The U.S. financial system has entered a new era. With the passage of the GENIUS and CLARITY Acts, stablecoins are now fully recognized under federal law. These digital tokens, which are backed one-to-one by U.S. dollars, have moved from the sidelines to the mainstream of regulated banking.
This is more than a policy update. The new legislation signals a shift in how financial institutions must manage risk and compliance. Financial services leaders now face a critical question: Is our regulatory and compliance infrastructure prepared to absorb and operationalize this change?
Stablecoins are already in wide use as pricing tools, trading instruments, and payment rails. Today, around 99% of stablecoin market cap is denominated in U.S. dollars.
What’s new is the regulatory context. The GENIUS Act establishes a framework for how banks and credit unions can issue and manage stablecoins. The CLARITY Act defines how these digital assets fit into the broader financial system. Together, the two laws will have a major impact on how digital currencies are governed in the U.S.
Qualified financial institutions now have the legal foundation to issue payment stablecoins, offer custody and clearing services through a wholly owned subsidiary, and integrate blockchain-based assets into their operations. While this opens the door to new services and opportunities (e.g., spot clearing on the distributed ledger), it also introduces layers of operational complexity. Institutions will need to revise internal controls, processes, and governance documents to include payment stablecoins. They should expect increased supervision and examination scrutiny of payment stablecoins, particularly around anti–money laundering and sanctions compliance.
Financial institutions will also need to react to macro shifts, like changes to the U.S. Bankruptcy Code, that provide greater customer protection. They’ll also likely need to change how they interact with financial market intermediaries, like the Depository Trust and Clearing Corporation (DTCC) and International Swaps and Derivatives Association (ISDA).
The volume and complexity of change is high. Banks must now track the impact of evolving federal and state guidance, assess legal risk, update internal controls, and document those changes across multiple systems and business units. Many institutions maintain thousands of governance documents—from internal policies and procedures to customer communications, third-party contracts, and regulatory filings—depending on their structure and footprint. All of these will need to be modified and updated to manage risk and avoid noncompliance.
This is not a one-time activity. Compliance teams will have to track how emerging laws reshape existing documentation and controls. They will also need a way to detect gaps, identify outdated requirements, and coordinate updates across distributed teams. The ability to do this quickly and accurately will be a competitive differentiator.
To succeed, governance must become an integrated, technology-enabled capability that supports operational resilience, audit readiness, and sustained regulatory alignment. An AI-powered governance approach delivers benefits beyond updating documents:
With effective dates approaching and regulators actively shaping the landscape, the time to act is now. Financial services leaders that modernize their risk, compliance, and governance functions now will position themselves to lead in a digital-first financial system.
Ready to realize the benefits of AI-driven regulatory compliance? North Highland helps financial institutions strengthen regulatory infrastructure, streamline governance, and respond confidently to change. We help leaders identify areas where AI-powered policy and regulatory intelligence can drive significant compliance improvements and operational efficiencies.