FDIC Rules Out Pass-Through Insurance for Stablecoin Holders
AP
Amara Pendleton
crypto IRS ruling · Apr 14, 2026
Source: DojiDoji Data Terminal
Stablecoin holders will not receive FDIC deposit insurance, even if the reserves backing their tokens are held at insured banks. The FDIC Board of Directors approved a notice of proposed rulemaking on April 7, 2026, to implement the GENIUS Act, which creates a federal framework for stablecoins.
The proposal explicitly states that reserves backing payment stablecoins would not be insured to stablecoin holders on a pass-through basis. This mechanism, common in traditional finance, would have extended coverage to the end user through an intermediary. The FDIC views the token issuance layer as a disqualifying extra step.
To compensate for the lack of insurance, the rule requires stablecoin reserves to be treated as customer property and segregated from the bank's own assets. Custodial banks must publish monthly audit-verified reports of these reserves to ensure they are not lumped in with the bank's balance sheet. If a stablecoin issuer fails, holders will have a priority claim on a pool of fully reserved, audited, and segregated assets.
Banks can begin submitting applications to issue stablecoins as early as July 2026. Final implementing regulations are expected in late 2026.