“What To Watch As Florida Stablecoin Framework Takes Shape” – Law360

Originally published in Law360, Becker shareholder Robert C. Brighton Jr. provides a comprehensive review of Florida’s Payment Stablecoin Act and the broader federal regulatory developments that will shape compliance obligations, licensing requirements, and market participation for stablecoin issuers and service providers.

Florida’s Payment Stablecoin Act establishes a licensing and regulatory framework for payment stablecoin issuers administered by the state Office of Financial Regulation but does not comprehensively regulate digital asset service providers. Depending on their activities, digital asset service providers may be subject to Florida money services, anti-money laundering, kiosk, banking or trust, consumer protection, privacy, and other laws.

Because some federal standards, certification and Florida implementation remain pending, businesses should build core controls now while keeping launch plans and contracts flexible.

State approaches vary. Georgia and Alabama regulate issuers; Maryland also regulates stablecoin service institutions; Delaware integrates issuer, digital asset, banking and virtual currency rules; and New York, Texas and Wyoming use existing charter, licensing, guidance or state token models.

The proposed Clarity Act is stalled following the U.S. Senate’s Sept. 15 procedural vote. Near-term Florida implementation is therefore more likely to be driven by final Genius Act rules and certification standards than by the Clarity Act, although a later legislative compromise could require further changes, particularly to yield and intermediary rules. The Florida Act became law on June 26; its principal licensing and prudential provisions became effective Oct. 1. It places Florida-qualified issuers under the Florida OFR, although material federal and state implementation steps remain.

Counsel should analyze your clients’ activities, identify applicable federal and state regimes, and account for licensing, certification and rulemaking uncertainty in transaction timing and risk allocation. Advice should address the regulatory pathway, reserves, redemption, custody and compliance controls and be revisited as standards develop.

Effective Oct. 1, a person generally may not act as a Florida qualified payment stablecoin issuer without an OFR license or applicable exemption. An out-of-state, state-qualified issuer is exempt from Florida licensure but must notify the OFR as required, and a Florida trust company generally must obtain a certificate of approval or qualify for an exemption.

Companies that transmit, exchange, custody or distribute stablecoins also should assess money transmission and other applicable requirements; an intermediary may be regulated even if it is not the issuer.

Stablecoin activity therefore raises governance, capitalization, vendor management and contracting issues beyond product compliance. Counsel should confirm authority and approvals, allocate regulatory and operational risk, test representations on regulatory status and reserves, and include appropriate change-in-law, suspension and termination rights.

The act primarily affects prospective issuers, including banks, credit unions, trust companies and financial technology companies. It may also affect processors, transmitters, exchanges custodians, wallet providers, broker-dealers, marketplaces, merchants, treasury providers and stablecoin users.

Reserve custodians, auditors, compliance vendors and technology providers may face contractual, diligence and operational consequences even if not directly licensed.

Federal and State Overlay
The Genius Act sets minimum issuer standards for reserves, redemption, disclosure, custody, capital, risk management and Bank Secrecy Act compliance. Issuing subsidiaries of insured depository institutions and credit unions are federally supervised.

A nonbank issuer may use a certified state regime while its consolidated outstanding issuance remains below $10 billion; at or above that threshold, it generally must transition to federal supervision unless it receives a waiver. Florida’s regime also must be certified as substantially similar. The OCC finalized its implementing rule on Oct. 21, effective Jan. 18, 2027; other federal rules remain proposed.

Florida has amended its money services and AML laws, created OFR licensing and notice requirements, and established separate approval for trust companies. Other money transmitter, trust company, consumer protection, cybersecurity, privacy, unclaimed property and commercial laws may still apply.

National operators also must assess other states’ regimes. Federal preemption will depend on the activity, final rules, certification and any later market structure legislation.

Core Florida Act Obligations
Florida’s framework is designed to align with the Genius Act. Covered issuers face requirements governing one-to-one reserves, eligible reserve assets, redemption, monthly disclosures, custody, AML and sanctions compliance, limits on reserve-asset reuse and interest or yield, and permitted activities.

A state-qualified issuer with at least $10 billion in consolidated outstanding issuance generally must transition to federal supervision unless it receives a waiver.

Treatment of Interest, Yield and Rewards
The Genius Act and Florida law prohibit an issuer from paying interest or yield solely in connection with holding, using or retaining a payment stablecoin. They do not expressly impose that prohibition directly on rewards independently funded and controlled by an unaffiliated intermediary, although each program requires a fact-specific analysis.

The Office of the Comptroller of the Currency’s February proposal would have treated interest, yield or rewards paid by an affiliate or related third party under an arrangement with the issuer — including certain funded or white-label programs — as issuer-paid. However, the final rule, released Oct. 21, eliminated that presumption. The OCC will instead review indirect arrangements case by case under the statute’s anti-evasion provision; it did not define interest or yield or adopt safe harbors.

Federal-Florida Connection
Section 560.506 of the Florida Statutes authorizes the Financial Services Commission to adopt rules implementing Part V of Chapter 560, including Section 13 of the Genius Act. The OCC’s final rule generally does not govern issuers that remain under Florida supervision (other than in unusual and exigent circumstances), but final federal rules and substantial- similarity standards are likely to influence Florida’s treatment of affiliate, coordinated and third-party reward arrangements.

Rulemaking Remains Active
Comments on the U.S. Department of the Treasury’s proposed rule governing payment stablecoin issuance, offers and sales were due Oct. 19. Comments on the Federal Reserve’s two Sept. 24 proposals — one for board-supervised issuers and one for insured state member banks seeking approval for issuing subsidiaries — are due Nov. 30.

Comment periods have closed for several other proposals, including federal AML, sanctions and customer-identification requirements, Treasury’s substantial-similarity principles and certain Federal Deposit Insurance Corp. and National Credit Union Administration measures, but final rules have not been issued.

Florida’s statute is operative and specifies core application requirements, but implementing forms, procedures and supplemental requirements remain pending. Businesses should comply with the statute now and keep reward programs flexible pending final federal and Florida rules.

Florida Implementation and Possible Conforming Amendments
The Financial Services Commission adopts implementing rules, while the OFR administers licensing, examination, supervision and certification submissions. To support federal substantial-similarity certification, the agencies likely will need a focused implementation package addressing at least the following:

• Licensing and supervision: application, renewal, notice, change-of-control, examination, reporting, enforcement and interstate supervision procedures.
• Prudential standards: quantitative capital, liquidity and risk-management requirements, together with governance, recovery and orderly redemption planning.
• Reserves and redemption: eligible assets, segregation, custody, valuation, concentration, permitted use, redemption timing and fees, monthly attestations and public disclosures.
• Custody implementation: eligible custodians and subcustodians; segregation, titling and control of reserve assets; limits on liens, pledges, rehypothecation and unauthorized use; reconciliation and records; private key, cybersecurity and continuity safeguards; custodian oversight; OFR access; notice or approval of custodian changes; and distinctions among custody of reserves, payment stablecoins and other customer assets.
• Customer and operational protections: safeguarding of customer assets, books and records, operational resilience, cybersecurity, and complaint handling. Any additional insolvency priority requirements should be addressed through conforming legislation if final federal standards exceed existing Florida authority.
• AML and sanctions compliance: Florida requirements coordinated with final Financial Crimes Enforcement Network, Office of Foreign Assets Control and other federal standards. Any additional technological or lawful order capabilities required for substantial similarity should be adopted by rule only within existing authority or addressed through conforming legislation.
• Interest, yield and rewards: rules implementing Section 13 of the Genius Act, including affiliate, white-label and indirectly funded reward arrangements.
• Possible statutory amendments: Operational requirements concerning reserves, custody, controls, records, oversight and customer asset protection likely can be adopted by rule under existing authority.

Conforming legislation may be needed, however, if other final federal rules or certification standards require new property rights, an express insolvency priority or bankruptcy estate exclusion, direct regulation of third-party custodians outside the OFR’s jurisdiction, broader lawful order technology mandates, or additional examination, enforcement, information- sharing or receivership powers.

Certification Remains a Gating Matter
Florida may administer its licensing statute before federal certification. For Florida and its supervised issuers to receive state-qualified status under the Genius Act, however, the Stablecoin Certification Review Committee must certify the regime as substantially similar. Section 560.505 of the Florida Statutes directs the OFR to seek certification and annual recertification.

Treasury’s certification standards remain proposed. An interim procedural rule took effect Sept. 30, but Treasury will not accept certifications until the related information collection is approved under the Paperwork Reduction Act. The interim rule also allows a state regulator to satisfy the statutory initial-certification deadline by submitting any form of certification, even if conditional on planned legislative or regulatory work, by Jan. 18, 2028. Comments on the interim rule are due Nov. 30, 2026.

Florida also must complete rulemaking, and each applicant must obtain the required OFR license or trust-company approval and satisfy applicable notice and compliance requirements. Final federal rules may require Florida changes, and issuers must remain eligible and below the Genius Act’s $10 billion state-supervision limit unless waived. These steps may proceed on different timelines.

Choosing a State or Federal Pathway
Eligible nonbank issuers should compare Florida and other certified state regimes with OCC approval based on available approvals, permitted activities, capital and liquidity requirements, supervisory fees, examination expectations, existing compliance infrastructure, and projected issuance. The OCC’s final rule now supplies the federal benchmark, including its $5 million capital floor, 12-month operational backstop and 5% on-demand reserve liquidity requirement, although the OCC has not yet begun accepting applications.

A state pathway may suit an issuer that can use existing state infrastructure and remain within the $10 billion limit. Meanwhile, federal approval may avoid a later supervisory transition for an issuer expecting to exceed that limit, unless a waiver is available.

Neither route should be assumed to be cheaper or faster. Confirm certification and operational readiness, and assess separately any custody, transmission or other digital asset service provider licenses: Issuer approval under either pathway is not a general digital asset service provider authorization.

Before committing capital or setting a launch date: (1) Identify each party’s role; (2) select the issuer, jurisdiction and regulatory pathway; (3) confirm that required rules, certification and approvals are available; (4) test reserve, redemption, custody, disclosure and compliance controls; and (5) preserve contractual and budget flexibility for regulatory delay or change.

Treat returns tied solely to holding or using a stablecoin as prohibited unless you confirm otherwise. Review affiliate, platform, white-label and funded reward programs for issuer involvement, document any independent funding and control, and consider modifying or ending rewards in light of the final OCC and any subsequent Florida requirements.

Conclusion
The Florida act and the Genius Act establish a more formal prudential framework while preserving important federal, state and issuer intermediary distinctions. Issuers, service providers and counterparties should address regulatory status, reserves, redemption, custody, compliance and insolvency risk in governance, diligence and contracts. Counsel should pay close attention to the regulatory pathway, and allocate responsibilities and preserve flexibility for evolving rules, certification and approval timelines.

To read the original Law360 article, click here.

Rob Brighton is a corporate transactional attorney who concentrates his practice in the areas of securities, corporate finance, mergers, acquisitions and divestitures, private equity and venture capital. Admitted to The Florida and New York Bars, Rob serves on various business-law-related committees of the American Bar Association, as well as The Florida and NY Bar, including Committees on M&A Transactions, Private Equity and Venture Capital, Commercial Finance, Legal Opinions, Federal Securities Regulation, Corporate Governance, and Small Business. He is a Co-Founder and 2024 Chairman of the ACG Florida Capital Connection Program.

Rob frequently writes and speaks on topics in the corporate and securities law areas.