The Federal Reserve has announced new restrictions on stablecoin interest payments under the GENIUS Act, as stated by official Austan D. Musalem. This regulation mandates that stablecoins primarily function as payment tools, impacting issuers such as Tether and Circle. The move aims to prevent stablecoins from being used as unregulated deposit instruments, effectively ending yield-earning programs and steering their use towards payment utilities. This regulatory change is expected to have significant implications for DeFi platforms and the broader financial stability landscape. By curbing interest payments, the Federal Reserve seeks to ensure that stablecoins do not operate outside the traditional banking system's regulatory framework.