The U.S. Treasury is moving the GENIUS Act from legislation toward a working regulatory framework for the U.S. stablecoin market. The latest proposal addresses one of the most significant issues for crypto businesses: when stablecoin activity falls under U.S. licensing and distribution rules.

Treasury Secretary Scott Bessent said in an X post on August 17, 2026, that President Donald Trump and Congress delivered the GENIUS Act, creating a landmark framework and clear rules of the road for payment stablecoins, and that Treasury is moving quickly to implement it. He added that the department welcomes input from stakeholders as it works to provide the regulatory framework.

Treasury Defines the Rules for U.S. Stablecoins

On August 17, the Treasury Department issued a Notice of Proposed Rulemaking (NPRM) to implement Section 3 of the Guiding and Establishing National Innovation for U.S. Stablecoins, or GENIUS Act. The law was signed by President Trump in July 2025 after passing both chambers of Congress with bipartisan support, making it the first dedicated federal framework for payment stablecoins in the United States.

The proposal is intended to clarify what counts as issuing a payment stablecoin “in the United States.” That definition will help determine when an issuer must obtain a federal or state license under the new law.

The stakes extend across the sector. Dollar-pegged tokens such as Tether’s USDT and Circle’s USDC sit at the center of crypto trading and payments, functioning as the market’s primary dollar-settlement rails. Under the GENIUS Act, licensed issuers must back payment stablecoins one-to-one with high-quality liquid assets such as U.S. currency, insured bank deposits, and short-term Treasuries, and issuers whose outstanding stablecoins exceed $50 billion fall under federal supervision rather than approved state regimes.

Treasury is also proposing a definition of “offered or sold” to a person in the United States for a payment stablecoin. These definitions could determine whether crypto businesses fall inside or outside the scope of the GENIUS Act.

Bessent said the department is making swift progress on the framework, which is designed to provide businesses and investors with more clarity and foster innovation with cryptocurrencies in the U.S.

Key GENIUS Act Deadlines

The first major deadline is January 18, 2027, when the GENIUS Act is projected to take effect. From that date, it will be illegal to issue a payment stablecoin in the United States without the proper federal or state license.

The bill also includes provisions covering payment stablecoins issued abroad. In general, digital asset service providers are not authorized to offer, sell, or otherwise make those stablecoins available unless the foreign issuer can comply with lawful U.S. orders and meet applicable requirements under its arrangements with its home jurisdiction.

A second major restriction takes effect on August 1, 2028. From that date, digital asset service providers will no longer be allowed to offer or sell payment stablecoins to U.S. persons unless they rely on stablecoins from a licensed issuer.

Treasury Opens 60-Day Public Comment Period

The NPRM is not a final rule. Treasury is opening the proposal for public comments and suggestions.

Once the notice is published in the Federal Register, there will be a 60-day public comment period. Comments submitted through the federal rulemaking process will be made publicly accessible.

The new proposal follows an earlier NOPR published by Treasury in September 2025, which sought comments on many of the detailed issues involved in implementing the GENIUS Act.

The latest step gives stablecoin issuers, exchanges, and other crypto industry service providers, including developers, an opportunity to comment before Treasury finalizes the rules.

Treasury’s task now is to define the parameters for domestic stablecoin issuers and consumers in the U.S. market before the 2027 licensing deadline. Items to watch as the rulemaking proceeds include how the final definitions of “in the United States” and “offered or sold” treat foreign issuers and offshore platforms, and whether the rule is finalized in time for issuers and service providers to complete licensing and transition ahead of the January 2027 and August 2028 deadlines.