FDIC Proposal Clarifies Stablecoins Lack Deposit Insurance While Tokenized Bank Deposits Retain Coverage

On March 11, 2026, FDIC Chairman Travis Hill proposed a rule that would exclude all payment stablecoins from federal deposit insurance, even when reserves are held at insured banks. Tokenized deposits issued by FDIC-insured institutions would remain covered up to $250,000, while the move aligns with the GENIUS Act of July 2025, which bans government safety nets and interest payments for stablecoin holders. The proposal is expected to face industry feedback during a public comment period and could push risk-averse users toward regulated tokenized deposit products.