STABLE Act
What Is the STABLE Act?
Introduced to the U.S. Congress in March 2025, the Stablecoin Transparency and Accountability for a Better Ledger Economy (STABLE) Act is a proposal for a federal law to regulate stablecoins in the country. It specifically focuses on “payment stablecoins”, which refers to digital assets that an issuer is obligated to redeem for a fixed amount, such as the U.S. dollar.
The STABLE Act aims to provide distinct pathways for both bank and qualified non-bank entities to operate legally, while mitigating the volatility of unbacked stablecoin projects.
How Does the STABLE Act Work?
As proposed, the STABLE Act mandates several core requirements for any “permitted payment stablecoin issuer”:
- One-to-One Reserves: Issuers must maintain reserves backing their stablecoins on a 1:1 basis using highly liquid assets, such as U.S. currency or short-term Treasury bills.
- Dual Regulatory Pathways: The legislation offers two main routes for compliance:
- Federal Pathway: Banks and qualified non-bank issuers are overseen by the Office of the Comptroller of the Currency (OCC).
- State Pathway: Issuers can operate under state regulatory regimes, provided those states are certified to meet or exceed federal standards.
- Strict Disclosures and Audits: Issuers are required to publicly disclose their redemption policies and publish monthly reports on the composition of their reserves.
- Algorithmic Stablecoin Moratorium: The Act places a two-year moratorium on new “endogenously collateralized” stablecoins (algorithmic stablecoins) that rely on another digital asset from the same creator to maintain their peg.
STABLE Act vs. GENIUS Act: What’s the Difference?
While the STABLE Act and the GENIUS Act were both part of the 2025 push to regulate stablecoins, they diverge significantly in their current legal status and specific oversight mechanics:
- Legislative Status: The GENIUS Act was signed into law in July 2025, whereas the STABLE Act is a proposal that has been introduced to Congress but has not yet been passed or signed into law.
- State Oversight & Caps: The GENIUS Act introduced a $10 billion market cap threshold, and once a state-qualified issuer exceeds this cap, it must transition to federal oversight. In contrast, the STABLE Act does not impose a size threshold for state-regulated issuers, allowing them to remain under state supervision indefinitely as long as the state’s regime “meets or exceeds” federal standards.
- Insolvency Protections: The GENIUS Act explicitly grants stablecoin holders “super-priority” claims in the event of an issuer’s bankruptcy. The STABLE Act, in its current introduced form, requires 1:1 reserves but does not include these bankruptcy-specific priority provisions.
- Issuer Eligibility: The STABLE Act is generally seen as more inclusive of non-financial firms. While the GENIUS Act prohibits most publicly traded non-financial companies from issuing stablecoins without a special waiver, the STABLE Act contains no such restriction.
Ultimately, while the GENIUS Act provides the existing legal floor for the industry, the STABLE Act represents a potential expansion or alternative framework for stablecoin regulation.
