U.S. Treasury's proposed stablecoin rules: what to do before the GENIUS Act takes effect

The US Department of the Treasury proposed rules (opens in a new tab) on August 17, 2026 implementing section 3 of the GENIUS Act. The proposal answers two questions the statute left open:

1. What it means to issue a payment stablecoin in the United States, which determines when an issuer needs a GENIUS Act license.
2. What it means to offer or sell a payment stablecoin to a person in the United States, which determines when and how stablecoins can be sold in US markets.

The GENIUS Act became law on July 18, 2025 and directs Treasury to write regulations implementing section 3 (this proposal). The rule adds definitions, worked examples, and the § 1523.2(c) and § 1523.3(e) protections for firms that keep US persons out.

Section 3 is intended to have extraterritorial effect where conduct involves an offer or sale to a person located in the US.

What the proposal covers: issuance, offer, and sale.

What the proposal doesn't cover:

• Reserves and capital (handled by the Office of the Comptroller of the Currency (OCC) and other federal payment stablecoin regulators)
• Anti-money laundering (AML) and sanctions programs (proposed separately by FinCEN in April 2026 and by OFAC)
• Whether a state regime qualifies as substantially similar to the federal framework (proposed separately by Treasury in April 2026)
• Accounting and margining under section 3(g)

What counts as a payment stablecoin

A payment stablecoin is a digital asset that is, or is designed to be, used as a means of payment or settlement, where the issuer is obligated to convert, redeem, or repurchase it for a fixed amount of monetary value and represents that it will hold a stable value.

The statutory term "payment stablecoin" is narrower than how "stablecoin" as most people use it. A token with no issuer obligated to redeem it may fall outside the definition.

Three categories are excluded by statute: national currencies, deposits as defined in section 3 of the Federal Deposit Insurance Act (including deposits recorded using distributed ledger technology), and securities. A tokenized deposit that remains a deposit isn't a payment stablecoin.

This boundary may move. Question 5 asks whether the definition should reach digital assets redeemable only in credit union shares, or only in non-deposit liabilities that the public treats as convertible to bank deposits. Products sitting near that line could end up inside the definition.

Deadlines

These dates come from the GENIUS Act itself, so they apply regardless of what happens to this proposal. January 18, 2027 the expected effective date but can arrive earlier if the primary federal regulators finalize their rules first. The § 1523.3(b) obligation arrives first and covers every foreign-issued stablecoin you support.

Does Section 3 apply to you?

There are two triggers, affecting different people.

1. Issuing applies to any person who issues a payment stablecoin in the US. There's no entity-type filter. The penalties for participating in an unlawful issuance under § 1523.2(d) also reach any person.
2. Offering and selling applies to digital asset service providers (DASPs). Section 2(7) defines a DASP as a person who, for compensation or profit, engages in the business in the US of:
3. 1. exchanging digital assets for monetary value or other digital assets
   2. transferring digital assets to a third party
   3. acting as a digital asset custodian, or
   4. participating in financial services relating to digital asset issuance

If you offer, sell, move, or custody stablecoins for customers

1. Inventory every stablecoin you touch. For each: who is the issuer, where are they organized, where is their principal place of business, and is a section 8 secondary trading prohibition in effect. This is the input to everything below.
2. Get a written representation from each foreign issuer that it "has the technological capability to comply, and will comply" with lawful orders and any reciprocal arrangement under section 18. § 1523.3(c) lets you rely on one.
3. Do diligence on that representation, and keep doing it. You can't rely on the representation if you "know, have reason to know, or should know" it's false. Diligence must always include confirming that no section 8 prohibition is in effect, and must go further to consider all reasonably available information.
4. 1. Under section 8, the Secretary can designate a foreign issuer as noncompliant with lawful orders, publish that designation in the Federal Register, and impose a prohibition on US secondary trading of that issuer's stablecoins by DASPs. Designations publish on a rolling basis, and "will comply" is forward-looking, so this involves monitoring.
4. Build to § 1523.3(e) if you serve non-US users and want protection against inadvertent sales. There are tree conditions:
5. 1. reasonable belief the person isn't located in the US
   2. implemented policies and controls reasonably designed to avoid US sales
   3. no advertising or solicitation that targets or could be expected to target US persons.
5. Don't treat controls as static. Treasury says controls "cannot be said to be reasonably designed if they are static." They must be implemented in operations (not adopted on paper), and reviewed and updated as technology changes and in response to any identified sale to a US person.
6. Fix your inbound sales scripts. Responding to an unsolicited inquiry counts as an offer. See full list below.

The five activities that count as an offer or sale

T gives five non-exhaustive examples in § 1523.3(d). It also treats "offer," "sell," and "make available" as overlapping because the Act defines "offer" as making available for purchase, sale, or exchange. Listing without selling isn't a way out.

Separate exposure for marketing: section 4(e)(3) makes it unlawful to market a product in the US as a payment stablecoin unless it's issued under the GENIUS Act, with penalties for knowing and willful participation. Treasury says that conduct covered by this proposal may also trigger § 4(e)(3), and that guidance on that provision is outside this rulemaking.

If you issue a stablecoin, or plan to

1. Check whether you're "located in the United States." For entities that means organized under US or state law, or principal place of business in the US. Either one is enough.
2. Foreign issuers: build to § 1523.2(c). There are four conditions. Meeting all four protects you even against an inadvertent issuance to a US person.
3. 1. You're not located in the US
   2. You reasonably believe every recipient isn't either
   3. You've adopted and implemented controls reasonably designed to avoid issuing to US persons
   4. You don't advertise or solicit in a way that targets them
3. Assume the DASP rules apply to you too. Treasury proposes that issuers are also digital asset service providers, on the reasoning that redemption is itself an exchange of digital assets for monetary value. Both rule sets run at once.
4. SCRC approval may still apply. § 1523.2(a) doesn't enumerate every prerequisite to issuing. Approval from the Stablecoin Certification Review Committee under § 4(a)(12) may still be required.

If you help someone else launch

Section 3(f) sets penalties up to $1 million per violation and five years imprisonment for knowing participation in an unlawful issuance. § 1523.2(d) gives three examples:

1. Taking on an obligation to convert, redeem, or repurchase, including a secondary obligation behind the original issuer
2. Coordinating with the issuer on key steps such as soliciting customers or minting
3. Acting as market maker, distributing to purchasers, or otherwise making the new coin available for secondary trading

Treasury expects the third to cover an exchange listing an unregistered stablecoin shortly after issuance. It doesn't intend to cover buying a smaller amount for your own use (as opposed to immediate resale in a dealer capacity), or secondary trading without a close temporal nexus to issuance. They add that secondary trading of unregistered stablecoins at any time can still implicate the § 3(b) offer and sale prohibitions, so falling outside § 1523.2(d) doesn't end the analysis.

White-label partners: supplying your branding doesn't make you the issuer, since you have no redemption obligation. Treasury says it may still count as facilitating key steps in the issuance.

If you only accept or hold stablecoins

Probably outside § 3, but the proposal doesn't say so directly. The offer and sale rules only reach digital asset service providers, and that definition requires being in the business of one of the four section 2(7) activities for compensation or profit. Taking payment in stablecoins or holding them on your own balance sheet isn't obviously any of the four.

One thing to check with your counsel: the transaction exemptions in § 1523.4(c) are all written around individuals, covering peer-to-peer transfers between two individuals, an individual moving funds between their own accounts at the same parent company, and self-custody by an individual. A company self-custodying its own treasury doesn't fit the text of any of the three.

Key definitions: issue, issuer, located in the US, and offer

These decide whether a given action counts as an issuance or an offer, which are what the prohibitions attach to.

• Issue means the first transfer by the issuer that gives someone else the right to use, transfer, or redeem. Minted tokens held in treasury aren't issued. Minting straight into a holder's wallet is issued. Crediting an account counts even if the token never moves, which catches issuers who also custody.
• Reissuance is a new issuance. After redemption or reacquisition, the next transfer out counts again, whether or not you burned the original.
• Issuer means whoever is obligated to redeem and represents it will hold a stable value. Doing the technical minting or lending your brand doesn't make you one.
• Located in the US, for individuals, means physically present, with a carve-out for temporarily present non-residents. A US resident temporarily abroad is not located in the US. This is a point-in-time question about where someone is.
• Offer includes presales of stablecoins that haven't been issued yet.
• United States includes DC, the territories, Indian lands, and the Insular Possessions.

Airdrops, lockups, and listings stay in scope

Treasury addresses arrangements that companies might assume fall outside section 3.

• Reverse solicitation isn't a defense. Under § 1523.3(d)(3), responding to an unsolicited inquiry from a US person by indicating willingness to sell is an offer. § 1523.3(e) doesn't save you, because its first condition is reasonable belief the person isn't in the US, and here you know they are.
• Airdrops are issuances. Appendix A, Interpretation 2: minting and airdropping a new stablecoin for no consideration to a US resident physically in the US is an issuance in the US.
• Lockups don't delay issuance. Interpretation 4: a coin that isn't redeemable until a future date has still been issued. Treasury rejected the contrary reading because it "would facilitate evasion of section 3(a)."
• Listing coordination is its own exposure. Interpretation 3: an exchange that coordinates with an issuer to list a new coin isn't the issuer, but may have participated in the issuance under § 1523.2(d) and may be offering or selling under § 1523.3.

What's still unresolved in GENIUS Act

Treasury asks 87 questions in the proposal. These are some open items that can affect your planning.

• No de minimis safe harbor. Treasury has authority for one under § 3(c)(1) and didn't propose it. It considered a longer transition paired with a safe harbor for smaller unregistered foreign-issued stablecoins, using under $1 billion in US-held capitalization as the example threshold, and decided against. Question 73 reopens it. The only relief in § 1523.4 is the pending-applicant waiver, an emergency authority, and the three statutory transaction exemptions.
• Bridging, wrapping, and cross-chain movement. Questions 19 through 21 ask whether moving a stablecoin between chains is a new issuance, whether a bridge operator can itself be an issuer, and whether wrapped tokens and deposit receipts count. Nothing here is settled, and it's the largest open question for multichain products.
• Whether reverse solicitation gets carved out. Question 63 asks whether offers or sales that follow an inbound inquiry should fall outside § 1523.3. Question 37 asks the same for issuance under § 1523.2.
• Which controls actually count. Questions 38 and 62 list customer identification, account opening data, geographic access restrictions, device or network location checks, contractual representations, and transaction monitoring, without committing to any.
• Cross-border payments and foreign exchange. Question 75, on US financial institutions transacting in foreign-issued, foreign-currency stablecoins. Question 74 covers state qualified issuers whose SCRC certification is pending, lapsed, or denied.

Two alternatives still in consideration that would change everything above:

1. Per se unlawful. Any issuance or sale to a US person would be unlawful regardless of what diligence you did, removing §§ 1523.2(c) and 1523.3(e), the two provisions most companies would build toward. Questions 44 and 64.
2. Regulation S offshore framework. The location test would be replaced with an offshore transaction framework modeled on Regulation S under the Securities Act. Questions 45 and 65, with 46 through 50 and 66 through 70 on how it would work in practice.

Compliance is continuous

Diligence on a foreign issuer tests a forward-looking claim about future compliance. Section 8 designations publish on a rolling basis. And the controls in §§ 1523.2(c) and 1523.3(e) have to be updated in response to any identified issuance or sale to a US person, which means you need to be able to detect one in the first place.

That's the same pattern as MiCA, where authorization takes 6 to 12 months and staying compliant afterward is a permanent operational commitment. It rests on knowing which stablecoins move through your product, who issued each one, and where they came from, which is a digital asset lineage problem first.

Goldsky gives teams real-time data across the chains stablecoins move on, so token flows, issuer attribution, and counterparty activity stay queryable auditable at all times. See compliance monitoring or get in touch about staying prepared whichever way the rule lands.

Summary of a proposed rule, not legal advice. Citations are to the NPRM as submitted to the Office of the Federal Register (opens in a new tab) on August 17, 2026, docket TREAS-DO-2026-0496, scheduled for publication on August 18. The Federal Register version is the official document.