The Federal Deposit Insurance Corporation (FDIC) recently took a significant step regarding stablecoins. They approved a proposal to implement rules from the Guiding and Establishing National Innovation for U.S. Stablecoins Act, also known as the GENIUS Act. This act allows banks insured by the FDIC to issue payment stablecoins through a subsidiary.
Here’s what this means. If a state bank or savings association wants to issue stablecoins, they must apply to the FDIC. The FDIC will evaluate these applications based on specific requirements laid out in the GENIUS Act. This includes a structured application process, clear timelines for processing, and an appeals process for any rejections.
Stablecoins, which are digital currencies pegged to stable assets like the U.S. dollar, have gained popularity. According to a recent report from the Blockchain Research Institute, the global stablecoin market was valued at around $30 billion in 2022, indicating significant growth and interest.
Experts are eyeing this move closely. Financial analysts believe that allowing banks to issue stablecoins could increase trust and stability in the cryptocurrency market. However, there are concerns about regulation and oversight, especially given that the digital currency space can be volatile.
As the FDIC moves forward, they will take public comments on this proposal for the next 60 days. Public input is crucial, as it helps shape effective regulations that benefit consumers and foster innovation.
For more details, you can read the full proposal when it publishes in the Federal Register.
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