The U.S. Treasury Department released proposed rules on Monday establishing criteria for issuing payment stablecoins in the United States, setting a regulatory framework intended to shape the market by 2027.
Key dates and licensing requirements
Under the proposal, a new section 1523 would be added to Treasury regulations, outlining when and how both domestic and foreign stablecoin issuers can operate within the U.S. The guidelines set January 18, 2027, as the effective date. After that, it will become unlawful to issue a payment stablecoin in the U.S. without either a federal or state license or a qualifying foreign license. Treasury clarified that foreign issuers must come from jurisdictions with stablecoin regimes the department deems comparable, and those issuers must register with the Office of the Comptroller of the Currency.
From July 18, 2028, digital asset service providers will also be barred from offering or selling these tokens to people in the U.S. unless they were created by a licensed U.S. issuer or a registered foreign issuer meeting Treasury’s standards.
This staged implementation seeks to ensure compliance while offering time for market adaptation. The dual deadlines aim to clarify pathways for both U.S.-based and offshore issuers.
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AAPLForeign issuance and due diligence obligations
Treasury highlighted that, beginning in 2027, platforms cannot list a stablecoin from an offshore issuer unless specific requirements are met. Foreign issuers must demonstrate the capacity and willingness to comply with any lawful order and reciprocal arrangements under the Act. Without strict vetting, platforms would have to delist all foreign-issued stablecoins, a result Treasury moved to avoid.
Instead, platforms may rely on issuers’ attestations if they conduct “reasonable due diligence.” This process must confirm that the issuer faces no secondary-trading ban, consider other accessible information, and stop short if there is cause to question the issuer’s claims.
Mini dictionary: Office of the Comptroller of the Currency (OCC): A U.S. federal agency responsible for regulating and supervising national banks and federal savings associations, including oversight of certain fintech and crypto-related activities.
Treasury declined to base stablecoin oversight on existing U.S. securities law, arguing such a model may work against the transactional purpose of payment stablecoins. Instead, it proposed a conduct-based test, under which an offshore issuer is not considered to have issued tokens domestically if it reasonably believes sales primarily involve overseas buyers, enforces real-world operational controls, and avoids U.S.-targeted marketing.
Penalties and proposed rule exceptions
The proposal expands criminal and civil liability beyond issuers themselves. Entities acting as market makers for unregistered stablecoins, supplying stablecoin brands in “white-label” deals, or organizing new minting or customer solicitation activities could be deemed participants in unlawful issuance.
For knowing violations, the penalties may reach up to $1 million per incident, five years in prison, or a combination of both.
| Violation | Maximum Fine | Imprisonment |
|---|---|---|
| Unlawful issuance participation (knowing) | $1 million | 5 years |
One more lenient path—considering an extended transition period of 36 months and exemptions for offshore tokens with less than $1 billion in U.S.-held capitalization—was discussed but ultimately dismissed. Treasury reasoned that such a runway would delay essential consumer protections without sufficient benefit.
Circle, the company behind the USDC stablecoin, had advocated for equal regulatory requirements regardless of issuer jurisdiction. This position follows ongoing industry debates since the GENIUS Act’s passage in 2023.
Comment period and regulatory goals
The proposal includes 87 specific questions for feedback. A 60-day public comment period will begin Tuesday, providing stakeholders with an opportunity to weigh in on the draft rules.
Treasury Secretary Scott Bessent described the regulatory update as an effort to deliver clarity and stability for businesses, reinforce the U.S. dollar’s global reserve status, and support the country’s prominence in the digital asset sector.
Treasury Secretary Scott Bessent emphasized the department’s intent to “provide the regulatory certainty businesses need to innovate and grow in America, cement the role of the U.S. dollar as the world’s reserve currency, and keep America the crypto capital of the world.”
