Office of the Comptroller of the Currency Issues GENIUS Rules, Cuts Daily Reserve Liquidity to 5%
Key Facts
The U.S. Office of the Comptroller of the Currency on October 21, 2026, announced a final rule implementing the GENIUS Act, setting requirements for permitted payment stablecoin issuers and certain related activities under its jurisdiction. The rule covers foreign stablecoin issuers subject to the OCC, as well as certain custody activities conducted by entities it supervises. Comptroller of the Currency Jonathan Gould said the framework includes "strong standards for reserve coverage, redemption and risk management." The Act and the rule take effect on January 18, 2027. The step is therefore limited to payment stablecoin issuance and specified activities, and does not amount to broad regulation of the cryptocurrency sector.
The rule requires issuers to ensure that the value of reserve assets equals or exceeds the value of outstanding stablecoins at all times. It also requires them to hold at least 5% of reserve assets in demand deposits or funds available on demand to meet redemptions. The OCC lowered the minimum daily liquidity requirement from 10% in the proposal to 5% in the final rule, while retaining other requirements, including stress tests. An issuer must notify the OCC within 24 hours if redemption requests exceed 10% of the outstanding issuance value for any stablecoin brand during a 24-hour period. An issuer may request an extension of the redemption deadline, but the rule does not grant an automatic extension.
The OCC justified removing the automatic extension in the proposal by saying an automatic extension of the deadline could exacerbate runs, as it said this "could be procyclical and trigger or intensify runs." The change is among the revisions to the final rule following about 328 comments from cryptocurrency firms, trade groups, banks, nonprofits, academics and individuals. In another provision that drew interest from the stablecoin sector, the OCC removed a rebuttable presumption that would have treated certain affiliate or related-party arrangements as prohibited issuer-paid yield. It left decisions on actual arrangements to the circumstances of each case. The rule does not provide a blanket exemption for rewards programs or service arrangements, but says payments for bona fide services are generally not prohibited unless additional contrary facts emerge.
The rule remains separate from Bank Secrecy Act, anti-money laundering and sanctions provisions overseen by the Office of Foreign Assets Control; the OCC said those matters would be addressed in a separate rulemaking process. The OCC also expects clearer, simpler rules to support payment stablecoin issuance in the short term. Its analysis links reserve requirements to increased demand for short-term U.S. Treasury bills, including bills with maturities of no more than 93 days. The OCC expects stronger demand for these securities to lower short-term Treasury yields. It also estimated that the final fee schedule would save permitted issuers $13.6 million in assessment fees in 2027.
The debate over stablecoin holding rewards leaves an important part of the rule's impact on platforms and customers in question. Issuers will remain prohibited from paying interest directly to coin holders, while The Associated Press reported that platforms may pass yields on to customers as interest-like rewards "on a case-by-case basis." To illustrate the difference in yields when its report was published in October 2026, the agency said Coinbase offered a yield of up to 3.5% on USDC balances, compared with an average of 0.38% for traditional savings accounts, according to the latest Federal Deposit Insurance Corp. figures available at the time. The American Bankers Association objected to the OCC's decision, warning that it threatens "the money banks use to make the loans that power the U.S. economy." The association said the rule would preserve the status quo for cryptocurrency platforms, despite Congress's intent to protect domestic lending.
President Donald Trump signed the GENIUS Act on July 18, 2025, establishing a federal framework for payment stablecoin issuers. According to the Treasury Department, issuing these coins in the United States generally requires a federal or state license starting January 18, 2027. At a later stage, broad restrictions on digital asset service providers offering or selling payment stablecoins in the United States take effect on July 18, 2028, unless the coins are issued by a licensed issuer. The OCC will announce separately when it will begin accepting and processing license applications and exemption requests from entities seeking to become permitted issuers. Under the proposed reporting rule, January 25, 2027, would be the first weekly report date and March 31, 2027, the first quarterly report date, subject to approval by the Office of Management and Budget.