How the GENIUS Act splits stablecoin supervision between Washington and the states — and the certification machine that keeps the federal keys.
Eleven months after enactment, the rulebook has largely arrived — from the OCC, FDIC, NCUA, Treasury, and jointly from FinCEN and OFAC. The decisive question is no longer whether stablecoins are regulated but who regulates them, and whether a state charter can carry an issuer across all fifty.
The Act answers with two tracks over one prudential floor, divided at $10 billion. The state track only opens once a state certifies its regime “substantially similar” and a three-member federal committee unanimously agrees — a gate Treasury only began to operationalize on April 3. One conspicuous gap remains: the Federal Reserve has issued no proposal, the single largest hole in the implementation picture and a live risk to the effective date.
Only a “permitted payment stablecoin issuer” (PPSI) may issue a payment stablecoin in the United States. The Act builds two routes to that status — and draws the dividing line at ten billion dollars of outstanding issuance.
Answer two or three questions to see the pathway the statute assigns, the supervisor it lands with, and the strings attached. The logic tracks the entity definitions in Sections 2–4 and the agency proposals issued this spring.
The tracks diverge on eligibility, supervisor, and gateway — but converge on the prudential floor. The dark band is the part of the Act that binds everyone, whichever door they enter.
| Dimension | Federal track | State track |
|---|---|---|
| Eligible issuers | IDI subsidiaries (any size), OCC-licensed nonbanks, uninsured national banks, federal branches, registered foreign issuers | Nonbank issuers organized under state law — only up to $10B consolidated outstanding |
| Primary supervisor | OCC, FDIC, Fed, or NCUA — by charter type | State payment stablecoin regulator (e.g., a state banking department) |
| Size ceiling | None | $10B — then 360-day transition to federal, a waiver, or cease net new issuance |
| The gateway | Agency licensing & approval (default-approval clocks — FDIC 120 days) | State law + the state’s own certification, ratified by a unanimous federal committee |
| Prudential reference | OCC / FDIC / NCUA implementing rules atop the statute | A regime “substantially similar” to the whole framework; the OCC NPRM is Treasury’s benchmark |
| The § 4 floor | Identical for both. 1:1 high-quality reserves · 93-day Treasury cap · no rehypothecation · no interest or yield to holders · monthly public reserve disclosure, CEO/CFO certified · timely redemption at par | |
| Staying in | Continuous federal supervision | Annual re-certification. If a state’s certification lapses, its issuers default to federal — regardless of size |
| Examination | Federal banking agency | State regulator (Treasury expects exam authority), under federal committee oversight |
| State MTL preemption | Yes — operate across 50 states without money-transmitter licenses | No — SQPSIs remain subject to MTL regimes outside their home state |
This is the engine room of the state track — and the part Treasury only began to operationalize on April 3. A state cannot declare itself open. It must certify its regime, and a three-member federal committee must unanimously agree before a single state-licensed issuer can rely on it.
A subtlety with real teeth: the state and the committee are measured against different slices of the Act.
When a state attests, it measures its law against the whole framework — and Treasury’s April proposal sweeps in the OCC’s implementing rules and interpretations as the prudential reference point, not just the statute. A wider, and moving, target.
The committee’s formal veto is anchored to the narrower § 4(a) standards. The gap between the two yardsticks is precisely where contested certifications will be litigated.
Treasury says it is not federalizing state chartering — states may design their own licensing so long as it is “fair, transparent, and viable.” But by fixing the OCC’s February NPRM as the prudential reference point and allowing states to be stricter but not looser, the proposal hands the OCC a de facto standard-setting role even over state-supervised issuers.
A state charter is no longer a local instrument. Certified, it becomes a nationwide passport — revocable every twelve months.
Two states have already moved. Georgia’s General Assembly passed the Georgia Payment Stablecoin Act on April 2, putting issuer licensing under the Department of Banking and Finance; Florida has enacted its own framework. Both are wagers that an early, clean certification will pull issuers into their charters — the dual-banking competitive dynamic, ported to digital money. As of late May, the committee has certified no state regime, because the standard it would apply is not yet final.
Whichever door an issuer walks through, these are the prudential terms it lives by — the non-negotiable core the state track must mirror and the agencies are now fleshing out. Tap any row to expand.
The permissible-asset list is narrow by design — in effect a Treasury-and-cash mandate, part of why the Act reads as a structural buyer of short-dated government debt.
From a one-page statute to a stack of proposals in under a year. The gold nodes are live right now — comment windows still open before they close in June. The oxblood node is the hole: the Fed has filed nothing.
The statute is settled; the architecture is not. These are the seams where the federal–state bargain will be tested over the next eighteen months.
The largest near-term structural risk. No NPRM, no announced proposal, and no public explanation — while the effective-date clock cannot start until every primary regulator finalizes. Watch whether a Fed proposal lands before July 18, or the backstop controls.
By folding OCC rules and interpretations into the federal benchmark, Treasury sets a target that moves every time the OCC updates a rule. States may find themselves perpetually chasing certification — the central comment-letter fight before June 2.
States certify against the whole framework; the committee vetoes only against § 4(a). What happens to a regime that satisfies § 4(a) but diverges from an OCC rule? The Act doesn’t say clearly — and that ambiguity is where the first disputes land.
Unanimity means Treasury, the Fed, or the FDIC can each block a state alone. That concentrates real leverage over the dual-banking balance in three appointees — and raises the odds certification becomes politically contested.
The OCC conditionally approved national trust-bank charters for Circle, Ripple, Paxos, BitGo, and Fidelity Digital Assets (Dec 2025) and Crypto.com (Feb 2026); a World Liberty Financial application is under review. Whether the NBA reaches non-fiduciary “trust” banks built to issue stablecoins is a live, novel question.
Federal-pathway issuers shed state money-transmitter licensing; state-qualified issuers do not. As an SQPSI scales, that disadvantage — plus the $10B ceiling — pushes it toward the OCC, quietly thinning the state track over time.