Passing a law is the dramatic part. Writing the rulebook is where the future actually gets built.
That is where the GENIUS Act now stands.
On February 25, 2026, the Office of the Comptroller of the Currency issued a notice of proposed rulemaking to implement the stablecoin law in real terms. This is not a vague policy statement or a speech about innovation. It is a 211-question proposal that begins to answer the harder questions: who gets to issue payment stablecoins under OCC supervision, what they can do, how reserves must be managed, how quickly redemptions have to be honored, and how far the ban on yield really goes.
That shift matters. The stablecoin conversation is no longer stuck at the level of theory. The law is here. Now the plumbing is being drawn.
Where GENIUS Stops Being Abstract
The GENIUS Act, signed into law on July 18, 2025, created a federal framework for payment stablecoins. At its center is a simple rule: in the United States, payment stablecoins can only be issued by approved entities known as permitted payment stablecoin issuers, or PPSIs.
The OCC proposal is one of the major federal rulemakings required to turn that framework into something institutions can actually operate inside. Other agencies still have work to do. The Federal Reserve Board, FDIC, NCUA, Treasury Department, and state regulators all have implementation roles of their own. But the OCC’s proposal is especially important because its jurisdiction is broad. It would supervise not only subsidiaries of OCC-regulated insured institutions, but also federally licensed nonbank issuers, uninsured national banks, federal branches of foreign banks, and certain qualifying foreign issuers that want to offer and sell payment stablecoins in the United States.
That makes this proposal more than one agency’s housekeeping exercise. It is one of the first serious drafts of what federally supervised stablecoin issuance could actually look like.
The OCC Is Building an Entry Gate
The proposal starts with licensing and registration.
Any insured national bank, federal savings association, or insured federal branch that wants a subsidiary to issue payment stablecoins would need OCC approval. So would uninsured national banks, uninsured federal branches, and nonbank entities seeking a federal license to issue. Foreign payment stablecoin issuers would also have to apply if they want to sell into the U.S. market.
The process is structured, but not open-ended. The OCC would have 30 days to decide whether an application is substantially complete. Once it is, the application would be deemed approved after 120 days unless the OCC denies it.
That timeline is one of the more striking features of the proposal. It suggests the agency is trying to avoid the kind of regulatory fog that can paralyze a new regime before it begins.
The factors the OCC would use are fairly direct: financial condition, redemption policy, the competence and integrity of officers and directors, and whether any relevant personnel have certain felony convictions involving financial crimes. In other words, the proposal treats stablecoin issuance like something that belongs inside a supervisory perimeter, not outside one.
Yield Is Still the Sharpest Line in the Room
If one issue has the feel of a policy fault line, it is yield.
The GENIUS Act already prohibits a PPSI from paying holders interest or yield solely for holding, using, or retaining a payment stablecoin. The OCC proposal keeps that prohibition, but it does more than simply restate it. It introduces a rebuttable presumption aimed at arrangements where an issuer could try to route yield through an affiliate or third party.
That is a meaningful step. It tells the market the agency is looking not only at what issuers do directly, but also at how they might try to recreate the same economics through side structures.
The proposal does not shut down the conversation. In fact, the OCC is explicitly asking questions about it. Should there be a de minimis exception? A safe harbor for some arrangements? A broader rule that captures indirect payments more aggressively? Should key terms like “yield” or “solely” be defined more clearly?
That is what makes this section so important. The OCC is not pretending the issue is settled. It is showing where the tension is and asking the market to help shape the final line.
Reserves Get Real
Stablecoin policy has always come down to a basic trust question: when the token says one dollar, what sits behind that promise?
The OCC proposal answers that with much more detail than the statute alone. A PPSI would need to maintain identifiable, segregated reserve assets that at all times have a fair value equal to or greater than outstanding issuance. Those reserves would need to consist of the kinds of short-duration, high-quality assets allowed under the statute.
Then the proposal gets more technical.
The OCC lays out two possible approaches to reserve diversification. One is a principles-based standard backed by a safe harbor. The other would make the same quantitative standards mandatory. The proposed metrics include daily and weekly liquidity thresholds, concentration limits at single institutions, and a weighted average maturity cap for reserve assets. For the largest issuers, there is also a requirement to hold a small slice of reserve assets in fully insured deposits or shares, up to a capped amount.
This is not decorative compliance language. It is the agency trying to shape stablecoin reserves into something resilient under pressure. The proposal even spells out what happens if a PPSI falls short. If reserve backing slips below one-to-one, the issuer would need to notify the OCC and stop issuing new stablecoins. If the deficiency lasts too long, liquidation and redemption would begin.
That is the rulebook speaking in full sentences.
Redemption Means a Clock Starts Running
One of the strongest signals in the proposal is that redemption is not being left vague.
The OCC would define “timely redemption” as no more than two business days after a redemption request. That creates a baseline the market can actually understand. It also creates something regulators can supervise against.
The proposal does leave room for stress. If redemption requests exceed 10% of outstanding issuance value in a single 24-hour period, the redemption period would automatically extend to seven calendar days. The OCC could extend further if it determines that doing so is necessary for safety, soundness, financial stability, or the public interest.
That is one of the clearest illustrations of the proposal’s overall style. It is trying to balance straightforward customer expectations with mechanisms for orderly behavior during pressure events.
Risk Management Without a Cookie Cutter
For all its detail, the proposal does not try to flatten every stablecoin issuer into the same shape.
On risk management and capital, the OCC leans heavily on principles-based supervision. PPSIs would need internal controls, information systems, internal audit, interest rate risk management, information security programs, liquidity and concentration controls, and due diligence around service providers. But the exact implementation is meant to scale with the business model and risk profile of the issuer.
The same is true for capital. The OCC is not proposing a universal minimum capital ratio for all PPSIs. Instead, it would set individualized requirements, especially during the first three years of a de novo issuer’s life under supervision, with a minimum floor of $5 million. After that, capital would need to remain commensurate with the risks the issuer faces.
On top of that, each PPSI would need an operational backstop equal to 12 months of total expenses, held in separate high-quality liquid assets.
This is one of the most consequential parts of the proposal because it suggests the OCC sees operational risk, not classic bank credit risk, as the main capital story in stablecoin issuance.
Foreign Issuers and State Pathways Still Matter
The OCC proposal also reflects the fact that GENIUS was not designed as a one-lane highway.
State-regulated issuers can stay at the state level up to a point. If a state-regulated nonbank PPSI crosses $10 billion in outstanding issuance, it generally has to transition into a joint federal-state framework unless the OCC grants a waiver. The proposal explains how that threshold process would work and what factors the OCC would use to evaluate waiver requests.
Foreign issuers are also in the frame. A qualifying foreign payment stablecoin issuer could register with the OCC and offer and sell in the United States, provided it meets specific conditions, including a Treasury determination that its home-country regime is comparable and consent to U.S. jurisdiction and supervision in the relevant areas.
That gives the proposal a broader significance. It is not just about new domestic charters. It is about how the U.S. wants the stablecoin perimeter to interact with state systems and global issuers too.
Custody Is No Side Issue
One of the quieter but more important parts of the proposal deals with custody.
The OCC would impose requirements on OCC-regulated institutions that hold payment stablecoin reserves and related assets as custodians, regardless of which regulator supervises the issuer itself. Covered assets would need to be segregated, treated as customer property, shielded from creditor claims where required, and handled under minimum principles-based standards.
That means the proposal is not only about issuing stablecoins. It is also about how the assets behind them are held, controlled, and protected once the system starts operating at scale.
The Questions Matter as Much as the Answers
The proposal asks 211 specific questions. That detail is not filler. It is the clearest sign that the OCC knows some of the hardest design choices are still open.
It asks about customer definitions, application standards, permissible activities, reserve haircuts, the scope of redemption rights, the shape of capital requirements, the economic effect of yield restrictions, the treatment of foreign exchange risk, and how to minimize adverse effects on credit creation and competition.
That is what serious implementation looks like. Not pretending all the answers are obvious. Putting the difficult ones in public.
The Real Story
The big story here is not just that the OCC proposed rules. It is the kind of rules it proposed.
This is a framework that tries to bring stablecoin issuance into a supervised federal architecture without treating every issuer like a traditional bank. It is detailed where the market needs hard edges, especially on reserves, redemption, and yield. It is more principles-based where business models are still evolving. And it clearly assumes that stablecoins are no longer a peripheral policy issue.
The comment deadline is May 1, 2026. Between now and then, the real fight will not be over whether stablecoins need a rulebook. That part is settled. The question is how strict, how flexible, and how bank-like that rulebook should be.
