FDIC proposes AML, sanctions rule for U.S. stablecoin issuers

The Federal Deposit Insurance Corporation proposed a rule on Friday that would require U.S.-based stablecoin issuers to establish anti-money laundering and countering the financing of terrorism (AML/CFT) programs, enforce U.S. economic sanctions and collect and report sender and receiver identification for stablecoin transfers under the GENIUS Act. The agency opened a 60-day public comment period before moving to formal rulemaking.

The proposal incorporates reporting and sanctions provisions used by the Financial Crimes Enforcement Network and the Office of Foreign Assets Control, and is aimed at issuers subject to U.S. supervision. The FDIC described the framework as aligning stablecoin reporting and sanctions tools with existing federal requirements.

The rule follows two earlier FDIC actions implementing the GENIUS Act: licensing criteria published in December and a prudential framework released in April. Other federal agencies are issuing related guidance required by the GENIUS Act, including the Treasury Department, OFAC, the Office of the Comptroller of the Currency and the National Credit Union Administration. Seven proposed rules across agencies have been released so far; three have closed public comment windows and none have been finalized. Agencies are aiming to meet a July 18 implementation deadline.

The FDIC cited recent law enforcement use of freezing capabilities when explaining the proposal. Private firms have assisted the U.S. Treasury in freezing roughly $344 million in crypto assets alleged to be linked to Iran’s government. Popular stablecoins such as USDT and USDC include technical features that can be used to freeze funds; the proposal would set standard conditions under which regulated issuers may use those capabilities.

Banks and industry groups have raised concerns about the pace and scope of the GENIUS Act rulemaking. The banking lobby has urged regulators to slow the process and questioned whether granting national trust-charter licenses to crypto firms and extending access to Federal Reserve payment systems is appropriate.

At the same time, several large financial institutions are developing tokenized money products that could work with regulated stablecoins. Fidelity, JPMorgan and U.S. Bancorp have announced or are developing tokenized money funds intended to hold reserves available for instant redemption and to generate yield on balance-sheet cash.

The FDIC’s 60-day comment window will allow banks, industry stakeholders, consumer groups and others to submit feedback before the agency proceeds to formal rulemaking. The final rule will determine how regulated U.S. stablecoin issuers handle transaction monitoring, sanctions blocking and identity reporting once the GENIUS Act requirements take effect.