The U.S. Treasury Department’s latest stablecoin rulemaking is approaching a critical deadline, with public comments due October 19 before the GENIUS Act’s expected effective date on January 18, 2027.
Treasury published its 24-page Notice of Proposed Rulemaking in the Federal Register on August 18 under docket TREAS-DO-2026-0496. The proposal implements Section 3 of the GENIUS Act, which establishes restrictions governing who can issue payment stablecoins in the United States and how domestic platforms can handle foreign-issued tokens.
Comments must be received by October 19. The timing matters because January 18 represents the expected date on which one of the GENIUS Act’s most important prohibitions begins applying: a person generally cannot issue a payment stablecoin in the United States unless operating as an appropriately licensed permitted payment stablecoin issuer.
Treasury Defines What Counts as U.S. Issuance
A central question is what legally constitutes “issuing” a stablecoin. Treasury proposes defining issuance around the first transfer of a payment stablecoin by its issuer that results, or will result, in another person obtaining the right to use, transfer or redeem it.
That means simply minting tokens may not necessarily constitute issuance if the issuer continues holding them itself.
But Treasury proposes treating a subsequent transfer of previously redeemed or reacquired tokens as a new issuance, even if the issuer never technically burned and reminted those tokens.
The proposal also attempts to determine when an issuance occurs “in the United States,” an important distinction for foreign stablecoin businesses interacting with American customers or intermediaries.
Treasury is seeking feedback through dozens of specific questions, including whether minting directly into a holder’s account constitutes issuance, how indirect transfers through smart contracts should be treated and when redeemed tokens become newly issued again.
Foreign issuers face additional requirements. Digital-asset service providers generally cannot make foreign-issued payment stablecoins available unless the issuer possesses the technological capability to comply with lawful U.S. orders and applicable reciprocal arrangements.
Treasury proposes requiring platforms to conduct reasonable due diligence rather than simply accepting an issuer’s assertion that it can freeze, seize or otherwise control tokens when legally required.
January 2027 Is Only the First Deadline
The GENIUS Act’s restrictions arrive in stages. January 18, 2027 is the expected statutory effective date because it falls 18 months after the law was enacted on July 18, 2025.
The Act could technically become effective earlier if the primary federal payment-stablecoin regulators finalize implementing regulations sufficiently soon, because the statute uses the earlier of 18 months after enactment or 120 days after final regulations are issued.
Current expectations, however, point to January 18. From that date, unlicensed issuance of payment stablecoins in the United States generally becomes prohibited. That should not be confused with a blanket prohibition on U.S. exchanges offering every stablecoin whose issuer lacks a GENIUS license.
A second major deadline arrives July 18, 2028. Beginning then, digital-asset service providers generally cannot offer or sell payment stablecoins to people in the United States unless those tokens were issued by permitted issuers or otherwise satisfy the law’s foreign-issuer framework.
That distinction gives existing stablecoins and trading platforms additional time to adapt while imposing the licensing requirement on domestic issuance much sooner. The October 19 comment deadline therefore represents more than another procedural milestone.
Treasury is currently deciding how statutory phrases including “issue,” “offer or sell” and “in the United States” should operate across blockchain networks that function globally and continuously.
Those definitions could determine whether a transaction falls inside U.S. jurisdiction, what foreign stablecoin issuers must do to retain American market access and how much due diligence exchanges and custodians must conduct before listing their tokens.
With the first prohibition expected to take effect in less than five months, the industry’s opportunity to influence those definitions is now narrowing.
