Source: Crypto in America, compiled by OCC; curated by Shan Oba, Golden Finance
On October 21, the Office of the Comptroller of the Currency (OCC) issued Bulletin 2026-50, formally finalizing the implementing rules for the GENIUS Act. The more than 700-page rule establishes federal standards for payment‑type stablecoin issuers and will take effect on January 18, 2027.
As a result, the OCC has become the first federal banking regulator to finalize the core rules under the GENIUS Act, outpacing both the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC)—which have so far issued only proposed regulations. The Treasury Department is also developing its own set of rules. Compared with the February proposal this year, the final rule represents a clear shift in two key areas: it abandons the presumptive violation provision targeting stablecoin rewards and relaxes several restrictions on issuers' reserve‑management practices.
I. What does the rule say?
The core provisions of the final rule are codified in a new Part 15 of Title 12 of the Code of Federal Regulations (12 CFR 15), covering matters such as the scope of operations, reserve assets, redemptions, risk management, auditing and reporting, custody, and the transition of state‑qualified issuers to the federal framework. The rule also encompasses license applications and registration, inspection and oversight of foreign issuers, revocation or withdrawal of approval under specified circumstances, as well as capital and operational backstop requirements.
In addition to the newly established provisions, the OCC has also amended four existing rules: Capital Adequacy Standards (12 CFR 3), Prompt Corrective Action (12 CFR 6), Fee Assessment (12 CFR 8), and Rules of Practice and Procedure (12 CFR 19).
According to the announcement, with the exception of rules related to the Bank Secrecy Act, anti‑money laundering, and OFAC sanctions, all regulations that the OCC was required to adopt under the GENIUS Act have now been finalized; the aforementioned exceptions will be issued separately following coordination with the Treasury Department.
II. Who is in charge?
The scope of the rule encompasses the National Bank and its subsidiaries, federal savings associations and their subsidiaries, federal branches and their subsidiaries, foreign payment‑stablecoin issuers, nonbank institutions that have applied for or been approved as federally qualified payment‑stablecoin issuers, and state‑qualified payment‑stablecoin issuers supervised by the OCC.
This scope corresponds to the regulatory division of responsibilities under the GENIUS Act: the OCC exercises supervisory or enforcement authority over the entities mentioned above, with state‑chartered issuers' authority deriving from Sections 4 and 7 of the Act. For community banks, if they are not involved in the issuance of payment‑stablecoins, the new regulations do not impose a direct compliance burden.
III. The "loophole" in stablecoins remains open
The most closely watched change is that the OCC has removed a provision from the proposal that would have presumed certain arrangements between stablecoin issuers and third parties to violate the GENIUS Act's ban on interest payments.
The "GENIUS Act" prohibits issuers from paying interest or yields to holders, but it does not explicitly forbid third parties, such as crypto exchanges, from offering rewards on stablecoin balances. Banking industry groups have dubbed this a "stablecoin loophole" and have been actively lobbying to close it.
The final rule abandoned the "presumption of noncompliance unless the issuer can demonstrate compliance" approach, opting instead for case-by-case review and enforcement action against violations or attempts to circumvent the ban. "We're simply letting the market evolve on its own and addressing issues as they arise," an OCC official told reporters, adding that the agency may issue further guidance as the market continues to develop. He declined to comment on whether existing exchange‑based reward programs comply with the rule, and the OCC also rejected calls to exempt pre‑existing reward schemes from the new regulations.
This disagreement is directly tied to the negotiations over the Clarity Act. Stablecoin yields are a bottom line for banks, which advocate limiting stablecoin rewards held in accounts rather than used for trading, warning that such payments could drain deposits and undermine lending. After the bill failed to pass the Senate in September, banks shifted their hopes to the OCC tightening its regulations; Brooke Ybarra, Senior Vice President of the American Bankers Association, confirmed this in a previous interview with Crypto in America.
But the final rule failed to close the loophole. "That's why banks should have supported the Clarity Act," said a crypto industry insider who asked not to be named. "They could have secured stronger safeguards, but now they haven't."
IV. The Issuer Gains Greater Flexibility
In addition to the issue of incentives, the OCC has also relaxed several restrictions in the proposal regarding how issuers manage their reserves. The final rule eliminates the requirement for a 20-day weighted-average maturity of reserve assets, allowing issuers greater flexibility to hold longer‑maturity eligible investments, including U.S. Treasury securities.
The issuer may withdraw excess reserves at any time, no longer subject to the monthly limit, provided it maintains sufficient assets to back the outstanding stablecoins. The cap on holdings with any single counterparty has also been relaxed, while safeguards to manage risk remain in place.
On the redemption front, the OCC has removed the proposed provision that would automatically extend the redemption period during periods of sharply increased withdrawal requests, replacing it with the following: if, within a 24-hour period, redemption requests exceed 10% of the outstanding value of any stablecoin issued, the issuer must notify the OCC within 24 hours. The reserves must continue to back outstanding stablecoins at a minimum 1:1 ratio and comply with liquidity requirements, counterparty risk limits, and stress-testing obligations.
"We are providing a clear, pragmatic framework for innovation in payment‑related stablecoins and setting stringent standards for reserve backing, redemption, and risk management," said Jonathan Gould, Comptroller of the Currency, in a statement.
V. Next, what shall we look at?
The rules will take effect on January 18, 2027, coinciding with the statutory effective date of the GENIUS Act. However, the OCC has yet to announce when it will begin accepting applications from prospective stablecoin issuers, a decision that will determine the timeline for the new framework's actual implementation.
Regulations pertaining to anti‑money laundering and sanctions compliance remain pending, with the OCC and the Treasury Department currently drafting another proposal. For issuers, the boundaries governing reserves and redemptions are now clear; however, whether incentive structures can sustain themselves over the long term and how the ongoing tug-of-war between banks and the crypto industry will ultimately unfold will depend on market dynamics and forthcoming guidance.
Reference:
Crypto in America:
OCC Bulletin 2026-50: