OCC Issues Final Stablecoin Regulations Under GENIUS Act Framework
Final regulations from the Office of the Comptroller of the Currency address payment stablecoin issuance requirements and custody operations, with GENIUS Act provisions becoming effective mid-January.
On Wednesday, the US Office of the Comptroller of the Currency completed its regulatory framework governing payment stablecoin reserve requirements, redemption procedures, and associated custody operations, putting into practice the GENIUS Act for institutions falling within its regulatory scope.
According to the completed regulation, entities issuing stablecoins are required to hold reserves with a value no less than the total amount of stablecoins in circulation and must typically fulfill redemption requests within a two-business-day timeframe.
The regulatory framework is applicable to national banking institutions, federal savings associations and federal branch locations, along with their subsidiary entities, in addition to nonbank organizations that apply for or obtain federal qualified issuer designation, the agency's announcement indicates. The rule extends to state-qualified issuers in circumstances where the OCC possesses regulatory or enforcement jurisdiction over their operations.
Both the regulation and the GENIUS Act are scheduled to become effective Jan. 18, 2027.
We are providing a clear, practical framework for payment stablecoin innovation, with strong standards for reserve backing, redemption, and risk management.
Comptroller of the Currency Jonathan Gould
The OCC eliminated a previously proposed presumption that specific arrangements involving affiliated entities or related third-party organizations constitute violations of the legislation's yield prohibition. The finalized regulation maintains the prohibition against issuers providing interest or yield payments to holders solely based on holding, using or retaining their stablecoins. The regulatory body indicated it preserves its authority to take action against efforts to circumvent this prohibition.
The OCC indicated it will make a separate announcement regarding when it commences accepting issuer applications and waiver requests; the agency along with Treasury will tackle Bank Secrecy Act, anti-money-laundering and sanctions compliance requirements through separate rulemaking proceedings.