President Donald Trump signed the Guiding and Establishing National Innovation for U.S. Stablecoins ($GENIUS) Act into law a year ago, setting the U.S. on a course to establish federal regulations for stablecoins for the first time. A year on, regulators are still working their way through the process of actually crafting the rules that stablecoin issuers will have to abide by.

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Stablecoin rules

The narrative

The $GENIUS Act became law a year ago yesterday, directing federal regulators to begin sorting out how stablecoins should be governed.

Why it matters

The law set up a broad direction for how stablecoin issuers can handle reserves, governance and operational needs, with the details left to agencies like the Office of the Comptroller of the Currency or the Federal Depository Insurance Corporation.

Breaking it down

With the $GENIUS Act's implementation, the U.S. launched its first major federal law addressing cryptocurrencies, even if $GENIUS only targets a small subsection of that sector.

A year on, the rules aren't quite ready for implementation, but we have a much clearer idea as to how the regulators are thinking about stablecoins and where they're likely to land on those rules.

In an emailed statement, Crypto Council for Innovation CEO Ji Hun Kim called the passage of the bill "a landmark moment."

"A year in, agencies, institutions, and innovators are building on a clearer foundation, and stablecoins are moving rapidly toward mainstream adoption," he said.

The various regulators have proposed rules out for comment on the different aspects of stablecoin governance and regulation, including a proposal that would require stablecoin issuers to conduct similar know-your-customer checks to more traditional financial firms. The FDIC published 144 questions a few months ago about how it would oversee stablecoin issuers, looking at concerns like custody, capital and liquidity standards. The OCC, for its part, put out its own proposal in February laying out how it was interpreting the law.

There's still a few months left before these rules start being finalized. And in the meantime, the industry is still working on getting the Digital Asset Market Clarity Act passed.

Clarity watch

The text of the combined Clarity Act drafts is not yet public, at least as of Friday night. While industry sources expected the bill to be released last week, the timeline has constantly evolved. On Thursday, Senators Cynthia Lummis and Bernie Moreno were supposed to brief Trump on the bill. There was no public readout of that meeting available after, but both lawmakers tweeted about Trump's remarks on the election later Thursday.