Points of Focus

• US regulators propose bank-style ID checks for stablecoin issuers under the GENIUS Act.
• Issuers would need to verify customers, retain records, and screen against terrorist watchlists.
• Federal Reserve Governor Michael Barr questioned whether the rules go far enough to cover secondary market activity.

Stablecoin issuers operating in the United States could soon face the same customer screening obligations as banks and brokerages as federal regulators move to implement Anti-Money Laundering (AML) provisions contained in the GENIUS Act. The proposal marks one of the first major implementation measures since Congress approved the law in July 2025, setting out how stablecoin issuers would comply with AML requirements in practice.

The Financial Crimes Enforcement Network (FinCEN), the Federal Reserve, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the National Credit Union Administration jointly released the proposed rule on June 18 and opened a 60-day public comment period before issuing final requirements.

🚨JUST IN (June 18, 2026):
The Federal Reserve, FinCEN, OCC, FDIC, and NCUA jointly proposed requiring permitted payment stable coin issuers to maintain effective Customer Identification Programs (CIP/KYC).

The rules would be similar to those already required for banks and… pic.twitter.com/0yPYBXMwL9

— Sam Price (@CryptoLifer33) June 18, 2026

Stablecoin issuers could face bank-style KYC obligations

The proposal would classify permitted payment stablecoin issuers, known as PPSIs, as financial institutions under the Bank Secrecy Act. As a result, issuers would need to maintain written customer identification programs tailored to their size, business model, and risk exposure.

Under the draft framework, issuers would be required to collect and verify information such as a customer’s legal name, address, date of birth, and identification number when opening an account. Companies would also need to retain records used during the verification process and check whether customers appear on government lists of known or suspected terrorists or terrorist organizations.

The requirements resemble existing customer identification rules applied to banks, broker-dealers, mutual funds, and futures commission merchants. Regulators said the framework is designed to mitigate illicit finance risks while safeguarding the US financial system and national security interests.

FinCEN estimated that roughly 50 PPSIs could fall under the rule during each of its first three years, with more than half expected to be subsidiaries of insured depository institutions.

Secondary market activity remains an open question

The proposal focuses primarily on customers who establish direct relationships with issuers through activities such as minting or redeeming stablecoins. Regulators have yet to decide whether similar checks should apply once tokens begin circulating between users, self-custodied wallets, and merchants.

Federal Reserve Governor Michael Barr highlighted that issue in a statement accompanying the proposal. Barr supported the customer identification proposal but said the broader GENIUS Act framework still leaves gaps around illicit finance risks in secondary market transactions.

Regulators are seeking feedback on whether customer identification obligations should extend beyond issuer-customer relationships and what benefits or drawbacks such an expansion would create.

The agencies received about 450 comments after seeking preliminary feedback in September 2025. Regulators are accepting comments on the latest proposal for 60 days after its publication in the Federal Register before considering final joint rules.