First Out of the Gate: the OCC finalises its GENIUS Act stablecoin rule
The Office of the Comptroller of the Currency has become the first US federal regulator to finalise its implementing rule under the GENIUS Act, the federal payment stablecoin framework President Trump signed into law in 2025. The final rule, announced 21 October 2026, sets out a licensing and supervisory framework for “permitted payment stablecoin issuers” — both banks and non-bank companies — along with custody standards for the assets backing stablecoins and requirements for foreign issuers operating under OCC jurisdiction. It takes effect 18 January 2027, with a separate announcement to follow on when the OCC will begin accepting issuer applications and waiver requests. Anti-money laundering, OFAC sanctions, and Bank Secrecy Act obligations are being handled separately with Treasury, so this rule is only part of the compliance picture issuers will face.
Clear, practical, first off the rank
Comptroller Jonathan Gould described the rule as providing “a clear, practical framework for payment stablecoin innovation,” while Treasury Secretary Scott Bessent said it “carries that landmark legislation forward, providing a clear, practical foundation” for private-sector growth. The FDIC, the Federal Reserve, and Treasury all have their own GENIUS Act rulemakings still in train, and none of the agencies met the statute's mid-year deadline — so the OCC's rule is the first data point on how literally regulators will read the Act, not the last word on the regime as a whole.
The rewards rub
The most closely watched provision is also the one the OCC changed between proposal and final rule: how to treat stablecoin “rewards” programmes against the GENIUS Act's ban on issuers paying interest or yield directly. The OCC's earlier proposal would have presumed certain third-party rewards arrangements unlawful. The final rule drops that presumption entirely. Instead, the agency will assess programmes case by case, turning on whether a reward is paid solely because someone holds the stablecoin — a reward paid at least partly for some other reason falls outside the ban. Existing rewards programmes get no grandfathering:
We decline to presume that rewards programs that predated the GENIUS Act comply with the GENIUS Act. — Office of the Comptroller of the Currency
That is a live commercial question, not a theoretical one. PayPal pays up to 4% on PYUSD, Coinbase pays 3.75% on USDC, and Kraken pays up to 4.5% on USDG — all run through secondary platforms rather than paid directly by the issuer, which is exactly the structure the GENIUS Act's interest ban was aimed at constraining. Community banks, who see these programmes as drawing deposits out of the banking system, had hoped the stalled CLARITY Act would resolve the question legislatively first. The OCC rejected that sequencing outright, stating it “must implement the GENIUS Act's yield prohibition, as enacted” regardless of what happens to pending market-structure legislation.
What now
Entities considering, or already running, a US payment stablecoin business should:
review any existing rewards, referral, or loyalty arrangement tied to a stablecoin against the “solely for holding” test, rather than assuming a secondary-platform structure is automatically safe;
track the OCC's forthcoming announcement on when it will begin accepting permitted payment stablecoin issuer applications and waiver requests;
monitor the parallel GENIUS Act rulemakings at the FDIC, the Federal Reserve, and Treasury, since custody, reserve, and AML requirements will not be finalised on a single timeline; and
for foreign issuers with US-facing stablecoin activity, assess exposure to the OCC's jurisdiction under the rule's foreign issuer provisions ahead of the 18 January 2027 effective date.
The OCC's approach — a federal prudential licence with a case-by-case, substance-over-form test for yield-adjacent products — sits closer to the UK's emerging Bank of England/FCA joint stablecoin regime than to the EU's more prescriptive MiCA e-money token rules, which cap issuer activity more categorically. Whether a facts-and-circumstances test for “solely for holding” proves workable at scale, or simply shifts the rewards debate from Congress to OCC examiners case by case, is the question the industry will be watching over the next twelve months.
By Michael Bacina
