OCC’s Final Stablecoin Rule Backs Off Yield Test, Scraps Automatic Redemption Extension

The Office of the Comptroller of the Currency (OCC) will not presume that stablecoin issuers break the GENIUS Act’s yield ban when affiliates or related third parties pass payments on to holders. The agency removed that test from its final rule implementing the 2025 stablecoin law, which it announced on Wednesday.

The rule applies to stablecoin issuers the OCC licenses and foreign issuers within its reach, as well as certain custody services offered by OCC-supervised entities, which include national banks, federal savings associations and federal branches. It takes effect on January 18, 2027, the same day as the GENIUS Act itself. Rules tied to the Bank Secrecy Act, anti-money laundering and sanctions are not included and will come in a separate rulemaking with the Treasury Department.

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The OCC’s February proposal would have treated certain deals between an issuer and its affiliates or related third parties as violating the statute’s ban on issuers paying interest or yield to holders, unless the issuer rebutted it. The Federal Reserve’s September proposal took a similar approach.

In the final rule text, the OCC wrote that “because payment stablecoins are a nascent market, the OCC does not believe that it is appropriate to impose a rebuttable presumption with respect to the yield prohibition at this time.” The agency said it keeps its authority to act against evasion of the ban, and that it will review arrangements through license applications and ongoing supervision, then issue public guidance when it finds violations.

Issuers must still honor redemptions within two business days. The OCC cut a proposed automatic seven-day extension of the redemption period that would have applied whenever requests topped 10% of outstanding issuance in a day. Under the final rule, an issuer that receives redemption requests above 10% of a stablecoin brand’s outstanding issuance in a single 24-hour period must notify the agency within 24 hours, as the proposal also required, and may ask the OCC to extend its redemption deadline. The agency can approve or deny that request.

The rule keeps a $5 million minimum capital floor and applies it to issuers beyond their first three years, the period the proposal had limited it to.

“We are providing a clear, practical framework for payment stablecoin innovation, with strong standards for reserve backing, redemption, and risk management,” Comptroller of the Currency Jonathan V. Gould said in the agency’s release.

Treasury Secretary Scott Bessent compared the law to President Abraham Lincoln’s National Currency Act of 1863, saying in the OCC’s release that “the GENIUS Act establishes a federal framework for payment stablecoins in the digital age.”

The OCC said it received roughly 328 comments on the proposal. The agency said it will announce in a separate release when it begins accepting applications and waiver requests from prospective issuers.

Related Listen: Why Banks Failed to Kill Stablecoin Rewards in the Clarity Act

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