OCC Finalises GENIUS Act Stablecoin Rules for 2027

The US Office of the Comptroller of the Currency (OCC) has finalised rules implementing the GENIUS Act, setting federal standards for payment stablecoin issuance, reserves, redemptions, custody and risk management. The rules take effect on 18 January 2027 and apply to covered banks, certain subsidiaries and foreign issuers under OCC supervision. Authorised issuers must hold eligible reserves worth at least 1:1 against outstanding tokens, disclose redemption policies and generally complete redemptions within two business days. They must also manage liquidity and meet custody and risk-management requirements. Direct interest payments to holders are prohibited. The final rules drop a proposed presumption against some third-party reward programmes, which will be assessed case by case; arrangements that effectively deliver issuer-paid yield may still breach the law. The OCC also removed a proposal to automatically extend redemption periods after unusually large withdrawal requests. Applications and waiver requests can be submitted once the relevant information collections receive Office of Management and Budget approval. Separate Treasury rules on anti-money laundering and sanctions are still pending. The framework offers stablecoin issuers, exchanges and payment providers greater regulatory clarity, while preserving reserve and redemption safeguards. Banks have warned that rewards could draw deposits away, particularly from community banks. For traders, clearer US stablecoin regulation may support adoption and eventually activity in payments, DeFi and tokenised assets, but the delayed start means any effect on BTC or ETH demand is uncertain and unlikely to be immediate.