CFTC Changes Rules to Allow National Trust Banks to Issue Stablecoins

In a significant development for the digital assets and financial regulation landscape, the U.S. Commodity Futures Trading Commission (CFTC) has revised its regulatory guidance to explicitly allow national trust banks to issue stablecoins — a class of digital currencies pegged to fiat assets. This move, formalized through an updated Staff Letter (25-40), effectively broadens the categories of institutions that can be recognized under the CFTC’s no-action framework governing payment stablecoins and their use as collateral in derivatives trading.

Previously, national trust banks were inadvertently excluded from the list of eligible stablecoin issuers despite being federally chartered entities capable of holding customer funds and providing fiduciary services. The amended guidance aligns with provisions in the GENIUS Act — comprehensive federal legislation passed in 2025 to standardize stablecoin regulation — ensuring that the CFTC’s interpretation dovetails with broader U.S. legal frameworks.

By clearing this regulatory ambiguity, the CFTC has opened the door for more regulated banks to participate directly in the stablecoin ecosystem. This shift could pave the way for increased adoption of bank-issued digital dollars, strengthen market confidence, and foster further institutional involvement in tokenized finance.

Key Highlights

• Regulatory Update: CFTC reissues Staff Letter 25-40 with expanded language officially including national trust banks as eligible stablecoin issuers.
• Alignment with Federal Law: The guidance supports the GENIUS Act’s framework for regulated, reserve-backed stablecoins.
• Collateral Eligibility: Stablecoins issued by national trust banks can now be accepted as margin collateral in derivatives and futures markets under the CFTC’s no-action stance.
• Market Impact: Clarification removes uncertainty and expands the potential issuer base for compliant stablecoins.
• Institutional Confidence: The rule change may attract greater institutional participation and support stablecoin adoption in regulated markets.

What the Change Means for Stablecoin Issuance

Background: Stablecoins in U.S. Regulation

Stablecoins — digital tokens designed to maintain a stable value relative to fiat currencies such as the U.S. dollar — have become integral to blockchain ecosystems, decentralized finance (DeFi), and digital payments. Yet regulatory uncertainty has long been a barrier to broader institutional participation, particularly among traditional banks and federally chartered entities.

In response, the GENIUS Act, enacted in 2025, established a federal framework requiring that stablecoins be fully backed by U.S. dollars or “high-quality liquid assets” and issued by regulated entities. However, the initial language in the CFTC’s no-action letter did not explicitly encompass national trust banks — leading to questions about their eligibility as issuers under CFTC policy.

The revised staff letter corrects this oversight by clarifying that national trust banks are included within the definition of institutions that can issue payment stablecoins acceptable as collateral in CFTC-regulated markets. This removes a key regulatory hurdle, enabling national trust banks to participate more confidently in the stablecoin space.

Implications for Markets and Banking

Broader Issuer Base and Competition

With national trust banks now eligible as stablecoin issuers, the pool of potential institutional participants expands beyond traditional crypto firms and fintech entities. National trust banks — which are fully regulated, insured, and subject to stringent fiduciary responsibilities — bring credibility that could further integrate tokenized assets with mainstream finance.

In practical terms, this could mean:

• More bank-issued stablecoins in circulation
• Expanded use of stablecoins for institutional settlement, trading, and custody
• Increased competition that may lead to innovations in compliance, reserve management, and interoperability

Use as Collateral in Derivatives Markets

Under the updated CFTC guidance, stablecoins issued by national trust banks can be accepted as margin collateral by futures commission merchants (FCMs) and other intermediaries in derivatives markets regulated by the CFTC. This is an important development for institutional traders and funds that use digital assets in risk management and hedging strategies.

The expansion of eligible collateral helps bridge traditional finance with digital markets, enhancing liquidity and providing more flexible ways for market participants to manage exposure across asset classes. As stablecoins mature, their role in cross-border payments, tokenized securities, and decentralized applications can only grow — provided clear regulatory guardrails remain in place.

Regulatory Coordination and Future Outlook

Consistency Across Agencies

This CFTC clarification is part of a broader trend toward regulatory coordination among U.S. agencies on digital asset policy. By aligning its approach with the GENIUS Act and other federal standards, the CFTC is helping reduce the patchwork of uncertainty that has historically hindered stablecoin adoption.

At the same time, other regulators — such as the Federal Reserve and Office of the Comptroller of the Currency (OCC) — continue to evaluate their roles in supervising stablecoin activities, particularly around reserve requirements, custody, and systemic risk. Clearer guidance from the CFTC contributes to a more predictable environment for both regulators and market participants.

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