Fed Sets New Rules for Stablecoins, Mixed Reactions from Governors
Federal Reserve Introduces New KYC Rules for U.S. Crypto Firms
The Federal Reserve has rolled out a new set of regulations that will reshape how crypto companies in the United States verify their customers. These rules follow the passage of the GENIUS Act, which formally authorized the issuance of stablecoins—digital currencies pegged to the U.S. dollar.
Key points:
- Collaboration with Federal Agencies
The proposal was developed alongside the Treasury and the FDIC, emphasizing a coordinated approach to crypto oversight.
Mandatory Customer Verification
Crypto firms must now confirm user details such as name, birthdate, and address. Additionally, they are required to cross‑check this information against government lists of terrorists and other prohibited entities.Voting Outcome
All Fed governors approved the proposal except for new chair Kevin Warsh, who abstained without providing a reason. The Fed has yet to issue an official comment.Scope and Loopholes
The rules apply to companies that exchange, move, or hold crypto assets but exclude decentralized protocols. Critics point out that this gap could allow illicit money flows via stablecoins.Public Feedback Window
The Fed will open a 60‑day period for public comments on the new regulations.
