GENIUS Act Rule Is Final: OCC Offers No Safe Harbor for Existing Stablecoin Rewards - Blockonomi
by Brenda Mary · BlockonomiTLDR:
Table of Contents
- The OCC’s first GENIUS Act rule takes effect on January 18, 2027, covering issuance and custody.
- Existing yield and rewards programs get no grandfathering or automatic safe harbor under the rule.
- Issuers cannot pay yield solely for holding stablecoins, but some third-party rewards may qualify.
- Coinbase, PayPal, and Kraken programs face uncertainty as the OCC reviews each case individually.
The GENIUS Act rule is now final, according to the Office of the Comptroller of the Currency (OCC). It is the agency’s first final rule implementing the stablecoin law. The rule covers issuance, custody, and third-party partnerships. It takes effect on January 18, 2027. Existing yield and rewards programs receive no automatic grandfathering or safe harbor. Instead, the OCC will assess compliance case by case. The rule follows a proposal that drew hundreds of public comments.
What the Final Rule Covers
The final rule sets requirements for permitted payment stablecoin issuers and foreign payment stablecoin issuers under OCC jurisdiction. It also addresses certain custody activities by OCC-supervised entities. Commenters included crypto-focused companies, community bankers, trade groups, and academics.
The GENIUS Act rule covers every regulation the OCC must issue under the law. However, Bank Secrecy Act, anti-money laundering, and sanctions provisions are excluded. The OCC will address those separately, in coordination with the Department of the Treasury.
Comptroller Jonathan V. Gould shared a statement on X about the rule. He said, “We are providing a clear, practical framework for payment stablecoin innovation.” He added that the framework carries “strong standards for reserve backing, redemption, and risk management.” The post also said the rule advances President Trump’s and Secretary Bessent’s vision for American leadership in digital assets.
Gould said the OCC is drawing on its “longstanding supervisory expertise” to support responsible growth. Moreover, the agency will announce in a separate release when it begins accepting applications. That release will also cover waiver requests from prospective permitted payment stablecoin issuers.
Rewards Programs Face Case-by-Case Review
The act prohibits issuers from paying yield solely for holding, using, or retaining stablecoins. However, it does not ban all third-party rewards. The OCC said rewards based at least partly on other factors may fall outside the prohibition.
Existing programs get no special treatment under the GENIUS Act rule. Therefore, rewards paid solely for holding or using a stablecoin remain barred. Meanwhile, how the rule applies to Coinbase, PayPal, and Kraken programs remains uncertain. Each program will face review on its own facts.
Treasury Secretary Scott Bessent also commented on the rule. He said, “The GENIUS Act marks a watershed moment in American finance.” He compared the law to the National Currency Act of 1863, which set a national framework for bank-issued currency. He added that the act further cements the United States as “the crypto capital of the world.”
Bessent said the OCC’s final rule provides “a clear, practical foundation for private-sector innovation, competition, and American leadership in digital assets.” Meanwhile, the OCC will coordinate with other agencies responsible for parts of the act. Given the industry’s nascency, it will adjust its framework to the extent necessary. The rule and the statute both take effect on January 18, 2027.