The Commodity Futures Trading Commission (CFTC) has updated its definition of payment stablecoins, now permitting national trust banks to issue these fiat-pegged tokens. The revised guidance, known as Staff Letter 26-05, clarifies that these banks, which offer custodial and asset management services but do not engage in traditional retail banking, can participate in the stablecoin market.
This change comes in the wake of the GENIUS Act, signed into law by former President Donald Trump in July 2025, which established a regulatory framework for US dollar-backed stablecoins. The act mandates that only overcollateralized stablecoins, backed by cash deposits or short-term government securities, are recognized.
In December 2025, the Federal Deposit Insurance Corporation (FDIC) proposed a separate framework allowing commercial banks to issue stablecoins through subsidiaries, ensuring compliance with the GENIUS Act. This initiative emphasizes the importance of maintaining adequate backing and financial health for both banks and their subsidiaries involved in the issuance of stablecoins.