NCUA Suggests GENIUS Act Rules for Credit Union Stablecoin Issuers

What the proposal does

Establishes a category called “permitted payment stablecoin issuer” (PPSI) for entities that want to issue payment stablecoins under the GENIUS Act and are affiliated with federally insured credit unions.
Implements the GENIUS Act mandate that NCUA license, regulate, and supervise PPSIs and issue implementing regulations by July 18, 2026.
Provides application procedures and timelines so credit unions are not disadvantaged relative to banks or other regulated entities.

Credit unions cannot issue stablecoins directly; issuance must occur through a subsidiary that is licensed as a PPSI.
The PPSI must be a credit union service organization (CUSO)–type subsidiary that is controlled by the federally insured credit union (including minimum ownership thresholds, such as over 10% ownership in some descriptions).
The PPSI must primarily serve credit union members, keeping the activity tied to the credit union’s member base rather than broad, unregulated retail outreach.

Applicants and their parent credit unions must show financial health, responsible management, and a viable business plan to be licensed as PPSIs.
The proposed framework includes governance standards, background checks for key executives, capital and reserve requirements, and expectations for cybersecurity and operational resilience.
Stablecoins issued by PPSIs must have 1:1 reserve backing and clear redemption rights, aligning them with “payment stablecoin” policy goals focused on safety and convertibility.

NCUA would decide on a completed PPSI application within about 120 days, giving applicants a predictable decision timeline.
Once approved, issuers must, within 180 days and annually thereafter, certify that they maintain effective anti‑money‑laundering and economic‑sanctions compliance programs.
Public comments on the proposal are open until April 13, 2026, after which NCUA will finalize rules to meet the July 18, 2026 statutory deadline under the GENIUS Act.

For credit unions, the proposal creates a structured opportunity to enter stablecoin-based payments while remaining inside the traditional prudential regulatory perimeter.
For policymakers, it is the first concrete NCUA step to implement the GENIUS Act, aimed at consumer protection, preserving the dollar’s role, and coordinating with Treasury and other regulators on stablecoin oversight.