The Office of the Comptroller of the Currency (OCC) has asked the public for feedback on its proposed framework for regulating stablecoins under the landmark crypto regulation, including proposals to address potential duty on interest payment restrictions.
OCC Outlines Implementation Framework for GENIUS Rule
On Wednesday, the OCC released a proposed rule to implement a landmark stablecoin law, the National Innovation Guidance and Innovation for US Stablecoins (GENIUS) Act.
The GENIUS Act was signed into law by US President Donald Trump on July 18, 2025. The law establishes a regulatory framework for stablecoin payment operations in the US.
In this 376-page document, the agency also included regulations for approved payment stablecoin issuers and foreign payment stablecoin issuers under the OCC’s jurisdiction and certain custodial activities performed by OCC-supervised companies.
Notably, the OCC will have regulatory authority over certain issuers, such as subsidiaries of national banks or public savings associations, state qualified issuers, state qualified issuers, and foreign issuers.
The proposed rules include all rules the OCC is required to promulgate under the GENIUS Act, including reserve levels, liquidity and maintenance requirements, risk management controls, audits, and supervisory reviews.
However, it exempts it from laws related to the Bank Secrecy Act, Anti-Money Laundering, and Office of Foreign Assets Control sanctions, which will be handled separately by the Treasury Department.
“The OCC has carefully considered the proposed regulatory framework under which the stablecoin industry can grow in a safe and sound manner,” said Director of Currency Jonathan Gould in a statement.
“We welcome feedback on the proposal to introduce a final rule that is efficient, effective and reflects an industry-wide vision. The OCC will continue its work to implement the GENIUS Act and provide OCC-regulated entities with more opportunities to meet the needs of their customers and communities,” he added.
Rules for dealing with Stablecoin Yield Workarounds
The proposed framework also addressed an important issue related to the regulation of these assets: interest payments or yields on stablecoins. In context, the law prohibits paying interest on the holding or use of stablecoins for payment purposes, but only addresses permitted issuers.
Based on this, the banking sector pointed out that the GENIUS Act has “loopholes” that could pose a risk to the financial system and urged senators to include language in the crypto market structure bill, known as the CLARITY Act, which also prohibits digital asset exchanges, brokers, dealers, and related organizations from offering yields.
The OCC expanded the ban on the GENIUS Act, highlighting potential areas that should be targeted to prevent these “loopholes”. The agency argued that issuers could try to fix “prohibited interest payments or provide stablecoin owners with payments through arrangements with third parties.”
However, it noted that due to the large and changing diversity of such arrangements, it would be impossible to identify and address them all. Therefore, it proposed to include a presumption that “certain types of schemes and certain types of persons” would be prohibited payments of interest or interest by the issuer.
The OCC may assume that an issuer pays an owner any interest or yield if: the issuer “has a contract, agreement, or other arrangement with an affiliate or related third party to pay interest or yield to the affiliate or related third party;” and if a related third party member “has a contract, agreement, or other arrangement to pay interest or yield (…) to the owner of any payment stablecoin issued” by the authorized issuer “only in connection with the holding, use, or storage” of these tokens.
However, the OCC clarified that the ban is not intended to prevent a merchant from independently offering a discount to an owner by using stablecoins for payment. It is also not intended to prevent an issuer from “sharing profits from stablecoin payments with a non-affiliated partner in a white label scheme.”
The total crypto market capitalization is at $2.31 trillion in the one-week chart. Source: TOTAL on TradingView
Featured image from Bloomberg.com, Chart from TradingView.com
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