The Federal Reserve wants stablecoin issuers to pay a direct capital charge for every coin they put into circulation. This move could change how regulated issuers handle growth and risk in the stablecoin market.
Stablecoin issuers under Federal Reserve oversight could soon pay a direct capital charge for every dollar of payment stablecoins they issue. The Fed's new proposal sets a baseline operational-risk capital charge at 2% for the first $20 billion in coins. The rate drops for higher amounts. This means growing a stablecoin's supply would hit the balance sheet right away for regulated issuers, no matter how much they earn from other business lines.
The Fed released this draft framework for public comment on September 24, 2026. The public and industry have 60 days to respond after it appears in the Federal Register. This proposal is part of a bigger push to set clear rules for payment stablecoins. These coins now play a big role in digital assets, on-chain settlements, remittances, and DeFi protocols.
The Fed's proposed rules require stablecoin issuers to maintain a 1:1 reserve ratio with highly liquid assets, such as short-term U.S. Treasury bills, alongside standardized capital requirements for credit and operational risk.
The Fed's draft lays out a marginal capital charge: 2% on the first $20 billion of payment stablecoins, 1.5% on the next $30 billion, and 1% on any amount above $50 billion. These rates only apply to the coins issued within each band. For example, an issuer with $1 billion in circulation and no non-reserve revenue would owe a $20 million baseline operational-risk capital charge. At $10 billion, the charge would be $200 million, still in the first band. The proposal also includes a loss-history adjustment that could move the charge up or down based on actual losses. There's a separate 2% capital charge on certain reserve assets that carry credit risk.
The Fed's proposal would cover subsidiaries of insured state member banks approved to issue payment stablecoins, and some state-chartered issuers that move under Fed supervision through the GENIUS Act. The scope is narrower than the whole dollar stablecoin market. It focuses on entities that meet certain legal and regulatory standards. The Office of the Comptroller of the Currency (OCC) has its own plan. The OCC's March proposal would set a minimum capital amount based on each issuer's business plan and risk profile, with a $5 million floor for new entrants. It would also require a separate pool of liquid assets equal to 12 months of expenses as a backstop. The OCC considered a variable capital charge based on coins outstanding but left it out of its rule text, instead asking for feedback on the idea.
Capital requirements under the Fed proposal are separate from reserve requirements. Covered issuers would have to hold eligible reserve assets with a fair value at least equal to the par value of their outstanding stablecoins. The capital charge is calculated on top of this and can't be met just by holding reserves. For reserve assets that are uninsured deposit claims or undercollateralized reverse repurchase agreements, the Fed wants an extra 2% capital charge to cover credit risk. These rules target different risks: operational risk from running a stablecoin business, and credit risk from the reserves themselves.
Reuters confirms that the Fed's model mandates 1:1 reserve backing and introduces separate capital requirements for supervised stablecoin issuers, directly linking issuance to risk management and operational oversight.
The Fed's proposal came out on September 24, with a 60-day comment period after it hits the Federal Register. The OCC's comment period for its own plan closed on May 1. The final details of the Fed's loss adjustment and the capital and liquidity requirements for stablecoin issuers are still undecided. For regulated issuers, these rules would make stablecoin growth more capital-intensive. This could affect business models and competition. Tying capital charges directly to coins in circulation could also change how new and existing issuers scale their stablecoin offerings.
The stablecoin sector has grown fast in recent years. According to egoncoin.com, total dollar-denominated stablecoin supply across major issuers topped $120 billion in mid-2024. Tether, USD Coin, and Dai are among the largest by market share. Clear rules and capital requirements are now shaping who can compete in this space and at what size.
The Fed's proposal targets operational and credit risks for supervised issuers, but it doesn't cover every stablecoin risk. Depegging events, smart-contract bugs, and off-chain settlement failures are not addressed by these capital rules. As reported earlier, stablecoin liquidity and risk management keep changing as new products and rules appear. The next few months will show how the Fed and OCC finalize their approaches and how issuers adjust to a more capital-heavy regulatory environment.
Capital requirements for stablecoin issuers are a tool to manage operational and credit risks, but they also raise the bar for entry and growth. By tying capital charges to coins in circulation, regulators can shape how fast and how far stablecoins grow among supervised firms. This setup may help bigger, well-funded institutions and make it harder for smaller or new players to scale up. As the rules evolve, finding the right balance between safety, competition, and innovation will stay at the center for both regulators and the market.
