On February 25, 2026, the Office of the Comptroller of the Currency (OCC) announced a proposal aimed at implementing significant portions of the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act), initially signed into law in July 2025. This act establishes a comprehensive regulatory framework for the issuance of stablecoins, outlining general regulatory and licensing requirements for permitted payment stablecoin issuers. The OCC’s proposal marks a significant step in clarifying the structural framework necessary for entities looking to issue stablecoins under federal supervision.
The proposed rule outlines specific requirements applicable to payment stablecoin issuers operating under the OCC’s jurisdiction. This includes subsidiaries of national banks, federal savings associations, federal qualified payment stablecoin issuers, and state qualified payment stablecoin issuers that fall under OCC authority. The proposal invites public commentary for 60 days following its publication in the Federal Register, acknowledging the complexities involved in establishing regulations for new technologies in the financial sector.
Key Provisions of the Proposed Rule
The proposed rule emphasizes the necessitate for clarity on the activities permitted for entities designated as “permitted payment stablecoin issuers” (PPSIs). According to the Act, only PPSIs can issue “payment stablecoins” in the U.S. This designation limits offerings from “digital asset service providers” unless the stablecoin is issued by a recognized PPSI. The OCC is positioned as a primary regulator for these entities, with additional roles held by the Federal Reserve and FDIC for certain subsidiaries of state-chartered banks.
The Proposed Rule stipulates that PPSIs may only engage in specific activities, including:
- Issuing or redeeming payment stablecoins.
- Managing related reserves.
- Providing custodial or safekeeping services for payment stablecoins and required reserves.
- Other activities that directly support these enumerated functions.
Regulatory Framework for Interest Payments
A contentious issue within the financial services industry has been whether stablecoin issuers should be allowed to pay interest or yield on stablecoins. The Act explicitly prohibits PPSIs from paying interest or yield to holders in connection with the retention of payment stablecoins. However, it does not extend this prohibition to payments made by affiliates or third-party intermediaries.
The Proposed Rule introduces an anti-evasion presumption, suggesting that certain arrangements with affiliates may constitute prohibited payments. For instance, if a stablecoin issuer pays interest to an affiliate, which then pays interest to holders of the stablecoin, this may be seen as circumventing the regulation. The OCC clarified that this rule does not prevent merchants from offering discounts to customers using specific stablecoins or from sharing profits with non-affiliated partners.
Prudential Requirements for Reserve Assets
A key distinguishing feature of stablecoins is their backing by identifiable reserves. Under the Act, each PPSI must maintain reserves against issued payment stablecoins on at least a one-to-one basis. The Proposed Rule requires that the fair market value of a PPSI’s reserve assets must always equal or exceed the issuance par value of outstanding stablecoins. This ensures that issuers can effectively meet redemption requests, especially during adverse conditions.
while the Act does not specify conditions for withdrawing excess reserves, the Proposed Rule allows for such withdrawals only on a monthly basis following a certification from a registered public accounting firm. The OCC is likewise seeking public input on whether to introduce capital-based overcollateralization or buffer requirements.
Implications for the Financial Sector
The OCC’s proposal is poised to have significant ramifications for the broader financial services landscape, particularly as the demand for stablecoins continues to grow. The proposed rules aim to ensure transparency and stability in the market, which could enhance consumer confidence and promote wider adoption of stablecoin technologies.
the OCC has indicated that the regulatory framework will be subject to periodic updates to reflect the evolving nature of the stablecoin market. This ongoing adaptability will be crucial as new technologies and practices emerge within the financial ecosystem.
As public comments are collected over the next two months, stakeholders—including financial institutions, crypto firms, and regulatory bodies—are encouraged to provide input that could shape the final rules. This collaborative approach aims to balance innovation with the necessary oversight to protect consumers and maintain market integrity.
the OCC’s proposed rule represents a pivotal moment for the future of stablecoins in the United States. As the regulatory landscape continues to evolve, stakeholders will need to stay informed and engaged with the process to ensure a robust and secure framework is established for this burgeoning sector.
Readers are encouraged to share their thoughts on the proposed regulations and what implications they foresee for the future of stablecoins in the financial markets.
