Fed Proposes Capital Charges and Approval Rules for Stablecoin Issuers

The significance here is jurisdictional: the Fed is staking out how bank-issued stablecoins will be capitalized and supervised, rather than leaving the framework to the GENIUS Act alone. Two-business-day redemption is the operational crux, since it ties reserve composition and liquidity directly to capital treatment, affecting banks weighing whether issuance is worth the balance-sheet cost. Whether the 120-day clock becomes a genuine constraint on approvals, and how these charges stack up against other regulators' treatment of non-bank issuers, is the open question.