United States – Texas

Other Developments

Texas's Finance Code Section 152.006 statutorily prohibits authorisation of any centralized bank digital currency and bars any action limiting the use of paper currency, a provision that took effect September 1, 2023. Alongside that bar, the Texas Comptroller of Public Accounts administers a state-issued, gold-backed digital currency under SB 2334, with each unit representing a fractional troy ounce of gold held in trust in the Texas Bullion Depository and redeemable under Government Code Chapter 404A. TDB Supervisory Memorandum SM-1037 defines a 'stablecoin' as a virtual currency pegged to a sovereign currency and fully asset-backed and redeemable, bringing such tokens within MSMA licensing even absent proof that reserves are actually sufficient. Chapter 160 of the Finance Code separately requires licensed digital-asset-service-provider money transmitters to file annual proof-of-reserves reports and prohibits commingling of customer funds, functioning as a segregation-style safeguard for custodial platforms. The Department's MSB informational page also references the federal GENIUS Act payment-stablecoin framework, an editorially reclassified reference-tier signal of the incoming federal regime rather than a Texas regulatory instrument in its own right. On the conduct side, the Texas Banking Act prohibits non-bank use of 'bank,' 'bank and trust,' or similar terms in advertising that implies banking-business status, with no exclusion for non-bank agents or vendors. Consumer-fund protection in Texas rests on a mandatory surety bond guaranteeing Finance Code compliance rather than an EU/UK-style segregated trust account, while Supervisory Memorandum SM-1043 separately polices deceptive or ambiguous marketing where affiliated entities jointly advertise financial services under one brand. Absent payments-specific conduct codification, the Texas Deceptive Trade Practices Act provides a broad private and public right of action against false, misleading, or deceptive practices, serving as the state's general-purpose consumer-protection backstop for payments and financial-services promotions. In market structure, the Texas Stock Exchange commenced production trading on July 6, 2026, having raised $275 million in total capital from institutional backers including BlackRock, Citadel Securities, Charles Schwab, JPMorgan Chase, Goldman Sachs, and Bank of America, correcting earlier baseline figures of $161 million and a merely 'projected' 2026 launch. At the federal level, a May 19, 2026 White House executive order directed the Federal Reserve to reconsider longstanding barriers limiting fintech and crypto firms' access to Fedwire and other core payments infrastructure, and the Fed has since proposed a 'Payment Account' prototype offering eligible institutions direct Fedwire, FedNow, and National Settlement Service access subject to a $1 billion activity-based closing-balance limit, with holders barred from acting as correspondents for other institutions. Fifth Third Bancorp has separately agreed to acquire Dallas-headquartered Comerica Bank in a $10.9 billion all-stock transaction, materially reshaping Texas's correspondent-banking and settlement-access landscape, though the deal's closing status as of this cycle remains unconfirmed against an earlier 'expected Q1 2026' timeline. Texas ranks among the top three U.S. states of origin for outbound remittances to Mexico, alongside California and Minnesota, the three together sending $21 billion in 2020. The average US-Mexico remittance fee sat just below 5% of a $200 transfer as of Q1 2025 World Bank data, still above the UN's sub-3%-by-2030 target, even as Remitly overtook Western Union to become the largest U.S.-Latin America money transfer operator by volume. Bitso, a stablecoin-native platform, processed over $6.5 billion in remittances in 2024, more than 10% of the corridor's $64.7 billion total U.S.-Mexico volume, a rail-shift flagged separately for illicit-finance and sanctions-evasion risk assessment beyond this monitor's trust-as-payment-instrument scope. The Federal Reserve's FedGlobal Mexico Service, operated jointly with Banco de México as Directo a México, continues to let U.S. financial institutions send ACH credit transactions with FX conversion directly to Mexican financial institutions through a low-cost bank channel. On operational resilience, 7 TAC §33.30 requires prompt confidential reporting to the Banking Commissioner of material cybersecurity incidents affecting an MSB, an affiliate, or a third-party service provider within 15 days of a triggering determination, while the Department separately maintains a Ransomware Self-Assessment Tool for MSBs to gauge preparedness. On scheme compliance, Texas's statutory credit-card surcharge ban has been unenforceable since a 2018 federal court ruling, leaving surcharging permitted subject to a 4% cap and disclosure rules, even as a debit-card surcharge remains treated as a prohibited debit interchange fee; a prospective Illinois-style bill barring swipe fees on sales tax and tips remains at proposal stage, with Texas cited among roughly eleven states carrying the 'highest threat of enactment' after a prior 2023 version failed to advance. The Texas State Securities Board has entered more than 70 administrative orders against crypto-related individuals and entities as of July 2026, the first state securities regulator to bring a crypto enforcement order. The Texas Attorney General has sued the federal government over asserted SEC jurisdiction to regulate digital-asset markets, arguing the arrangement deprives states of sovereign authority to tailor their own digital-asset regulation. The U.S. District Court for the Eastern District of Texas vacated FinCEN's rule requiring reporting of non-financed residential real-estate transfers to entities and trusts, ruling on March 19, 2026 in an Administrative Procedure Act challenge brought by Flowers Title Companies, LLC. The SEC separately charged a Cypress, Texas resident in a federal complaint filed May 28, 2026 in the Southern District of Texas over an alleged $12.3 million AI-powered crypto-trading fraud scheme. In merchant acquiring, Texas has no bespoke acquiring-licensing regime, leaving cost structure shaped by the 4%-capped surcharge recovery against materially cheaper ACH processing (roughly $0.20-$1.50 flat versus 3-4% for card processing), with the Department of Banking's MSB examination authority extending indirectly into acquiring-adjacent oversight, evidenced by a May 1, 2026 consent order against KyckGlobal, Inc. From a product-innovation lens, the same Section 152.006 anti-CBDC bar blocks any state-facilitated centralised bank digital currency product, while SB 2334 authorises Texas's first-mover, Comptroller-administered gold-backed digital currency, transferable electronically and redeemable for money under Government Code Chapter 404A. Consumer protection continues to run through the DTPA's private right of action rather than a mandatory scam-reimbursement scheme, with the Attorney General's Consumer Protection Division pursuing public DTPA enforcement and the Department of Banking issuing a May 12, 2026 consumer alert on 'Broker Imposter Scams' as part of a proactive public-warning practice. Beyond the Fifth Third-Comerica transaction, this cycle's Texas commercial-intelligence signals include a $2.2 million seed round for Coba, a Mexico-facing U.S. banking-access product, and Goldman Sachs's announced $500 million, 5,000-employee Dallas campus, both consistent with deepening North Texas financial-institution investment.

Cross-Monitor Connections

Two threads in this cycle's Texas findings are flagged onward to the Financial Integrity Monitor rather than resolved within this brief. First, Bitso's capture of a rising share of US-Mexico remittance volume via stablecoin rails warrants illicit-finance and sanctions-evasion risk assessment beyond this monitor's trust-as-payment-instrument scope. Separately, the Eastern District of Texas's vacatur of FinCEN's real-estate AML reporting rule narrows a federal illicit-finance reporting requirement whose original AML-scope analysis belongs to the Financial Integrity Monitor rather than to this brief. Separately, the AML/CFT intelligence summarised above under the Southwest Border MSB operation and the Ramad Pay consent order is sourced from the Sentinel.gi feed; this brief attributes that material without independently re-analysing the underlying illicit-finance activity.

Outlook

Looking ahead, the Fifth Third-Comerica merger's closing status is the nearest dated milestone to watch: the transaction was expected to close in Q1 2026, a window this cycle (July 2026) has already passed without a confirming update, leaving Texas's correspondent-banking consolidation trajectory provisionally unresolved. FinCEN's Southwest Border posture is expected to persist through the remainder of 2026, meaning further Texas-specific notices of investigation or joint state enforcement actions of the Ramad Pay type are a reasonable near-term expectation. Against that backdrop, Texas's parallel track of payments-access liberalisation, anchored in the Federal Reserve's still-pending Payment Account proposal, and its state-level digital-asset policy divergence are likely to remain the two structural forces shaping the jurisdiction's regulatory trajectory into the next cycle.

Outlook

Texas's regulatory trajectory is best described as diverging rather than converging: enforcement intensity is rising even as payments-access policy liberalises, and the nearest confirmatory milestones are the Fifth Third-Comerica closing status, the continuation of FinCEN's Southwest Border posture through 2026, and whether the Federal Reserve finalises the Payment Account proposal that would reshape correspondent-banking dependence for Texas-headquartered fintech and stablecoin-issuer firms.