Fed Gives Stablecoin Issuers 24 Hours to Report a Reserve Shortfall Under Draft GENIUS Act Rules

On 24 September, the Federal Reserve Board of Governors opened comment on two draft rules for the payment stablecoin issuers it supervises under the Guiding and Establishing National Innovation for US Stablecoins Act (GENIUS Act), which became law in July 2025. The first draft requires tokens to be matched at all times by allowed reserve assets, limited to highly liquid instruments such as short-dated Treasury bills.

The enforcement mechanism is a clock. An issuer whose reserves fall below the value of its outstanding tokens gets 24 hours to notify the Fed and submit a plan to restore full backing. If the plan does not satisfy supervisors, the issuer must begin selling reserve assets and processing redemptions. CryptoSlate's reading is that the two steps together create roughly a 48-hour window in which a supervised issuer publicly liquidates into a market that already knows it is short. The proposals carry a 60-day comment period and are not final.

The scope matters as much as the clock. Circle's USDC, with $75.39 billion outstanding, sits inside the American supervisory perimeter. Tether's USDT, at $183.75 billion of the $313.03 billion stablecoin float, is issued offshore, and Washington's practical interest in it runs the other way. Tether's Treasury holdings of roughly $114 billion make it a buyer of American government debt and a distributor of dollar exposure abroad. The same government that fined Tether for misrepresenting its reserves now has a fiscal reason to want those tokens circulating. A rulebook that binds the supervised issuer tightly while the largest issuer stays outside it changes the competitive picture before it changes run risk.