Short answer: On August 17, 2026, the U.S. Department of the Treasury published its first proposed rule under the GENIUS Act, defining when a payment stablecoin counts as issued, offered or sold in the United States. The GENIUS Act stablecoin rules set a licensing deadline of January 18, 2027 for issuers and, from July 18, 2028, limit exchanges serving Americans to stablecoins from licensed or qualifying foreign issuers.
What happened
The Treasury released a notice of proposed rulemaking (NPRM) implementing Section 3 of the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act), the federal stablecoin law signed on July 18, 2025. An NPRM is a draft regulation published for public comment before it becomes final. The document appeared in the Federal Register on August 18, and comments are due by October 19, 2026.
Treasury Secretary Scott Bessent framed the proposal as a step toward giving businesses regulatory certainty. Section 3 is the gatekeeping part of the law: it decides who needs a license and which stablecoins intermediaries may put in front of U.S. customers.
What the GENIUS Act stablecoin rules define
- Issuance is the first transfer of a stablecoin that gives someone else the right to use, transfer or redeem it. Minting into the issuer's own treasury does not count; sending tokens to holders does.
- The issuer is whoever carries the economic obligation to keep the value stable and redeem at a fixed amount, not a technical minter or a brand partner.
- Issuance is "in the United States" if either the issuer or the recipient is located there at the time.
- Offer or sale covers direct solicitation, advertising to U.S. persons and helping users evade location controls. There is no reverse-solicitation escape: answering an unsolicited inquiry from someone in the U.S. would itself count as an offer.
- Safe harbors protect foreign issuers and service providers that reasonably believe a counterparty is outside the U.S., run appropriate controls and do not target Americans, but not if they know or should know otherwise.
Knowingly issuing a payment stablecoin without authorization carries penalties under the law of up to $1 million per violation and up to five years in prison.
Key deadlines for issuers and exchanges
| Date | What changes | Who is affected |
|---|---|---|
| October 19, 2026 | Public comment period on the proposal closes | Industry, public |
| January 18, 2027 | GENIUS Act effective: issuing to U.S. users requires a federal or state license; foreign stablecoins may be offered only if the issuer can comply with U.S. lawful orders | Issuers, exchanges, brokers |
| July 18, 2028 | Service providers may offer U.S. persons only stablecoins from licensed U.S. issuers or qualifying foreign issuers | Exchanges, brokers, wallets with custody |
What it means for USDT and foreign stablecoin issuers
The biggest open question is the treatment of foreign payment stablecoin issuers, the category that includes Tether, whose USDT is by far the largest stablecoin with a market value of roughly $183 billion. The Treasury took a permissive reading: a foreign issuer may issue directly into the U.S. if the Treasury determines that its home jurisdiction has a comparable regulatory regime. The catch is that the process for making that comparability decision has not yet been proposed. Law firm Freshfields noted a "notable gap" between the 2027 and 2028 dates, during which exchanges may not know which foreign stablecoins will remain eligible.
Tether has already hedged by launching a separate U.S.-focused token, USAT, while Circle's USDC is issued by a U.S. company. For global users outside the U.S., nothing changes directly, but the rules will shape which stablecoins large U.S.-connected venues list and how liquidity is split across tokens.
What it means for you
- No immediate change to your holdings. This is a draft; USDT, USDC and other stablecoins keep working as before, and self-custody and peer-to-peer transfers are exempt under the statute.
- Watch listings, not headlines. The practical impact will come through exchanges and brokers serving U.S. users adjusting which stablecoins they support ahead of 2027 and 2028.
- Diversify issuer risk. Holding a meaningful balance in more than one stablecoin reduces exposure to any single issuer's regulatory outcome; see our stablecoin explainer for how issuers differ.
- Mind the network. Where a stablecoin lives matters as much as who issues it; our guide to USDT networks compares fees and support.
Key takeaways
- The Treasury proposed its first GENIUS Act rule on August 17, 2026; comments close October 19, 2026.
- Issuing payment stablecoins to U.S. users requires a license from January 18, 2027.
- From July 18, 2028, U.S.-facing service providers may offer only licensed or qualifying foreign stablecoins.
- Foreign issuers such as Tether get a path in, but the comparability process is still undefined.
If you want to rebalance between stablecoins or move them to a cheaper chain, you can compare available routes on the exchange pairs page before sending anything.
Sources: U.S. Treasury, Federal Register, Freshfields, Coinpaprika
Frequently asked questions
When do the GENIUS Act stablecoin rules take effect?
The licensing requirement for issuers starts on January 18, 2027. From July 18, 2028, U.S.-facing service providers may only offer payment stablecoins from licensed U.S. issuers or foreign issuers that qualify under a comparable-regime determination.
Will USDT be banned in the United States under the GENIUS Act?
Not automatically. The proposal gives foreign issuers such as Tether a path to the U.S. market, but only if the Treasury finds their home regime comparable and the issuer can comply with U.S. lawful orders; that determination process has not been proposed yet.
Does the GENIUS Act rule affect self-custody wallets?
Transfers between self-custody wallets and peer-to-peer transfers are exempt under the statute. The rule targets issuers and digital asset service providers such as exchanges and brokers that offer stablecoins to people in the United States.
