The Federal Reserve has proposed requiring issuers of payment stablecoins to collect names, addresses, dates of birth, and government IDs before opening accounts. The rule, published for public comment, applies to entities the central bank calls "payment stablecoin issuers" (PPSIs) and mirrors customer identification programs (CIP) that banks and broker-dealers have used for more than two decades.
What the proposal demands
Under the plan, a PPSI must maintain a written CIP that collects a customer's legal name, date of birth (or formation date for businesses), physical address, and a government-issued identification number. The rule would cover both individuals and entities seeking to open an account with the issuer.
Importantly, the proposal defines an "account" to include a redemption event. That means a secondary-market holder who redeems tokens directly with the issuer triggers the CIP obligations. Purely peer-to-peer transactions that happen via smart contracts on a blockchain, without involving the issuer, would not fall under the requirement.
Why now, and what comes next
The proposal arrives after the Genius Act (Guiding and Establishing National Innovation for U.S. Stablecoins Act) was signed by President Trump in July 2025. That law created the first federal regulatory system for stablecoins, mandating 100 percent reserve backing and subjecting issuers to the Bank Secrecy Act. The Genius Act becomes effective on the earlier of January 18, 2027, or 120 days after primary federal regulators issue final implementing rules.
Federal Reserve Governor Michael Barr has warned that the Genius Act alone does not resolve risks tied to reserve asset quality, regulatory arbitrage, anti-money-laundering gaps, or financial stability. The new CIP proposal is one piece of a broader effort to fill those gaps.
Public comments on the Fed's proposal will be accepted for 60 days. Final CIP rules are not expected before 2027, meaning the Genius Act could take effect before the customer identification architecture is fully in place.
Parallel rulemaking across agencies
The Fed's move follows a joint proposal in April 2026 from FinCEN and OFAC that would require PPSIs to adopt anti-money-laundering and counter-financing-of-terrorism programs, as well as sanctions compliance. That rule would carve PPSIs out of the money services business category and treat them as a distinct type of Bank Secrecy Act-covered financial institution.
FinCEN has noted that roughly half of known stablecoin issuers have not registered as money services businesses.
The FDIC and the OCC have also issued parallel proposed rules covering licensing, reserves, capital requirements, and redemption standards for stablecoin issuers.
The timing question
The Fed's proposal is open for comment, but the timeline for finalizing it remains unclear. With the Genius Act potentially becoming effective in early 2027, regulators are racing to put the underlying rules in place. Whether the customer identification framework will be ready before the law kicks in is an open question.
