NCUA Proposes Stablecoin Standards for Credit Union Subsidiaries Under GENIUS Act

The National Credit Union Administration has issued a Notice of Proposed Rulemaking establishing operational, compliance, and risk management standards for NCUA-licensed permitted payment stablecoin issuers under the GENIUS Act. The proposal is designed to outline how credit unions could participate in the emerging stablecoin marketplace while maintaining regulatory safeguards comparable to those applied to banks and other financial institutions.

The proposed rule supplements the agency’s early February 2026 rulemaking, which primarily focused on the application and licensing process for stablecoin issuers. Under the latest proposal, federally insured credit unions would not be permitted to issue stablecoins directly. Instead, the digital assets could only be issued through separately licensed subsidiaries overseen by the NCUA.

The framework would establish standards related to governance, liquidity, reserve management, operational resiliency, compliance, cybersecurity, and overall risk oversight for entities seeking NCUA approval to issue permitted payment stablecoins. The agency said the rule is intended to align with broader federal efforts to create a consistent regulatory structure for digital assets and payment stablecoins.

“This proposed rule supports my view that credit unions will face no disadvantage compared to other entities regarding standards,” NCUA Chairman Kyle Hauptman said in a statement. “Stakeholders will see that we worked diligently to align the standards for NCUA-licensed PPSIs with the standards that are proposed for bank subsidiaries.”

The proposal also includes provisions addressing share insurance disclosures, and clarifications related to tokenized shares and payment stablecoin activities. In addition, the NCUA would limit federally insured credit unions to investing only in NCUA-licensed PPSIs.

The GENIUS Act requires federal regulators to finalize implementing regulations by July 18, 2026, ahead of the law’s broader implementation timeline in 2027. Stakeholders may submit comments on the proposal through July 17, 2026.