The GENIUS Act and stablecoins: what changed for businesses

The GENIUS Act is the federal law that decides who may issue payment stablecoins in the United States and how those stablecoins must be backed. It was signed on July 18, 2025 as Public Law 119-27, and it takes effect on January 18, 2027. Until then it is law on the books, not yet in force.

The Act regulates issuers first, then the platforms that offer stablecoins to people in the U.S., with the main platform restriction starting July 18, 2028. It does not expressly regulate a business that simply accepts stablecoins for its own goods or services. What it changes for that business is quieter: which coins will be legal to issue, what issuers must publish, how redemption works, and which coins U.S. platforms may keep offering.

Below: the timeline, the issuer rules, where rulemaking stands in November 2026, what did not change, a checklist and how Flux fits.

What the GENIUS Act covers

The full name is the Guiding and Establishing National Innovation for U.S. Stablecoins Act (S. 1582). Under Sec. 2(22), a payment stablecoin is a digital asset used, or designed to be used, for payment or settlement, whose issuer must convert, redeem or repurchase it for a fixed amount of money. National currency, bank deposits (including tokenized deposits) and securities are excluded.

Sec. 3(a) makes it unlawful for anyone other than a "permitted payment stablecoin issuer" to issue a payment stablecoin in the U.S. Under Sec. 2(23), there are three kinds, all formed in the U.S.:

• A subsidiary of an insured depository institution (a bank or credit union), approved under Sec. 5.
• A federal qualified issuer, approved by the Office of the Comptroller of the Currency (OCC).
• A state qualified issuer. One with $10 billion or less outstanding may opt for a state regime that is "substantially similar" to the federal one (Sec. 4(c)); above that line it must move under joint state and federal oversight within 360 days or stop issuing new coins, unless a federal regulator grants a waiver (Sec. 4(d)).

A public company not mainly in financial services also needs a unanimous vote of a Treasury-chaired review committee before issuing (Sec. 4(a)(12)). The full text is on govinfo.gov.

The GENIUS Act timeline: 2025 to 2028

The effective date comes from a formula in Sec. 20: the earlier of 18 months after enactment (January 18, 2027) or 120 days after the federal banking regulators issue final rules. The first of those, the OCC's, came on October 21, 2026. Counting 120 days from then lands on February 18, 2027, so the 18-month date controls.

Two dates are easy to misread. The statute gave regulators one year to write rules, not six months. And the three-year date is not a general grace period for issuers: it is when the main restriction on service providers starts. A narrower limit, on platforms offering coins from foreign issuers that cannot comply with lawful orders, applies from the January 18, 2027 effective date (Sec. 3(b)(2)).

What the law requires of stablecoin issuers

Most of the Act is a rulebook for issuers. Read from the holder's side, each rule tells you something about the coin in your wallet.

Reserves and monthly reports

Reserves must be at least one to one, limited to U.S. currency and Federal Reserve balances, deposits at insured banks and credit unions, Treasury bills, notes and bonds with 93 days or less to maturity, certain overnight repurchase agreements, government money market funds, other similarly liquid federal government assets a regulator approves, and tokenized forms of most of these (Sec. 4(a)(1)(A)). They "may not be pledged, rehypothecated, or reused," with narrow exceptions (Sec. 4(a)(2)).

Each month the issuer must publish its reserve composition on its website, and a registered public accounting firm examines the report, which the CEO and CFO certify (Sec. 4(a)(3)). Issuers with more than $50 billion outstanding that do not already file reports with the SEC must also publish audited annual financial statements (Sec. 4(a)(10)).

Redemption and fees

Issuers must have "clear and conspicuous procedures for timely redemption," disclose purchase and redemption fees in plain language, and give at least 7 days' notice before changing them (Sec. 4(a)(1)(B)). The OCC's final rule sets two business days as the outer limit for timely redemption.

No interest or yield from the issuer

Sec. 4(a)(11) bars issuers from paying holders "any form of interest or yield" solely for holding, using or retaining the coin. Whether rewards paid by third parties are caught is still argued over, and the OCC dropped a proposed presumption against those arrangements in favor of case-by-case review.

Not insured, not a security

Payment stablecoins are not covered by FDIC deposit insurance, and issuers may not claim they are backed by the full faith and credit of the United States (Sec. 4(e)). The FDIC's April 2026 proposal adds that reserve deposits held at a bank would not be insured to stablecoin holders on a pass-through basis. Sec. 17 removes payment stablecoins from the definitions of "security" and "commodity," but only when a permitted issuer issued them. If an issuer fails, holders' claims on the required reserves come ahead of other creditors (Sec. 11).

Freezes and anti-money laundering duties

An issuer must be able to comply with any lawful order, defined as one requiring it to "seize, freeze, burn, or prevent the transfer" of stablecoins (Secs. 2(16) and 4(a)(6)). Issuers are also financial institutions under the Bank Secrecy Act, with anti-money laundering, sanctions and customer identification duties (Sec. 4(a)(5)).

Where the GENIUS Act rules stand in November 2026

As of November 4, 2026, the OCC's is the only final rule setting standards for issuers, Treasury has interim procedures for reviewing state certifications, and the rest are proposals.

For a business on the receiving end, Treasury's August 18, 2026 proposal matters most: it covers the July 18, 2028 restriction on platforms and the Sec. 3(c) safe harbors. Check the Federal Register for anything newer than November 4, 2026. The OCC rule leaves anti-money laundering and sanctions to a separate rulemaking with Treasury (the OCC proposed one on June 24, 2026), and the OCC will announce separately when it starts accepting applications (see the OCC's release).

Existing issuers are not grandfathered. Under the OCC rule, a waiver of up to one year is available only to issuers whose OCC applications are pending on January 18, 2027, and law firm summaries report that the OCC generally expects to grant waivers to issuers already operating in the U.S.

What changes for a business that accepts stablecoins

If some of your customers pay in stablecoins, the changes reach you through the coins you accept and the platforms you use.

The Act licenses issuers, not merchants

Its restrictions fall on issuers and on digital asset service providers, defined in Sec. 2(7) as businesses that, for compensation or profit, exchange digital assets for money or other digital assets, transfer digital assets to a third party, act as a digital asset custodian, or take part in financial services tied to issuance. It does not expressly address a merchant accepting stablecoins for its own sales. The OCC's final rule does not define who counts as a service provider. If you hold coins for customers, convert them for others or move them to third parties for a fee, the analysis can change under federal and state law, so ask counsel.

Know who issued the coin you accept

From January 18, 2027, issuing a payment stablecoin in the U.S. without being a permitted issuer is unlawful. The Act also bars marketing a product in the U.S. as a payment stablecoin unless it was issued under the Act, with Treasury fines of up to $500,000 per knowing and willful violation (Sec. 4(e)(3)). For each coin you accept, find out who issues it, its approval status, and where its reserve report and redemption policy are published.

A coin in your wallet can be frozen

Because issuers must be able to freeze or block transfers under lawful orders, tokens you receive are not beyond reach. The FinCEN and OFAC proposal would require issuers to be able to "block, freeze, and reject specific or impermissible transactions," and one of its examples of secondary market activity is a person paying a vendor from a self-hosted wallet. FinCEN is not proposing that issuers monitor that activity, but the freeze capability still applies.

Redemption runs through the issuer

The right to redeem at par is a right against the issuer. Under the OCC rule, a holder who bought from a third-party distributor "is not the issuer's customer unless and until the holder seeks to redeem from the issuer." If you want dollars straight from the issuer, expect its customer onboarding, and read its published redemption fees first.

July 18, 2028: what platforms can offer

From that date, a digital asset service provider may not offer or sell a payment stablecoin to a person in the U.S. unless a permitted issuer issued it, subject to Treasury safe harbors and a process for comparable foreign issuers (Secs. 3(c) and 18). Treasury's August 2026 proposal would implement these limits and safe harbors; it is not final. Direct transfers between two individuals acting for themselves without an intermediary, and transactions through a wallet that facilitates an individual's own custody, are outside Sec. 3 (Sec. 3(h)). If an issuer is never approved, the platforms you rely on may stop offering its coin.

Refunds are still your policy

The Act creates redemption rights against issuers, not a payment dispute process. A stablecoin payment has no card-network chargeback, so a refund happens only when you send one, under your own policy and any consumer protection rules that apply to your sales.

A plainly hypothetical example: say a design studio is paid 4,000 USDC on Solana for a project, and the client cancels half the work a week later. Its written policy decides whether it returns 2,000 USDC or a dollar amount, to which wallet and network, and how fast. Without one, every refund becomes a negotiation, so write it before your first stablecoin payment and show it where customers pay.

Stablecoins behind the card

Visa is using stablecoins for settlement between institutions, behind the card. On December 16, 2025, Visa said U.S. issuer and acquirer partners could settle with it in Circle's USDC, starting over Solana, "without any change to the consumer card experience." For a merchant, a card sale is still a card sale, with the same card rules and disputes.

What did not change: taxes, books and state law

Tax treatment

The Act has no tax provisions. The IRS says "for U.S. tax purposes, digital assets are considered property, not currency," and lists stablecoins as a digital asset. A business that receives digital assets for goods or services has income measured at fair market value in U.S. dollars when received. Later converting or spending them is its own transaction, which is a question for your CPA.

Brokers report on Form 1099-DA for transactions from January 1, 2025. Under an optional method in the 2026 instructions, brokers can skip reporting a customer's designated sales of "qualifying stablecoins" up to $10,000 in gross proceeds a year. That limits broker reporting only; it is not a tax exemption.

State licensing

State law runs alongside the Act. California's Department of Financial Protection and Innovation says that beginning July 1, 2026, companies must be licensed or have applied for a license to operate in the state under its digital financial assets law. Its page does not address merchants accepting digital assets as payment. Our guide to California's Digital Financial Assets Law and stablecoin acceptance covers who that law targets. If you operate in other states, check their rules with counsel too.

A checklist before January 18, 2027

These steps are housekeeping, not a list of legal requirements.

1. List what you accept. Write down each stablecoin and network you take today, and who issues each coin.
2. Find each issuer's disclosures. Bookmark where it publishes its monthly reserve report, redemption policy and fees.
3. Track approval status. Watch for the OCC's announcement on applications, and note whether each issuer has applied, been approved or is relying on a waiver.
4. Write a stablecoin refund policy. Cover the refund currency, receiving address, network and timeline.
5. Record the dollar value at receipt. Agree with your CPA how each payment is booked and how later conversions are tracked.
6. Check what you do beyond accepting. If you hold coins for customers, convert for others or pay people out, ask counsel about federal and state licensing.
7. Mark July 18, 2028. Confirm the platforms you use will still be able to offer the coins you accept.

This guide is general information as of November 2026, not legal or tax advice. Rules are still being finalized, so confirm your own position with your attorney and CPA.

How Flux fits

The GENIUS Act sets the rules for who issues stablecoins. Flux works on the acceptance side. With Flux stablecoin payments, you can accept stablecoins on the Solana and Ripple (XRP Ledger) networks, including USDC and other leading stablecoins, and payments go directly to your wallet instantly. They run through the same integration as cards and ACH and appear in your dashboard alongside that activity (see accepting cards, ACH, and stablecoins from one integration).

Stablecoin payments are 0.5% (50 basis points) per transaction on every Flux plan, for businesses with at least $50,000 a month in stablecoin volume, with no contracts (see. Highly regulated industries may have a volume-based setup fee, which can be waived on volumepricing). An underwriter reviews every application, and the team can talk through which stablecoins and networks fit your business.

Software companies work with Flux through its referral and partner program: each referred business applies, a person reviews it, and it gets its own Flux account, while the software can build on the Flux API, hosted fields and payment links. The partner portal tracks each referral from application to live processing. To become a partner, email support@fluxpayments.com.