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– The Federal Reserve took one of its first significant steps toward implementing the GENIUS Act less than a month after Kevin Warsh took office as Fed Chair.

On June 18, the Fed, along with four other U.S. financial regulators, issued new customer identification requirements for certain issuers of payment stablecoins, bringing them closer to the compliance standards already applied to banks and credit institutions.

This proposal is the Feds first official regulatory action related to the GENIUS Acta major piece of legislation on stablecoins signed by President Donald Trump in July 2025.

Under the proposals, certain issuers of payment stablecoins would be required to implement customer identification procedures similar to those used by banks and credit institutions.

The proposal applies only to stablecoin issuers operating under the regulatory framework of the GENIUS Act, including certain bank subsidiaries, federally chartered nonbank issuers, and qualified state-regulated entities. This rule does not apply to all stablecoin issuers.

This rule was issued jointly by the Federal Reserve, the Financial Crimes Enforcement Network (FinCEN), the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the National Credit Union Administration.

The regulatory agencies will accept public comments for 60 days following the publication of the proposal in the *Federal Register*.

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According to the agencies, these requirements are aimed at strengthening anti-money laundering (AML) measures, improving customer verification procedures, and helping to combat illegal financial transactions involving payment stablecoins.

Trending on TheStreet Roundtable:

The proposal quickly caught the attention of the entire cryptocurrency industry and political analysts.

Custodia Bank CEO Caitlin Long noted that the Fed has joined this initiative and described it as the Feds first BRILLIANT regulatory move.

She also pointed out that Warsh abstained from voting, while Fed Governor Michael Barr issued a separate statement.

Long later stated: Warshs abstention on this issue is unusual, and he did not provide any explanation.

This move came during Warschs first month as Fed Chair and followed his broader analysis of the Feds activities at the June 1617 FOMC meeting.

Federal Reserve Board member Michael Barr said he supports the proposal, but remains concerned that the regulatory framework of the GENIUS Act may not fully mitigate the risks of illicit financing in secondary market stablecoin transactions.

Nevertheless, I remain concerned that the regulatory framework of the GENIUS Act does not yet provide sufficient measures to address the risks of illicit financing carried out through secondary market transactions involving payment stablecoins, Barr said.”,”detected_source_language”:”RU