FDIC Chairman Travis Hill announced the agency will propose expressly excluding payment stablecoins from pass-through insurance coverage. Hill argued that extending pass-through coverage would be inconsistent with the GENIUS Act’s directive that tokens not be “subject to deposit insurance” or marketed as federally guaranteed.
What you should do: This is good news for community banks. If stablecoins cannot carry FDIC pass-through insurance, they are less attractive as deposit substitutes. Core deposits retain the advantage of federal insurance.
Source: https://www.fdic.gov/news/speeches/2026/statement-chairman-travis-hill-proposal-implement-genius-act