Published on
June 11, 2026
New York DFS announces interim regulation on stablecoins aligned with the GENIUS Act
NY DFS proposes a stablecoin regulation to align with the GENIUS Act; current guidance stays until federal rules take effect.
The New York State Department of Financial Services (DFS) has announced a proposed regulation to align its stablecoin framework with federal rules under the GENIUS Act, ensuring consistency while maintaining high consumer protection standards. The proposed regulation, revealed on June 9, 2026, by Acting Superintendent Kaitlin Asro, is intended to harmonize New York’s existing framework with the federal regulatory structure as it continues to develop.
Aligning State and Federal Standards
The DFS’s existing stablecoin guidance, established in 2022 as the first of its kind in the nation, will remain in effect until the GENIUS Act regulations are finalized. According to Asro, while the federal regulatory framework already reflects the DFS’s framework, the proposed regulation will ensure "full alignment" with the GENIUS Act. She emphasized that this harmonization will not compromise New York’s "standard" for protecting consumers while fostering responsible innovation.
The federal framework, as outlined by the Department of Treasury on April 3, 2026, defines the principles for determining when state regulatory regimes are substantially similar to federal standards. The proposed DFS regulation builds on these principles to ensure compliance.
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Key Features of the Proposed Regulation
The proposed regulation would apply to U.S. dollar-backed stablecoins overseen by the DFS. It outlines several key requirements for entities seeking DFS approval, including limited purpose trust companies, applicants for such charters, and any other entities deemed eligible under the GENIUS Act’s safety and soundness criteria.
Key provisions of the regulation include:
- Requirements for stablecoin backing and redeemability.
- Guidelines for maintaining permissible reserves.
- Mandatory independent audits.
- Limitations on the maximum reserve held by any single custodian.
- The establishment of risk management programs in line with federal rules.
The DFS regulation also adheres to the federal prohibition on rehypothecation, as outlined in section 4(a)(2) of the GENIUS Act, with exceptions specified by the legislation.
Timeline and Next Steps
The proposed regulation is now open for public input. A 10-day pre-proposal comment period will run through June 22, 2026, followed by a 60-day formal comment period once the proposal is published in the State Register. The DFS has stated that it will "carefully review" all comments received during these periods.
DFS intends for its final regulation to take effect in coordination with the GENIUS Act’s implementation. This timing is expected to be either January 18, 2027, or 120 days after federal regulators issue final rules under the act, whichever comes first.
For now, the current DFS stablecoin guidance remains in place, ensuring continued oversight until both state and federal regulations are finalized.
Conclusion
The DFS’s proactive steps to align its standards with the GENIUS Act reflect its commitment to maintaining high consumer protection standards while fostering innovation in the financial technology sector. As the regulatory landscape for stablecoins continues to evolve, stakeholders will have multiple opportunities to provide input and shape the final framework. Acting Superintendent Kaitlin Asro’s announcement underscores the importance of collaboration between state and federal regulators to create a cohesive system that benefits consumers and the broader financial ecosystem alike.
