Mike Warner

Comment on FRS-2026-2179-0001 — Stablecoin Reserve Integrity, Unit-Level Provenance, and Supervisory Signatures To Whom It May Concern: We respectfully submit this comment in response to the proposed stablecoin regulatory framework. The central supervisory challenge is not merely whether an issuer can report aggregate reserves, but whether the monetary units issued into circulation can maintain durable, auditable, and privacy-preserving correspondence to lawful reserve backing throughout their lifecycle. The best strategy for meeting the reserve, custody, redemption, and examination objectives of this regulation is to require each dollar-denominated payment stablecoin unit to carry a unique, portable, persistent, provenance-preserving monetary unit identifier. Such an identifier should remain associated with the unit as it is issued, transferred, bundled, aggregated, disaggregated, redeemed, or bridged across permitted ledgers or custody environments. The identifier need not expose private user information. Rather, it should function as a supervisory and technical handle that allows authorized parties to verify issuance, reserve association, custody status, redemption status, and relevant compliance attestations. This approach would materially improve the integrity of one-to-one backing. Aggregate monthly attestations are necessary but insufficient in a high-velocity programmable payments environment. A persistent unit identifier would allow reserve proofs to be expressed not only at the issuer balance-sheet level, but also at the level of circulating monetary objects. Properly designed, these identifiers could support cryptographic proof of reserve, proof of non-duplication, proof of lawful issuance, proof of burn or redemption, and proof that a given unit remains within a permitted payment stablecoin system. The regulation should also contemplate programmatic handles for custody, intelligence, and supervisory access. Stablecoins will increasingly be used by wallets, smart contracts, automated agents, payment processors, and institutional custody platforms. A unit-level identifier with standardized metadata handles would allow regulated systems to bind each unit to machine-readable controls without turning the payment instrument into an uncontrolled bearer claim. These handles could support reserve verification, sanctions and compliance screening, custody chain evidence, audit trails, wallet recovery, and authorized supervisory inspection. For dollar-denominated stablecoins, the Federal Reserve or another designated federal authority should require a multi-key signature framework for certification. A payment stablecoin should not be represented as a regulated dollar-denominated instrument unless issuance is cryptographically signed by the issuer and accompanied by one or more supervisory, custodian, or reserve-verification signatures. Such a design would not make the stablecoin legal tender or imply a federal guarantee. Instead, it would make clear that the instrument has passed defined regulatory controls for issuance, reserve identification, and custody integrity. A multi-key signing requirement would create a stronger distinction between lawful, reserve-backed dollar stablecoins and private unsecured digital liabilities that merely reference the dollar. This distinction is essential to market discipline, consumer protection, financial stability, and the singleness of money. Without unit-level identifiers and supervisory signing, the market may be left with opaque aggregate claims, fragmented issuer practices, and avoidable uncertainty about which digital dollars are actually backed, redeemable, and compliant. We therefore encourage the Board and other relevant agencies to incorporate into the final rule a requirement or safe-harbor standard for unique stablecoin unit identifiers that are portable, persistent, provenance-preserving, cryptographically verifiable, privacy-preserving, and capable of supporting aggregation and disaggregation. Such a standard would make the regulation more technically enforceable, reduce run and contagion risk, and provide the foundation for responsible programmable money within the U.S. dollar system.