Regulators move to apply decades-old bank compliance standards to digital asset issuers
The Federal Reserve proposed on Thursday that payment stablecoin issuers maintain written customer identification programs, signaling Washington’s determination to bring digital asset markets under the same anti-money laundering discipline long applied to traditional banks.
The proposal requires stablecoin issuers to collect customer identification data before account opening or direct token redemption. Required information includes legal name, date of birth, physical address, and government ID number. The rule mirrors obligations that banks, broker-dealers, mutual funds, and futures commission merchants have operated under for more than two decades.
The move flows from the Genius Act, which President Trump signed into law in July 2025. That statute created the first federal regulatory system for stablecoins and mandated 100% reserve backing with liquid assets. It subjected stablecoin issuers to the Bank Secrecy Act for the first time, requiring them to establish anti-money laundering, sanctions compliance, and customer identification programs.
Michael Barr, Federal Reserve Governor, framed the rulemaking as essential to closing compliance gaps. “While some digital asset service providers are subject to anti-money laundering and anti-terrorist financing requirements in their home jurisdiction, it is far too easy for bad actors to evade these restrictions and operate without detection when transacting in digital assets,” Barr said.
In April 2026, the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) and the Office of Foreign Assets Control (OFAC) issued a joint proposed rule on anti-money laundering and sanctions compliance. That rule would carve payment stablecoin service issuers out of the existing money services business category and treat them as a distinct class of Bank Secrecy Act-covered financial institutions.
The FDIC and OCC each issued separate notices of proposed rulemaking covering licensing, reserves, capital requirements, and redemption standards for stablecoin issuers.
The Federal Reserve’s customer identification proposal is open for public comment for 60 days. The Genius Act is scheduled to take effect on January 18, 2027, or 120 days after primary federal regulators issue final rules, whichever is earlier.
Barr has previously cautioned that the Genius Act’s primary text does not resolve material risks around reserve asset quality, regulatory arbitrage, anti-money laundering gaps, and financial stability on its own. According to Barr’s assessment, detailed rulemaking is critical to closing those gaps.
Roughly half of known stablecoin issuers have not registered as money services businesses, according to the regulatory framework being established.
