The U.S. Office of the Comptroller of the Currency (OCC) softened its approach to third-party reward arrangements in its final stablecoin rule under the GENIUS Act, while preserving the ban on issuers paying interest directly.
According to The Block, the OCC became the first agency to finalize its own rule under the law with a regulation published on Wednesday, October 21. The regulation, which takes effect on January 18, 2027, establishes a framework for banks and nonbank companies seeking to issue payment stablecoins.
What changed in stablecoin rewards?
The initial proposal included a presumption that certain business relationships issuers establish with third parties could be unlawful. This provision was not included in the final text. As a result, relationships connected to reward programs will be assessed on their own terms rather than being subject to that presumption in advance.
The GENIUS Act prohibits stablecoin issuers from paying interest directly. However, it does not entirely prevent platforms like Coinbase from offering rewards to users. The change in the final rule is important for how the distinction between these two practices will be overseen.
A regulatory official speaking to reporters said relationships between issuers and third parties will be assessed on a case-by-case basis. The agency can take enforcement action against arrangements it clearly determines were established to circumvent the ban on direct interest payments. The change therefore does not amount to unconditional approval of all reward programs.
Why are banks opposed?
Stablecoin rewards are one of the main points of disagreement between banks and crypto companies. Banks argue that users moving their deposits to these platforms to earn yield could weaken their own funding sources.
The same debate also came to the fore in discussions over the CLARITY Act, which aims to introduce broader crypto regulation in the U.S. The process had stalled because the bill failed to advance in a procedural vote in the Senate.
Who does the new rule cover?
The OCC’s regulation addresses operating pathways for permitted payment stablecoin issuers, as well as foreign issuers and asset custody standards. Reserve backing, stablecoin redemption, and risk management are among the framework’s core topics.
The GENIUS Act requires stablecoins to be fully backed by U.S. dollars or similarly liquid assets and provides for annual audits. Other agencies are also continuing their work on the parts of the law that fall within their areas of responsibility.
Not investment advice.