FDIC Signals Move Toward Tokenized Deposit Insurance and Stablecoin Application Framework

The acting chair of the Federal Deposit Insurance Corporation (FDIC), Travis Hill, said the agency is exploring formal guidance for tokenized deposit insurance. It is preparing to launch an application process for stablecoin issuers by the end of the year. 

Hill outlined the regulator’s plans during a speech at the Federal Reserve Bank of Philadelphia’s Fintech Conference on Thursday, signaling a growing willingness among U.S. banking authorities to integrate blockchain-based financial tools into the traditional regulatory framework.

Hill, who has previously expressed optimism about tokenization, reiterated that the legal nature of deposits should remain unchanged regardless of the technology used to store or transfer them. 

“My view for a long time has been that a deposit is a deposit. Moving a deposit from a traditional-finance world to a blockchain or distributed-ledger world shouldn’t change the legal nature of it,” he said, according to Bloomberg. The FDIC, which protects depositors in the event of bank failures, is now examining how those protections would translate into tokenized formats.

Growing Interest in Tokenized Financial Products

The discussion comes amid rising interest from regulators and major financial institutions in tokenizing real-world assets (RWAs). A report from RedStone shows the value of tokenized RWAs, excluding stablecoins, exceeded $24 billion in the first half of the year. Much of that growth came from private credit and U.S. Treasurys, two sectors increasingly experimenting with blockchain-based settlement.

BlackRock has emerged as a major force in the market, launching its tokenized money market fund BUIDL in 2024, accelerating Wall Street’s shift toward tradable blockchain-based financial products. This surge in activity has pushed regulators to clarify how tokenized assets should be supervised, insured, and integrated into existing financial protections.

Stablecoin Application Framework Expected by Year-End

Hill also revealed that the FDIC is developing a stablecoin application regime, which he expects to propose before the end of 2025 as part of implementing requirements under the GENIUS Act, according to Law360. Although it remains unclear how many institutions will seek approval, FDIC staff are designing standards related to capital and reserve requirements, as well as risk-management obligations for banks that issue stablecoins under FDIC oversight.

The stablecoin market has become one of the fastest-growing segments of the digital asset industry. Global stablecoin market capitalization stands at roughly $305 billion as of Friday, according to DefiLlama, with banks and fintech firms worldwide increasingly exploring blockchain-based payment and settlement systems. 

Hill’s remarks suggest the FDIC is preparing to play a central role in shaping how those products evolve within the U.S. regulated banking sector.