The NCUA has proposed rules under the GENIUS Act for federally insured credit unions to become federally supervised payment stablecoin issuers. The proposal outlines the process for licensing and standards for such issuers, including requirements related to reserves, capital, liquidity, illicit finance, and IT risk management.

Federally insured credit unions would need an NCUA PPSI license to invest in payment stablecoin issuers. The proposal prohibits investments or loans to issuers without the license. A forthcoming proposal will implement GENIUS Act standards and restrictions for PPSIs, with a focus on licensing and investment limits.

The NCUA cannot deny applications solely based on stablecoin issuance on public blockchains. Once an application is deemed complete, the agency has 120 days to approve or deny it. Insured depository institutions, including credit unions, must use separately supervised subsidiaries to issue payment stablecoins.

Stakeholders have 60 days to comment on the proposed rulemaking. The document is not final and may be revised before implementation. Cointelegraph reached out to NCUA for further comments. The news article is produced according to Cointelegraph’s Editorial Policy for accurate and transparent journalism.

Read more at CoinTelegraph: NCUA Suggests GENIUS Act Rules for Credit Union Stablecoin Issuers