OCC Proposes First Federal Rulebook for U.S. Payment Stablecoin Issuers Under GENIUS Act

Overview

• Issuers under OCC jurisdiction would need segregated 1:1 reserves held in permitted assets such as cash, short‑term Treasurys, and qualifying repos, with diversification options and added requirements for very large issuers.
• The draft rule requires clear redemption policies and completion of redemptions within two business days, with only limited, regulator‑authorized exceptions during stress.
• The proposal bars issuers from paying interest or yield and creates a rebuttable presumption targeting certain affiliate or third‑party arrangements that deliver yield to holders.
• De novo issuers would face a $5 million minimum capital requirement plus an operational backstop equal to the prior 12 months of expenses, kept separate from reserves.
• The framework outlines an application process in which the OCC must rule on substantial completeness within 30 days and a substantially complete application is deemed approved on day 120 absent a written denial.