cash or cash equivalents and cannot be used as settlement assets in specified wholesale banking contexts.

Part of a broader stablecoin regulatory build-out

The 17 August consultation is one component of a broader sequence of GENIUS Act implementation work. Treasury previously issued an advance notice of proposed rulemaking in September 2025, a state-regulatory-regime proposal in April 2026, and a separate April proposal from FinCEN and OFAC covering AML/CFT and sanctions obligations for permitted payment stablecoin issuers.

Those earlier proposals addressed issues such as Bank Secrecy Act treatment, customer due diligence, suspicious activity reporting, sanctions controls and the technical ability of issuers to comply with lawful blocking or freezing orders. The new Section 3 rulemaking instead concerns the statutory boundary around who may issue or make payment stablecoins available in the United States.

The proposal remains at the notice-and-comment stage. It should not be treated as a final rule or as a change that is already fully effective.