U.S. Regulators Propose Bank-Style Customer ID Rules for Stablecoin Issuers Under GENIUS Act

TLDR

• The Fed, Treasury, OCC, FDIC and other agencies proposed a rule requiring stablecoin issuers to verify customer identities like banks do
• The rule stems from the GENIUS Act, signed into law in July 2025
• Issuers must check names, addresses, and terrorist watch lists under Bank Secrecy Act standards
• A 60-day public comment period is now open after the rule is filed in the Federal Register
• Fed Governor Michael Barr raised concerns the rules don’t go far enough on secondary market transactions

U.S. financial regulators have proposed new rules that would require stablecoin issuers to follow the same customer identification standards as banks.

The proposal was released Thursday by a group of agencies including the Federal Reserve, Treasury Department, FDIC, OCC, and the National Credit Union Administration.

The rule is part of the rollout of the Guiding and Establishing National Innovation for U.S. Stablecoins Act, known as the GENIUS Act, which was signed into law in July 2025.

What the Rules Would Require

Under the proposal, stablecoin issuers would be treated as regulated financial institutions under the Bank Secrecy Act.

That means they would need to verify the identity of anyone opening an account, keep records of that information, and check users against government terrorist watch lists.

These are the same requirements banks and brokerages already follow to fight money laundering and terrorism financing.

The proposed rule will be open for public comment for 60 days after it is officially filed in the Federal Register on Monday.

This is the second round of public input. The Treasury received 450 comments during an earlier, more preliminary stage last September.

Industry Context

Stablecoin issuers currently operating in the U.S. include Tether, which issues the token USDT, and Circle, which issues USDC.

A number of traditional financial firms have also entered the stablecoin market in recent months.

The GENIUS Act is expected to take full effect 18 months after it was signed, or 120 days after regulators finalize their rules.

The Treasury’s financial crimes unit, FinCEN, has separately proposed its own rules targeting illicit finance under the same law.

In April, the FDIC also proposed that deposit insurance for stablecoin issuers would not extend to token holders.

A Dissenting Voice

Not everyone on the board is fully satisfied with the proposal’s current scope.

Fed Governor Michael Barr said he remains concerned the GENIUS Act framework does not do enough to address illicit finance in secondary market transactions.

Barr said it is “far too easy for bad actors to evade these restrictions” when trading digital assets.

The 130-page proposal directly asks whether the identification requirements should be extended to cover secondary market activity, and invites public comment on that question.

Meanwhile, Congress has not set a timeline for the Digital Asset Market Clarity Act, a separate bill that would redefine how agencies regulate crypto more broadly.

Some in Washington expect that bill to pass before the August recess, but Democratic concerns over conflicts of interest could slow its progress.

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