The latest US stablecoin draft 15 Questions and 15 Answers: Who can issue it? What are the core requirements?

Author: KarenZ, Foresight News

This week, Bryan Steil, chairman of the U.S. Digital Assets Subcommittee and French Hill, chairman of the House Financial Services Committee, formally proposed the Stability Act, the STABLE Act of 2025, which established a framework for issuing and operating payment stablecoins in the United States. French Hill said, “The bill is the culmination of months of cooperation with stakeholders and members in this and last Congress.”

This article uses 15 common questions and answers to take you a comprehensive understanding of the purpose of the bill, the relevant requirements for the issuer and custodian, and regulatory compliance matters.

Who proposed it? What is the purpose?

Who brought the bill?

The draft bill could also be called the Stable Coin Transparency and Responsibility Promotion Ledger Economy Act 2025, proposed by Rep. Bryan Steil and French Hill. Among them, Bryan Steil is the chairman of the House Management Committee and the chairman of the U.S. House Financial Services Committee’s Crypto Subcommittee. French Hill is the new chairman of the U.S. House of Representatives Financial Services Committee.

Which type of stablecoins are mainly used to regulate?

The bill aims to ensure transparency and accountability of payment stablecoins through regulatory frameworks, the issuance and circulation of payment stablecoins, protect consumers, ensure financial stability, and prevent illegal financial activities, while promoting the application of stablecoins in a better ledger economy.

What is Payment Stablecoin?

This bill defines payment stablecoins as:

• A digital asset designed to be used as a means of payment or settlement

• Denominated in national currency.

• The issuer is obliged to exchange, redeem or repurchase at a fixed amount of monetary value.

• Not a national currency, not a securities issued by an investment company.

Stablecoin Issuance

Who can be allowed to issue payment stablecoins?

Only the Permitted Payment Stablecoin Issuer can issue stablecoins, including:

• Approved insurance depository subsidiaries

• Federally certified non-bank payment stablecoin issuer

• State-certified payment stablecoin issuer

What are the core requirements for issuing payment stablecoins?

• Reserve requirements : The issuer must hold reserve assets (1:1 support) of no less than 100% of the total outstanding stablecoins, including US dollar cash, Federal Reserve deposits, current deposits of deposited institutions, short-term US Treasury bonds (due within 93 days), overnight repurchase agreements with specific conditions, and money market funds invested in the above assets.

• Redemption Policy : Publicly disclose the redemption policy and establish a timely redemption procedure.

• Transparency : A monthly reserve composition report is issued and inspected by an independent certified public accounting firm, and written proof of the CEO and CFO.

• Consequences of false certification:

• Intentional violation : up to 20 years in prison + $5 million fine;

• Negligent violation : up to 10 years in prison + $1 million fine.

• Capital and Risk Management : Comply with capital, liquidity, risk management (including operations, compliance, IT, cybersecurity) and other requirements set by major federal payment stablecoin regulators.

• Business restrictions : Mainly limited to direct support activities such as issuing, redemption of stablecoins, managing related reserves and providing custody.

• Interest payment is prohibited : Interest or income shall not be paid to stablecoin holders.

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What are the qualification requirements for relevant custodians?

Financial institutions (such as banks, trust companies) that are regulated by federal or state only and meet relevant standards can provide relevant custody services.

What are the requirements for custody in the bill?

• Customer assets need to be isolated and it is prohibited to be confused with their own funds.

• Client assets take precedence over issuer creditors.

• It is prohibited to include customer assets in their own balance sheets.

• Regularly submit instructions on the custody operation process to the regulatory authorities.

Regulation and compliance

Who is responsible for regulating stablecoin issuers?

The major federal payment stablecoin regulators are the Comptroller of the Currency (OCC), the U.S. Federal Reserve, the U.S. Federal Deposit Insurance Corporation (FDIC), and the U.S. Credit Union Administration (NCUA). Specifically

• For deposited institutions (non-credit unions) and their subsidiaries: appropriate federal banking institutions

• For insured credit unions and their subsidiaries: State Credit Union Administration

• For federally certified non-bank payment stablecoin issuers: Currency Complaint.

How do states establish their own stablecoin regulatory system?

State-qualified payment stablecoin issuers can only issue payment stablecoins according to the supervision of relevant state-based payment stablecoin regulators. State regulators can submit certification to the U.S. Treasury Department to prove that their regulatory regime meets or exceeds federal standards.

What are the regulations for foreign stablecoin issuers?

The bill allows foreign payments to be circulated in the United States, but requires strict conditions: the regulatory system must be comparable to that of the United States, and the issuer agrees to accept reports and inspection requirements determined by U.S. regulators. The Minister of Finance is responsible for assessing and coordinating international cooperation and publicizing and updating the list of eligible countries.

Among them, if the issuer is a non-bank entity, it is determined by the Office of the Supervision of Monetary Affairs; if the issuer is a banking institution or its subsidiary, it is determined by the Federal Reserve.

What punishment will be given for violating the bill?

What punishment will be received if a stablecoin issuer violates the Stability Act?

Under the STABLE Act of 2025, if a stablecoin issuer (including a licensed issuer and its affiliates) or an unlicensed issuer violates the provisions of the Act, it will face a series of severe penalties that are enforced by the corresponding federal or state regulator:

1. Compulsory regulatory measures:

• Suspension or revocation of issuance : If the major federal payment stablecoin regulator determines that the issuer or its institutional affiliates are seriously violating this Act, the licensed issuer may be prohibited from continuing to issue payment stablecoin.

• Stop Order : If the major federal payment stablecoin regulator has reasonable grounds to believe that the issuer or its institutional affiliates are breaching, having violated or attempting to violate this Act, regulation, order, written agreement or condition, it may order it to cease and terminate such violations or practices and take positive action to correct the circumstances resulting from the violation.

• Removal and prohibited participation : The major federal payment stablecoin regulator may remove the issuer’s institutional affiliates or prohibit its further participation in the issuer or all licensed issuers. The premise is to determine that the affiliated party directly or indirectly violates or tries to violate this Act, regulation or order; violates the relevant laws on anti-money laundering of the United States Code.

2. Civil fines

• Unauthorized issuance : Any entity that issues payment stablecoins without approval (and related parties who knowingly commit an affiliated party) will be subject to a civil fine of up to $100,000 per day, with a penalty period of each day of such payment stablecoins outstanding.

• Level 1 Violation : A civil fine of up to $100,000 per day for a licensing issuer or its affiliates if a substantial violation of the Act, relevant regulations, orders or written agreements/conditions is imposed.

• Second-level Violation : In addition to the possible first-level fine, additional civil fines may be imposed up to $100,000 per day if the issuer or its affiliates are permitted to intentionally participate in violation of the Act or related regulations/orders.

3. Criminal Punishment

False Proof: If the issuer's CEO or CFO submits a monthly reserve certification report containing material false information, he or she faces criminal prosecution:

• Knowing that the report is false: fines up to $1 million, imprisonment for up to 10 years, or both.

• Deliberate filing of false reports: fines up to $5 million, imprisonment for up to 20 years, or both.

False statements insured status: If a false claim is made that the stablecoin is guaranteed by the U.S. government or FDIC/NCUA insurance, it will be prosecuted under existing laws.

Civil fines: Unlicensed issuance or violation of the sale regulations, up to US$100,000 per day; substantial violations are up to 100,000 per day, and informed violations may be additional 100,000.

Criminal Penalties: False certification for false reserves is fined up to 5 million yuan and imprisonment for 20 years.

Regulatory measures: suspend or revoke the issuance of a license, issue a stop order, and remove related parties.

Misleading penalties: False insurance statements are pursued under federal law.

Temporary Measures: Issuing a temporary cessation order in an emergency.

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Is payment stablecoins recognized as securities?

The bill explicitly excludes payment of stablecoins from the definition of "securities".

How to ensure the interoperability of stablecoins?

Federal regulators will evaluate and develop standards with agencies such as the National Bureau of Technology and Information Services (NIST) to promote compatibility and interoperability of payment stablecoins.

When will regulators issue implementation rules?

Within 180 days (about 6 months) after the bill comes into effect, major federal payment stablecoin regulators must jointly issue detailed rules for implementing payment stablecoin issuance requirements.

When will the bill come into effect?

• For any non-licensed payment stablecoin issuer, issuing payment stablecoin is illegal on the date of enactment of the bill.

• For custodial intermediaries, the provision or sale of payment stablecoins not issued by the "licensed payment stablecoin issuer" will not begin to be banned 2 years after the date of the bill's enactment. This gives the market a longer transition period to adapt.

• The procedure for approving the issuance of stablecoins by depositary institutions or non-bank entity subsidiaries will be effective on one of the following two dates:

• 12 months after the date of the promulgation of the bill;

• 120 days after the date of the release of the final regulations for Section 5 by major federal payment stablecoin regulators.

• Regarding the "endogenic mortgage stablecoins ban", it will take effect immediately on the date of the promulgation of the bill and will last for 2 years.

It should be noted that the draft bill has been submitted to the House Financial Services Committee and will be formally reviewed and revised by the committee next Wednesday (April 2), and will finally decide whether to advance to the full vote of the House, and coordinate with the Senate version, and finally send it to the president for signature after being approved by both houses.