Key TakeawaysFederal agencies including the Fed, Treasury, OCC, and FDIC unveiled proposed regulations mandating identity verification for stablecoin providersThese requirements originate from the GENIUS Act legislation enacted in July 2025Providers must authenticate customer identities, including name verification, address confirmation, and terrorism watchlist screening per Bank Secrecy Act protocolsPublic feedback window opens for 60 days following Federal Register publicationFederal Reserve Governor Michael Barr expressed reservations about inadequate coverage of secondary market activitiesA coalition of federal financial oversight bodies has unveiled regulatory proposals mandating that stablecoin providers implement customer identification protocols equivalent to those enforced in the banking sector.JUST IN: The Federal Reserve proposes a stablecoin issuer identification program This is the first GENIUS Act rulemaking from the Fed. pic.twitter.com/Obej8CfbZy— Bitcoin Magazine (@BitcoinMagazine) June 18, 2026The regulatory framework was announced Thursday through a coordinated effort among the Federal Reserve, Department of the Treasury, Federal Deposit Insurance Corporation, Office of the Comptroller of the Currency, and the National Credit Union Administration.This initiative represents a key implementation phase of the Guiding and Establishing National Innovation for U.S. Stablecoins Act—commonly referred to as the GENIUS Act—which became federal law in July 2025.Core Requirements of the Proposed FrameworkThe regulatory blueprint would designate stablecoin providers as regulated financial entities subject to Bank Secrecy Act compliance obligations.This classification would compel these companies to authenticate the identity of all account holders, maintain comprehensive records of identification data, and screen customers against federal terrorism watch databases.These obligations mirror existing anti-money laundering and counter-terrorism financing mandates currently imposed on banking institutions and securities firms.Following its official publication in the Federal Register scheduled for Monday, the proposed regulation will enter a 60-day public consultation phase.This marks the second opportunity for stakeholder input. During an initial consultation period last September, the Treasury Department collected 450 individual submissions.Market LandscapeCurrent U.S.-based stablecoin operators include Tether, the entity behind the USDT token, alongside Circle, which manages USDC.Several established financial institutions have recently launched their own stablecoin offerings in this expanding market segment.The GENIUS Act’s complete implementation is scheduled for 18 months following its enactment, or alternatively 120 days after regulators complete their rulemaking process.The Financial Crimes Enforcement Network (FinCEN), the Treasury’s anti-financial crime division, has independently advanced its own regulatory proposals focused on combating illicit financing under the same legislative authority.Additionally, the FDIC put forward a proposal in April clarifying that federal deposit insurance coverage for stablecoin issuers would not extend protection to individual token holders.Regulatory Concerns PersistNot all board members view the current proposal as sufficiently comprehensive.Federal Reserve Governor Michael Barr articulated ongoing concerns that the GENIUS Act regulatory structure inadequately addresses illicit finance risks within secondary market transactions.Barr emphasized that “bad actors” can too easily “evade these restrictions” during digital asset trading activities.The comprehensive 130-page proposal explicitly solicits feedback on whether identity verification mandates should encompass secondary market operations, directly inviting stakeholder perspectives on this issue.In parallel legislative activity, Congress has yet to establish a definitive schedule for advancing the Digital Asset Market Clarity Act, companion legislation designed to reshape how regulatory agencies oversee cryptocurrency markets more comprehensively.Capitol Hill observers anticipate possible passage before the August congressional recess, though Democratic lawmakers’ concerns regarding potential conflicts of interest may delay advancement.The post Federal Agencies Unveil Banking-Level Identity Verification Requirements for Stablecoin Providers appeared first on Blockonomi.