The passage of the GENIUS Act, (Guiding and Establishing National Innovation for US Stablecoins, a law regulating stablecoins) in July 2025 marks a pivotal moment for stablecoins in the United States, opening the market to a diverse array of institutions, including banks, technology firms, crypto-native entities, and new market entrants. The establishment of a federal framework for stablecoins also brings significant compliance and risk management implications. These present both challenges and opportunities for institutions planning to engage in stablecoin issuance and related services.
To meet GENIUS Act requirements, institutions need a roadmap so that they can adapt their existing risk and compliance frameworks. Requirements include full reserve backing, monthly disclosures, federal licensing, and robust anti-money laundering compliance. This process begins with the alignment of stablecoin strategies with organizational goals. Next, market players can assess the regulatory landscape and market dynamics and define their risk appetite through scenario-based risk assessments. With those steps completed, they can critically evaluate and enhance their compliance infrastructures.
Our new report, “Compliance in the Era of Stablecoins: Implications of the GENIUS Act” begins by placing stablecoins in the evolving payment landscape and exploring market entry options. It then examines the novel and complex risks introduced by stablecoins and how these translate into specific requirements for market participants. The work needed to adapt and update an organization’s risk and compliance framework will depend significantly on its starting position: there will likely be important differences between financial institutions that already are subject to regulation, and new market entrants. Lastly, we suggest a series of steps for adapting existing frameworks to the challenges and requirements posed by stablecoins and the GENIUS Act.
First steps toward a stablecoin risk and compliance framework
We recommend that institutions adapt their risk and compliance frameworks for stablecoins through a systematic approach that emphasizes strategic alignment, comprehensive assessment, and proactive enhancements. It should consist of the following steps.
Assess potential stablecoin offering
A stablecoin strategy should align with an organization’s overall objectives. The institution should start by identifying existing products or services that could integrate seamlessly with stablecoins, such as payment processing and digital banking tools. A gap analysis can then help reveal areas where stablecoins could enhance current offerings and can start highlighting potential risks or concerns.
Understand market and regulatory dynamics
A thorough understanding of market demand and the regulatory landscape is crucial. Organizations should tailor their strategies to the geographic regions they serve, considering the variety of international regulations they may be subject to. Targeting early adopters as customers can provide valuable insights and a quick implementation of stablecoin solutions, maximizing impact.
Define stablecoin risk appetite and assess potential scenarios
Institutions should define their organizational risk tolerance in order to make informed decisions about technological investments and customer engagement strategies. Scenario-based risk assessments can help anticipate the potential challenges of stablecoin adoption, including market volatility and regulatory hurdles. Resilience strategies, such as contingency plans and exit options, can prepare organizations to address unexpected challenges effectively.
Evaluate and enhance risk and compliance frameworks
A critical evaluation of existing compliance frameworks will help determine whether an institution can accommodate the unique challenges of stablecoins. These include regulatory alignment with existing laws, such as Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) requirements, and the identification of gaps that need addressing. It will be vital to invest in advanced compliance tools, such as transaction monitoring systems and KYC platforms.
These steps can help institutions create a comprehensive strategy that integrates stablecoin offerings into their existing frameworks and effectively manages associated risks. Organizations will then be able to comply with regulations and maintain operational integrity — and thus be able to capitalize on emerging opportunities in digital finance.
