GENIUS Act Regulations: Final Rule

DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
12 CFR Parts 3, 6, 8, 15, and 19
[Docket ID OCC-2025-0372]
RIN 1557-AF41
Implementing the Guiding and Establishing National Innovation for U.S. Stablecoins Act for the Issuance of Stablecoins by Entities Subject to the Jurisdiction of the Office of the Comptroller of the Currency AGENCY: Office of the Comptroller of the Currency, Treasury. ACTION: Final rule. SUMMARY: The Office of the Comptroller of the Currency (OCC) is issuing regulations implementing the Guiding and Establishing National Innovation for U.S. Stablecoins Act regarding the issuance of payment stablecoins and certain related activities by entities subject to the OCC’s jurisdiction. DATES: The final rule is effective on January 18, 2027. FOR FURTHER INFORMATION CONTACT: Sarah Turney, Assistant Director, Henry Barkhausen, Special Counsel, Kevin Korzeniewski, Special Counsel, Mark O’Horo, Special Counsel, Daniel Borman, Counsel, or Collin Berger, Attorney, Chief Counsel’s Office, 202-649- 5490, Office of the Comptroller of the Currency, 400 7th Street SW, Washington, DC 20219. If you are deaf, hard of hearing, or have a speech disability, please dial 7-1-1 to access telecommunications relay services. SUPPLEMENTARY INFORMATION:

I. Background and Summary of the Final Rule
The Guiding and Establishing National Innovation for U.S. Stablecoins Act (12 U.S.C. 5901 et seq.) (GENIUS Act or the Act) was enacted on July 18, 2025. The Act establishes a regulatory framework for payment stablecoin activities. 1 Stablecoins are digital assets, i.e., digital representations of value recorded on a cryptographically secured distributed ledger, such as a blockchain. 3 The Act sets forth various regulatory and licensing requirements for permitted payment stablecoin issuers and foreign payment stablecoin issuers. In many instances, the Act states that the specific requirements applicable to these entities (e.g., those related to capital, liquidity, or operational risk management) will be established by regulations issued by the relevant primary Federal payment stablecoin regulator, in coordination with other relevant agencies, as appropriate. 4 On March 2, 2026, the OCC issued a notice of proposed rulemaking (proposal or proposed rule) proposing, and seeking comment on, the regulations that would apply to permitted payment stablecoin issuers and foreign payment stablecoin issuers under the OCC’s jurisdiction (including subsidiaries of insured national banks or Federal savings associations, Federal qualified payment stablecoin issuers, certain nonbank State qualified 1 Under section 2(22) of the Act (12 U.S.C. 5901(22)), “payment stablecoin” means “a digital asset—(i) that is, or is designed to be, used as a means of payment or settlement; and (ii) the issuer of which—(I) is obligated to convert, redeem, or repurchase for a fixed amount of monetary value, not including a digital asset denominated in a fixed amount of monetary value; and (II) represents that such issuer will maintain, or create the reasonable expectation that it will maintain, a stable value relative to the value of a fixed amount of monetary value[.]” The term does not include a digital asset that is (i) a national currency; (ii) a deposit (as defined in 12 U.S.C. 1813), including a deposit recorded using distributed ledger technology; or (iii) a security, as defined in 15 U.S.C. 77b, 78c, or 80a-2. 2 12 U.S.C. 5901(6). 3 White House, “Strengthening American Leadership in Digital Financial Technology,” at 15 (July 17, 2025), (hereinafter, Digital Financial Technology Report), https://www.whitehouse.gov/wp￾content/uploads/2025/07/Digital-Assets-Report-EO14178.pdf. A cryptographically secured ledger uses cryptography to maintain the integrity of the ledger. See also E.O. No. 14178, Strengthening American Leadership in Digital Financial Technology, 90 FR 8647 (January 31, 2025) (defining blockchain to mean “any technology where data is:
(i) shared across a network to create a public ledger of verified transactions or information among network participants; (ii) linked using cryptography to maintain the integrity of the public ledger and to execute other functions; (iii) distributed among network participants in an automated fashion to concurrently update network participants on the state of the public ledger and any other functions; and (iv) composed of source code that is publicly available”). 4 See, e.g., 12 U.S.C. 5903(a)(4), (b), (h).

payment stablecoin issuers, and foreign payment stablecoin issuers) as well as certain custody activities conducted by OCC-supervised entities. 5 The OCC received approximately 328 comments in response to the proposal from a wide variety of commenters, including crypto-focused companies, trade groups, banks, non-profit organizations, academics, and individuals. 6 Commenters had diverging views on several of the proposal’s key provisions. The final rule addresses these comments, as discussed below. However, as discussed in the proposal, the OCC anticipates that these implementing regulations will be updated, as necessary, in the years following the effective date of the GENIUS Act as the business practices of permitted payment stablecoin issuers and foreign payment stablecoin issuers continue to evolve and develop and the OCC gains experience regulating and supervising permitted payment stablecoin issuers. Likewise, the OCC will supplement this final rule with guidance documents, as appropriate. As is its practice in other areas, the OCC will continue to track market developments and meet with interested parties to discuss the regulation and supervision of permitted payment stablecoin issuers, foreign payment stablecoin issuers, national banks, Federal savings associations, and Federal branches under the final rule in the coming years to understand the application of the rule in practice. At a high level, many commenters held differing views with respect to the proposal’s approach concerning reserve asset management, liquidity, and diversification; the prohibition against a permitted payment stablecoin issuer paying interest or yield to a payment stablecoin holder solely in connection with the holding, use, 5 See Implementing the Guiding and Establishing National Innovation for U.S. Stablecoins Act for the Issuance of Stablecoins by Entities Subject to the Jurisdiction of the Office of the Comptroller of the Currency, 91 FR 10202 (March 2, 2026). 6 Although the comment period closed on May 1, 2026, the OCC continued to accept and consider late comments until July 1, 2026.

or retention of such payment stablecoin (yield prohibition); redemption; and the proposal’s capital requirements. With respect to reserve asset management, liquidity, and diversification, commenters differed as to how prescriptive the final rule should be. Several commenters advocated setting principles-based requirements, either with or without a quantitative safe harbor concerning diversification requirements, and making certain changes to the proposed quantitative diversification safe harbor. Other commenters advocated for more prescriptive and quantitative reserve asset management, liquidity, and diversification requirements. Many commenters opposed the proposal’s approach with respect to the yield prohibition. The proposal included a rebuttable presumption that would have presumed certain transactions with affiliates and related third parties violated the prohibition. Many commenters generally favored a strong prohibition that would address a permitted payment stablecoin issuer using a third party to pay interest or yield. Of these commenters, several favored broadening the rebuttable presumption. Others said that a presumption was inadequate, and certain transactions that implicated indirect payments should be conclusively prohibited. In contrast, many commenters advocated for a narrow prohibition and either eliminating or narrowing the rebuttable presumption. Many of these commenters voiced concerns that the proposed rebuttable presumption could capture certain payments to related third parties that were not made solely in connection with the holding, use, or retention of payment stablecoin. Concerning redemption, many commenters argued against imposing a freeze on (or extension of) redemption when there is a spike in redemption requests. Commenters argued that including these types of provisions could accelerate a run. With respect to capital, many commenters generally favored the flexible approach afforded by the proposed rule. Nevertheless,

other commenters advocated a more quantitative and standardized approach. Commenters also addressed several other issues, including definitions; permitted activities; redemption; risk management; audits, reports, and supervision; State issuers; custody; foreign issuers; applications and registration requirements, among other issues. Each of these subjects is addressed in greater detail below. Commenters also provided input concerning requirements relating to Bank Secrecy Act/Anti-Money Laundering (BSA/AML) and sanctions evasion. These comments will be addressed in a separate rulemaking. 7 Likewise, some comments on that separate rulemaking are best addressed in this final rule. Some commenters stated that the OCC should delay finalizing the rule due to uncertainties in stablecoin markets, ongoing legislative efforts, the complexity of the Act and rule, or to facilitate issuance of a joint rule. 8 Some commenters requested that the OCC re-propose any aspects that are inconsistent with the proposals of other agencies that issue rules under the GENIUS Act. The GENIUS Act will be effective on January 18, 2027, and it is important that the OCC’s implementing regulations be effective as of that date. With respect to 7 See Permitted Payment Stablecoin Issuer Anti-Money Laundering/Countering the Financing of Terrorism and Sanctions Compliance Risk Management, 91 FR 37840 (June 24, 2026). On December 8, 2025, the OCC received a petition for regulatory action from Peter Tang at Stablecoin Standards Authority requesting (1) clear, risk-based supervisory expectations for national banks that participate in payment stablecoin activities with the GENIUS framework, (2) consistent application of Federal standards to large offshore U.S.-dollar referenced stablecoin arrangements with a material United States nexus, and (3) a targeted rulemaking to ensure that stablecoin settlement infrastructure is identifiable and subject to ongoing compliance accountability through on-chain node KYC and a Federally administered node registry. The OCC is addressing BSA/AML provisions of the GENIUS Act in a separate rulemaking, and the proposal related to that separate rulemaking was published in the Federal Register on June 24, 2026. The OCC is issuing the final rule consistent with the GENIUS Act and denies Stablecoin Standards Authority’s petition for a separate rulemaking given the BSA/AML proposal. 8 On September 9, 2024, the OCC received a petition for rulemaking from Dmitry Shkipin at HomeOpenly.com requesting that the OCC repeal OCC Interpretive Letters 1170 (July 22, 2020), 1172 (September 21, 2020), and 1174 (January 4, 2021). The petition asserts that virtual currencies are unlawful. The OCC is issuing the final rule consistent with the GENIUS Act and denies HomeOpenly.com’s petition for a rulemaking because these activities are lawful, as explained in the letters, and because many of the stablecoin activities permissible under OCC Interpretive Letters 1170, 1172, and
1174 were expressly affirmed by the GENIUS Act.

legislation, the OCC will revise the final rule, as appropriate, in response to any enacted legislation impacting the OCC’s implementation of the GENIUS Act. In addition, several commenters requested an extension of the comment period or to avoid finalizing the rule until certain legislative clarity was provided or to ensure that the effective date of the Act would be no sooner than January 18, 2027. Commenters also raised concerns regarding interagency coordination and advocated for ensuring that there is alignment among the rules issued by the agencies tasked with implementing the GENIUS Act. Balancing the need to have final rules implementing the GENIUS Act in advance of the statutory effective date against commenters’ desire for additional time to comment on the proposal, the OCC elected not to extend the comment period but did accept and consider comments submitted after the close of the formal comment period. With respect to interagency coordination, the OCC has coordinated closely with the other Federal agencies consistent with section 13 of the GENIUS Act. The OCC has taken seriously its obligation to coordinate with other agencies, as appropriate, and does not believe that it is necessary to do so through a joint rule. The OCC will continue to coordinate appropriately. Commenters provided suggestions on amendments to regulations that should be made in coordination with the GENIUS Act rulemaking. For example, a few commenters noted that the OCC should coordinate with the other Federal banking agencies to amend the standardized bank capital and liquidity requirements to provide for appropriate treatment for payment stablecoins and reserve assets, including that because reserve assets are not available to meet the obligations of a parent entity of a permitted payment stablecoin issuer, they should not be included in parent￾level capital and liquidity requirements. Other commenters stated that the agencies implementing the GENIUS Act should revise their liquidity rules to accommodate the GENIUS Act

framework, including the liquidity coverage ratio and net stable funding ratio. These comments are beyond the scope of this rulemaking, and the final rule therefore does not revise existing regulations to address them. Several commenters raised other issues that are also beyond the scope of this rulemaking. Some commenters requested that the OCC apply certain other statutes to permitted payment stablecoin issuers by rule. The OCC has not done so in this final rule. The scope of statutes that apply to permitted payment stablecoin issuers cannot change by regulation. Thus, the final rule neither subjects permitted payment stablecoin issuers to statutes that would not otherwise apply nor excludes them from the scope of statutes that do apply to their activities. Some commenters stated that the OCC should coordinate with the Board of Governors of the Federal Reserve System (Federal Reserve) concerning designation of certain permitted payment stablecoin issuers as systemically important. Such designation is beyond the scope of this rulemaking, and therefore the final rule does not address such designations. In addition, one commenter requested that the OCC address the tax treatment of payment stablecoins. This issue is outside the scope of this rule and the OCC’s authority and is not addressed in the final rule. Likewise, some commenters brought up antitrust concerns that are outside the scope of this rulemaking. Some commenters raised issues concerning non-payment stablecoins, decentralized finance (DeFi), 9 and crypto-assets more broadly that also fall outside the scope of this rulemaking. Many commenters suggested that the OCC apply various existing consumer protection laws and regulations to permitted payment stablecoin issuers. For example, several commenters pointed to Unfair, Deceptive, or Abusive Acts or Practices (UDAAP) pursuant to section 1031 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 5531), Unfair or 9 DeFi generally refers to the use of blockchain technology to provide financial services on a peer-to-peer basis. Digital Financial Technology Report at 20.

Deceptive Acts or Practices (UDAP) under section 5 of the Federal Trade Commission Act (15 U.S.C. 45), the Electronic Fund Transfer Act of 1978 (15 U.S.C. 1693 et seq.) (EFTA), the Truth in Lending Act of 1968 (15 U.S.C. 1601 et seq.) (TILA), and the Gramm-Leach-Bliley Act (15 U.S.C. 6801 et seq.) (GLBA) as existing consumer protection laws that should apply to permitted payment stablecoin issuers. Commenters argued that consumers should not receive different protections based solely on the technological form of a payment instrument. Some commenters suggested that new consumer protection requirements for permitted payment stablecoin issuers should be drafted rather than simply applying existing statutes and regulations. For example, a few commenters suggested that consumer protection should be addressed in the application and supervisory framework under the GENIUS Act. A few commenters suggested that permitted payment stablecoin issuers should be required to maintain frameworks for managing risks arising from redemption failures, misleading disclosures, or inadequate customer communication. Other commenters suggested that, in addition to traditional fraud risks, specific operational risks such as transaction delays, rejections, and account restrictions should be addressed in the case of permitted payment stablecoin issuers. In contrast, a few commenters argued that consumer protection currently has its own regulatory framework and should not be duplicated. It would be outside the scope of this rulemaking to opine on all the statutes that may be applicable to permitted payment stablecoin issuers. The OCC’s final rule does not alter the scope of the consumer protection laws that apply to permitted payment stablecoin issuers. Several commenters also requested that the OCC take additional action to clarify the treatment of reserve assets upon an issuer’s insolvency. For example, commenters suggested that the rule clarify that reserve assets are held for the benefit of the holders of the issuer’s payment stablecoin or that the assets are not assets of the issuer’s estate. Another commenter suggested

that the OCC rely on its fiduciary rulemaking powers to require that reserve assets be held in a statutory trust or other equivalent legal structure. As discussed in greater detail below, the OCC has made changes in the final rule to accommodate certain structures, including the use of special purpose vehicle (SPV) issuers designed to protect the rights of payment stablecoin holders. One commenter emphasized that it is appropriate to recognize the United States Federal framework already applicable to foreign banks’ United States presence when operationalizing the permitted payment stablecoin framework. Although the International Banking Act of 1978 (12 U.S.C. 3101 et seq.) applies to the United States operations of foreign banks, the GENIUS Act includes additional, specific requirements related to foreign issuers of payment stablecoins in the United States. The OCC is adopting this final rule with certain modifications from the proposal in light of the comments received. At a high level, the final rule makes several changes to the provisions concerning reserve asset management. These changes provide more flexibility to permitted payment stablecoin issuers while still maintaining core liquidity, diversification, and concentration requirements to ensure that permitted payment stablecoin issuers remain sufficiently reserved and capable of meeting redemption requests in a timely manner. The final rule provides additional clarity with respect to a permitted payment stablecoin issuer’s permitted activities, redemption requirements, and risk management obligations. It also includes clarifications concerning the OCC’s supervision of permitted payment stablecoin issuers, custody, and licensing and registration. In addition, the final rule includes capital and operational backstop requirements that are more detailed than, but consistent with, the proposal. The capital elements have also been simplified relative to the proposal. The final rule, like the proposal, imposes requirements consistent with the GENIUS Act that are tailored to the business model

and risk profile of permitted payment stablecoin issuers. For example, as described below, the agency is implementing flexible risk management standards in § 15.13 that scale based on the nature, scope, and risk of a permitted payment stablecoin issuer’s activities. Consistent with certain comments received on the proposal, the final rule facilitates an approach to supervision that focuses on activities over institution type. In addition, other regulations beyond those addressed in this rulemaking may need to be updated in light of the passage of the GENIUS Act. For example, the OCC intends to incorporate references to permitted payment stablecoin issuers and foreign payment stablecoin issuers, as appropriate, into 12 CFR part 4 10 and is considering updates to 12 CFR part 28. These implementing regulations will be effective on January 18, 2027. A. Self-Executing Provisions The proposal discussed certain self-executing provisions of the GENIUS Act but did not propose rule text for these self-executing provisions. 11 For example, the Act includes several provisions addressing the applicability of State law to permitted payment stablecoin issuers. Specifically, section 4(b)(1) of the GENIUS Act (12 U.S.C. 5903(b)(1)) states that, notwithstanding certain Federal law addressing preemption standards for OCC-regulated institutions, 12 and certain State laws, a Federal qualified payment stablecoin issuer “shall be licensed, regulated, examined, and supervised exclusively by the Comptroller.” This provision provides the OCC with the exclusive authority to exercise visitorial powers with respect to Federal qualified payment stablecoin issuers, consistent with the agency’s authority in 12 U.S.C. 10 See OCC Rules Regarding the Availability of OCC Information, 91 FR 50610 (August 5, 2026). 11 91 FR at 10203-04. 12 Specifically, 12 U.S.C. 25b and 1465 respectively address the preemption standards applicable to national banks and Federal savings associations and their subsidiaries.

484. 13 This exclusivity generally prevents other regulators from subjecting these entities to
     additional oversight, which can be unduly burdensome, duplicative, or inconsistent. 14 In addition, based on the exclusivity granted to the OCC, section 4(b) of the Act preempts certain State laws with respect to Federal qualified payment stablecoin issuers.
     Section 5(h) of the GENIUS Act (12 U.S.C. 5904(h)) expressly preempts “any State
     requirement for a charter, license, or other authorization to do business with respect to a Federal qualified payment stablecoin issuer or [a] subsidiary of an [OCC-regulated] insured depository institution … that is approved … to be a permitted payment stablecoin issuer.” As a result, these entities are only required to obtain authorization to do business from the OCC, which reduces the complexity that would result from requiring these entities to also obtain a charter, license, or other authorization from one or more States. 15 Finally, section 7(f)(4) of the GENIUS Act (12 U.S.C. 5906(f)(4)) provides that nothing in the GENIUS Act preempts State consumer protection laws. 16 Together, these GENIUS Act provisions establish a framework for assessing the applicability of State law to a Federal qualified payment stablecoin issuer or a subsidiary of an OCC-regulated insured depository institution approved to be a permitted payment stablecoin issuer. 13 Although the GENIUS Act does not specifically use the term “visitorial powers,” its plain language is consistent with the Supreme Court’s description of visitorial authority. See Cuomo v. Clearing House Ass’n, L.L.C., 557 U.S. 519, 526 (2009) (describing visitation as the exercise of “general supervision”) (emphasis added); see also 12 CFR 7.4000(a)(2) (describing the OCC’s visitorial powers with respect to national banks). 14 Twelve U.S.C. 484 would also continue to apply to uninsured national banks and Federal branches that become permitted payment stablecoin issuers. 15 See also Section 4(b)(1) (12 U.S.C. 5903(b)(1)). 16 Depending on the circumstances, other Federal law, such as the National Bank Act and the Home Owners’ Loan Act, may also be relevant in assessing the applicability of State law, including a State consumer protection law, to certain permitted payment stablecoin issuers, such as uninsured national banks. 17 The GENIUS Act also addresses the applicability of State law to State qualified payment stablecoin issuers. See, e.g., section 7(f) of the Act (12 U.S.C. 5906(f)).

The OCC received several comments on these self-executing provisions. Some commenters requested that the OCC more specifically address whether the GENIUS Act preempts licensing requirements in certain circumstances (e.g., when third parties provide services to certain permitted payment stablecoin issuers, when a foreign payment stablecoin issuer is authorized to issue stablecoins in the U.S., or when a Federal qualified payment stablecoin issuer or subsidiary of an OCC-regulated insured depository institution engages in activities other than those addressed in section 4(a)(7)(A) (12 U.S.C. 5903(a)(7)(A)). Commenters also recommended that the OCC state that it has exclusive visitorial powers over subsidiaries of insured national banks that are permitted payment stablecoin issuers, similar to the proposal’s statement regarding the OCC’s exclusive visitorial powers for Federal qualified payment stablecoin issuers. With respect to State consumer protection laws, commenters had several suggestions, including that the OCC specifically address compliance with applicable State consumer protection laws in its final regulation. Commenters also recommended that the OCC further explain how it will approach certain preemption issues. After carefully considering the comments received, the OCC determined that the issues raised by commenters do not require regulatory changes, are outside the scope of this rulemaking, or are better evaluated on an individualized basis. The section of the preamble to the proposal discussing these self-executing provisions was intended to provide stakeholders with a general understanding of the GENIUS Act’s preemption and visitation framework. Because this framework is self-executing, however, the OCC did not propose any implementing regulation text, nor is it including any in the final rule. While commenters raised several interpretive issues that may warrant clarification at the appropriate time, the OCC has concluded that the agency should retain the flexibility to address such issues as they arise. This will ensure that the OCC’s

analysis is appropriately informed by, and tailored to, the relevant facts and circumstances. Stakeholders may contact the OCC with questions as they arise, and the OCC will provide additional clarification if appropriate. 18 Among other self-executing provisions, section 4(g) of the GENIUS Act (12 U.S.C. 5903(g)) provides that a Federal savings association established under the Home Owners’ Loan Act (12 U.S.C. 1461 et seq.) that holds a reserve that satisfies the requirements of section 4(a)(1) of the GENIUS Act shall not be required to satisfy the qualified thrift lender test under section 10(m) of the Home Owners’ Loan Act (12 U.S.C. 1467a(m)) 19 with respect to such reserve assets. Because this provision is self-executing, the OCC did not propose regulatory text to implement section 4(g). The OCC received no comments on this aspect of the Act and, consistent with the proposal, is not including any regulatory text to implement section 4(g) of the Act.
II. Description of the Final Rule
The final rule, like the proposal, addresses the majority of the OCC’s implementation of the GENIUS Act through new 12 CFR part 15. In addition, like the proposal, the final rule makes updates to 12 CFR parts 3 (Capital Adequacy Standards), 6 (Prompt Corrective Action), 8 (Assessment of Fees), and 19 (Rules of Practice and Procedure). For each subpart, or substantive subsection, of 12 CFR part 15, an overview of the changes from the proposed rule to the final rule is provided, followed by a detailed description of the proposed rule, relevant comments, and final rule. 18 At least one commenter observed that the proposal did not explain how the OCC will comply with 12 U.S.C. 25b, which imposes procedural requirements on certain OCC preemption actions. The OCC has complied, and will continue to comply, with all applicable legal requirements. 19 A Federal savings association is generally required to be a qualified thrift lender. A Federal savings association is a qualified thrift lender if it meets one of the following qualified thrift lender tests: (1) it qualifies as a domestic building and loan association as defined in 26 U.S.C. 7701(a)(19); or (2) its qualified thrift investments equal or exceed 65 percent of its portfolio assets, and its qualified thrift investments continue to equal or exceed 65 percent of its portfolio assets on a monthly average basis in nine out of every 12 months.

A. Subpart A—Purpose, Scope, Definitions, Severability, and Reservation of Authority Consistent with the proposal, subpart A of 12 CFR part 15 provides the purpose and scope and defines terms used throughout the final rule.

1. Overview of Changes from Proposed Rule to Final Rule for Subpart A
   As described below, the OCC is adopting § 15.1, which provides the scope and purpose of part 15, as proposed. The OCC is adopting many of the part 15 definitions in § 15.2 as proposed, but several definitions are being added, removed, or changed. The agency is adopting the following definitions as proposed: affiliate, Bank Secrecy Act, control, deposit, digital asset, director, distributed ledger, executive officer, fair value, FDIC, Federal branch, Federal qualified payment stablecoin issuer, Federal Reserve, foreign payment stablecoin issuer, GAAP, immediate family, insider, insured credit union, insured depository institution, monetary value, money, national currency, nonbank entity, OCC, payment stablecoin, permitted payment stablecoin issuer, person, principal shareholder, publicly available information, registered public accounting firm, related interest, reserve asset, Stablecoin Certification Review Committee, State, State payment stablecoin regulator, and subsidiary. The agency is adding to § 15.2 new definitions for business day, payment stablecoin holder, reserve asset value, sensitive customer information, share account, and tokenized form. Additionally, the agency is removing from § 15.2 the definitions of distributed ledger protocol, State-chartered depository institution, and trading volume. The agency is finalizing the following § 15.2 definitions with differences from the proposed definitions: board of directors, customer, depository institution, eligible financial institution, nonpublic personal information, outstanding issuance value, private key, State qualified payment stablecoin issuer, and United States customer.

As described below, the OCC is adopting § 15.3, providing for the severability of part 15 provisions, as proposed. The OCC is adding § 15.4 on the reservation of authority that was not in the proposed rule.
2. Purpose and Scope (§ 15.1)
Proposed § 15.1 set forth the purpose and scope of the stablecoin-related regulations. Paragraph (a) described the purpose, which is to implement the GENIUS Act, 12 U.S.C. 5901 et seq., with respect to entities for which the OCC is authorized to issue regulations or exercise its enforcement authority under the Act. These entities were listed in the proposed scope provision in paragraph (b), which provided that proposed part 15 would apply to activities related to payment stablecoins and certain custody activities of (1) national banks and their subsidiaries; (2) Federal savings associations and their subsidiaries; (3) Federal branches and their subsidiaries; (4) foreign payment stablecoin issuers; (5) nonbank entities that seek to be or are approved as Federal qualified payment stablecoin issuers; and (6) State qualified payment stablecoin issuers for whom the OCC has regulatory or enforcement authority pursuant to proposed § 15.15 or § 15.16. Thus, except where otherwise noted, references in part 15 to permitted payment stablecoin issuers would only apply to these types of listed entities despite the broader scope of the term in the GENIUS Act. As described in the section-by-section analysis below, proposed subparts B and E would apply to permitted payment stablecoin issuers that are subsidiaries of insured national banks, subsidiaries of Federal savings associations, uninsured national banks, Federal branches or subsidiaries thereof, nonbank entities that are not State qualified payment stablecoin issuers, and State qualified payment stablecoin issuers for which the OCC has regulatory or enforcement

authority. Proposed subpart C would apply to national banks, Federal savings associations, Federal branches, Federal qualified payment stablecoin issuers, and State qualified payment stablecoin issuers with a total consolidated outstanding issuance value of more than $10 billion subject to supervision and regulation by the OCC that provide custodial or safekeeping services for payment stablecoins, reserve assets, and other “covered assets” (described in detail in subpart C). The application and registration sections in proposed subpart D would apply to insured national banks, Federal savings associations, or Federal branches that seek to issue payment stablecoins through a subsidiary; nonbank entities that seek to be Federal qualified payment stablecoin issuers, uninsured national banks, and uninsured Federal branches that seek to be Federal qualified payment stablecoin issuers; and entities that seek to register as foreign payment stablecoin issuers. The capital requirements detailed in proposed subpart E would apply to subsidiaries of insured national banks, subsidiaries of Federal savings associations, uninsured national banks, Federal branches or subsidiaries thereof, nonbank entities that are not State qualified payment stablecoin issuers, and State qualified payment stablecoin issuers for which the OCC has regulatory authority. Several commenters sought greater clarity about which entities would become subject to the proposed regulation because of their activities. These commenters were concerned that a broad scoping of stablecoin issuer activities and digital asset service provider activities might result in an overly broad set of entities becoming subject to the OCC’s regulations, including entities engaged in blockchain infrastructure, technology-service providers, vendor support function providers, and companies that facilitate businesses’ adoption of stablecoin technology. Related to this scope issue, one commenter suggested that the rule should require a standardized certification under Federal oversight for core service providers, which would alter the scope of

entities affected by the rule. Several commenters suggested the OCC follow a regulatory approach based on the activity type and not the institution type. Commenters suggested such an approach increases fair competition and decreases the risk of regulatory arbitrage. The scope of the final rule is consistent with the text of the GENIUS Act and the OCC’s jurisdiction. The OCC’s part 15 applies to national banks and their subsidiaries, Federal savings associations and their subsidiaries, Federal branches and their subsidiaries, foreign payment stablecoin issuers, nonbank entities that seek to be or are approved as Federal qualified payment stablecoin issuers, and State qualified payment stablecoin issuers over which the OCC has regulatory or enforcement authority. To the extent that an entity falls under one of these categories, it is subject to part 15. Otherwise, the entity is not captured by the rule. Therefore, to the extent a blockchain infrastructure or technology service-provider issues a payment stablecoin and is a type of entity subject to the OCC’s jurisdiction, it is covered under part 15. Additionally, entities that are covered custodians as that term is defined in subpart C of part 15 are also subject to part 15. Otherwise, part 15 does not apply. The OCC received no additional comments concerning proposed § 15.1 and is adopting § 15.1, with one technical change. Paragraph (b)(6) of the proposed rule referred to State qualified payment stablecoin issuers for whom the OCC has regulatory or enforcement authority. The final rule replaces “for whom” with “for which.”

3. Definitions (§ 15.2)
   Section 15.2 contains the following definitions of terms used throughout part 15, many of
   which are included in or based on the definitions in the GENIUS Act. 20 A description of the proposed definitions, comments received, and final definitions is below. Acting in concert. The OCC did not propose to define “acting in concert” but requested comment on whether to do so, including whether to incorporate any of the presumptions for acting in concert under 12 CFR 5.50. One commenter stated that the term did not need to be defined. Another recommended defining the term in a manner based on 12 CFR 5.50. Another commenter stated that the definition should not be so broad as to inadvertently capture arm’s￾length commercial relationships between stablecoin issuers and their technology, custody, clearing, or compliance providers. Another commenter recommended adapting the definition in 12 CFR 5.50 to require knowing and purposeful coordination. The definition of “acting in concert” is pertinent to the definition of “principal shareholder,” which, in turn, is relevant to the definition of “insider” and to certain application requirements. The definition of “principal shareholder” is based on the definition in 12 CFR 5.20. The definition of “insider” is based on the definition in Regulation O (12 CFR 215). Both 12 CFR 5.20 and Regulation O use the terms “acting in concert” or “acting through or in concert” but do not define the terms. After considering the comments received, the OCC has concluded that it is unnecessary to define the term for purposes of 12 CFR part 15 because the term would serve the same purpose as in 12 CFR 5.20 and Regulation O, and the existing regulations are well established and understood. While the OCC is not defining the term for purposes of 12 CFR part 15, the OCC expects that 20 The definitions in § 15.2 describe only terms used in part 15. These definitions do not interpret terms for purposes of any other statute or regulation and are not issued pursuant to section 3(d) of the GENIUS Act (12 U.S.C. 5902(d)).

any person that would be deemed to be acting in concert for purposes of 12 CFR 5.50 would also be acting in concert for purposes of § 15.14(m), which applies the requirements of 12 CFR 5.50 in the context of permitted payment stablecoin issuers. Because the term “acting in concert” serves a different purpose in 12 CFR part 15 than in 12 CFR 5.50, the OCC has not, however, incorporated the definition in 12 CFR 5.50 or incorporated any of the presumptions therein. Affiliate. The OCC proposed to define the term “affiliate” consistent with the definition in the Bank Holding Company Act, 12 U.S.C. 1841(k), but modified to use the defined term “person” in place of the term “company.” Under the proposed rule, the term “affiliate” would have meant a person that controls, is controlled by, or is under common control with another person. Commenters generally supported or did not opine on the definition of “affiliate” (but, as discussed below, the OCC did receive comments concerning the definition of control, which has implications for the definition of affiliate). The OCC is adopting the definition of affiliate as proposed. This approach aligns the definition with the definition in the Bank Holding Company Act with which market participants are generally familiar. As discussed in the proposal, the definition of “affiliate” is consistent with the definition in the Bank Holding Company Act, and the OCC generally expects that it will interpret questions regarding the definition of “affiliate” consistent with the provisions of 12 CFR part 225 as of the date of the issuance of this final rule. Bank Secrecy Act. The OCC proposed to define the term “Bank Secrecy Act” consistent with the definition provided in the GENIUS Act, 12 U.S.C. 5901(2). Under the proposal, the term “Bank Secrecy Act” would have meant: (1) section 21 of the Federal Deposit Insurance Act (12 U.S.C. 1829b); (2) chapter 2 of title I of Public Law 91–508 (12 U.S.C. 1951 et seq.); and (3)

subchapter II of chapter 53 of title 31, United States Code and notes thereto (31 U.S.C. 5311 et seq.). The proposal added the phrase “and notes thereto” as a clarification. The OCC received no comments addressing the definition of “Bank Secrecy Act.” The OCC is adopting the definition as proposed. Board of directors. Under the proposed rule, “board of directors” would have meant a permitted payment stablecoin issuer’s or applicant’s board of directors or the group of individuals that serve the nearest equivalent function of acting as the governing body of the issuer or applicant. The proposed definition captured the persons responsible for certain requirements under proposed part 15, including for permitted payment stablecoin issuers that do not have a board of directors as that term is commonly understood. The OCC received no comments addressing the definition of “board of directors.” The OCC is adopting the definition with one technical change replacing “serve” with “serves.” Business day. One commenter requested that the OCC clarify the meaning of “business day,” including whether Saturdays, Sundays, and national holidays are excluded, for purposes of the timely redemption requirement in § 15.12. Alternatively, the commenter stated that the OCC could impose a requirement that issuers disclose how they calculate the two-business-day period under § 15.12. To provide clarity, the OCC is defining “business day” to mean any day other than a Saturday, Sunday, or Federal holiday. Conspicuous. One commenter requested that the OCC define “conspicuous” for purposes of relevant disclosures. The OCC declines to do so in this final rule because whether disclosures are conspicuous depends heavily on context. The OCC generally expects that disclosures that

would be considered conspicuous under 12 CFR part 328 would generally be considered conspicuous under 12 CFR part 15. Control. The OCC proposed to define “control” such that a person would have controlled another person if: (1) the person directly or indirectly or acting through one or more other persons owns, controls, or has power to vote 25 percent or more of any class of voting securities of the other person; (2) the person controls in any manner the election of a majority of the directors or trustees of the other person; or (3) the OCC determines, after notice and opportunity for hearing, that the person directly or indirectly exercises a controlling influence over the management or policies of the other person. Like the definition of “affiliate,” the proposed definition of “control” was generally consistent with the Bank Holding Company Act. The OCC noted that proposed § 15.14 included certain provisions regarding changes in control that would refer to the use of that term under 12 CFR 5.50, rather than under the Bank Holding Company Act. Thus, for purposes of those provisions, permitted payment stablecoin issuers would refer to 12 CFR 5.50. The OCC received several comments addressing the definition of “control.” Several commenters requested that the OCC clarify the definition of control, including by expressly incorporating the presumptions of control in the Bank Holding Company Act and the Federal Reserve’s Regulation Y. Other commenters argued for narrowing the definition of control by providing that “controlling influence” should be assessed based on actual decision-making authority and economic control, rather than formal or theoretical influence. One commenter advocated for a blend of Bank Holding Company Act and Change in Bank Control Act concepts. Some stated that a framework based on the Bank Holding Company Act is useful but should be adapted or clarified. Some commenters advocated for a narrower definition and for assessing

controlling influence based on actual economic and legal control, rather than theoretical influence. Another stated that control encompasses not only ownership and voting power, but also the ability to direct or materially influence governance, operational decision-making, or risk￾bearing functions, whether exercised directly or indirectly. After considering the comments received, the OCC is adopting the definition as proposed. This approach aligns with the definition in the Bank Holding Company Act, with which market participants are generally familiar. Consistent with a statement in the proposal, the OCC generally expects that it will interpret questions regarding the definition of “control” consistent with the provisions of 12 CFR part 225, including those relating to controlling influences and to the presumption of control, as of the date of the issuance of this final rule. The interpretations of control under the Bank Holding Company Act, including 12 CFR part 225, generally have been developed after consideration of the same or similar comments received in response to the proposal. Moreover, the OCC may provide additional clarity through guidance and interpretations, as necessary. The OCC believes that this approach will provide clarity to market participants. Customer. The OCC proposed to define the term “customer” to mean a person that purchases (through any consideration) the products or services of another person. Among other provisions, the definition of “customer” was relevant to certain information protection and notification requirements. The OCC received several comments addressing the definition of “customer.” Several commenters regarded the proposed definition of “customer” as overly broad because it could capture indirect relationships between stablecoin holders and permitted payment stablecoin

issuers. These commenters generally argued in favor of requiring a contractual relationship between a permitted payment stablecoin issuer and a counterparty for the counterparty to be covered by the definition of customer. Other commenters generally favored a broad definition that would include persons who acquired payment stablecoins in the secondary market. One commenter advocated not defining the term. The final rule modifies the definition by defining customer (except in the context of the custody provisions, where the term “covered customer” is used) to mean a person that purchases (through any consideration) the products or services of a permitted payment stablecoin issuer or foreign payment stablecoin issuer directly from the issuer or that makes a request directly to the issuer that the issuer convert, redeem, or repurchase a payment stablecoin. This definition focuses on the relationship between the issuer and its direct counterparties. Thus, for example, if a payment stablecoin holder acquired its payment stablecoin from a third-party distributor (including a distributor that is associated with the payment stablecoin, for example, as part of a white-label arrangement) that did not act as agent for the permitted payment stablecoin issuer, the payment stablecoin holder would not be a customer of the permitted payment stablecoin issuer unless and until the holder sought to redeem the payment stablecoin from the permitted payment stablecoin issuer (or otherwise purchased products or services directly from the permitted payment stablecoin issuer). The OCC believes that this narrower definition is appropriate in light of additional changes, described below, including adopting a definition of “payment stablecoin holder” and clarifying how certain notification requirements in the final rule apply to customers. The OCC believes that these changes will help ensure that the term is neither overly broad nor overly narrow. The OCC believes that this revised definition will result in a set of customers that is

easily identifiable by permitted payment stablecoin issuers. This definition does not affect the definition of customer for purposes of other laws and regulations, including privacy laws and the Bank Secrecy Act and its implementing regulations. Deposit. The OCC proposed to define the term “deposit” to have the same meaning as deposit in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813(l)). The OCC received no comments addressing the definition of “deposit.” The OCC is adopting the definition as proposed. Depository institution. The OCC proposed to define the term “depository institution” to mean a depository institution as that term is defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813(c)(1)) or a credit union. The OCC proposed this definition because, although the GENIUS Act uses the term “depository institution,” it is not defined in section 2 of the Act (12 U.S.C. 5901). Section 11(g) of the Act (12 U.S.C. 5910(g)) does, however, refer to the Federal Deposit Insurance Act’s definition. 22 Under the Federal Deposit Insurance Act, the term “depository institution” means any bank or savings association, both of which are defined terms under that statute and would be incorporated to determine whether an institution is a depository institution for purposes of proposed part 15. The OCC also proposed to include a reference to credit unions consistent with the approach that the GENIUS Act took with respect to the definition of “insured depository institution,” defined below, and which explicitly includes insured credit unions. This term is particularly relevant with respect to the OCC’s jurisdiction 21 See generally 91 FR 37840; Permitted Payment Stablecoin Issuer Customer Identification Program, 91 FR 37234 (June 22, 2026). 22 The proposed definition of “depository institution” for purposes of part 15 would not affect the meaning of the term under section 11(g) of the GENIUS Act (12 U.S.C. 5911).

over certain nonbank entities under sections 2(25), 4(d), and 7(e) of the Act (12 U.S.C. 5901(25), 5903(d), and 5906(e)). The OCC received several comments addressing the definition of “depository institution.” Some commenters stated that privately insured credit unions should be excluded from the definition so that they could apply to be Federal qualified payment stablecoin issuers. One commenter suggested that the OCC clarify whether “depository institution” refers strictly to FDIC-insured institutions or extends to other charter types with deposit-like authorities. One commenter suggested that the OCC should make clear that the term “depository institution” also includes the uninsured State branches of foreign banks. The final rule includes certain modifications to the definition. Under the final rule, the term “depository institution” would mean a depository institution, as that term is defined in
section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813(c)(1)), or an insured credit union
as defined in section 101 of the Federal Credit Union Act (12 U.S.C. 1752) (i.e., a credit union that is not an insured credit union under section 101 of the Federal Credit Union Act would not be included in the definition of depository institution). Absent this change, there could have been ambiguity as to which agency is the primary Federal payment stablecoin regulator for a non￾Federally insured credit union. Such a credit union would not meet the definition of “State depository institution” under section 2(29) of the GENIUS Act (12 U.S.C. 5901(29)) but, if the credit union were a depository institution, it would not be a nonbank entity. In other words, the proposed definition could have the effect of excluding non-Federally insured credit unions from being regulated by the OCC as permitted payment stablecoin issuers. The amended definition makes clear that a non-Federally insured credit union is a nonbank entity and that the OCC is the

primary Federal payment stablecoin regulator for such entities. In response to other comments, the OCC does not believe that it is appropriate to limit the definition of “depository institution” strictly to insured depository institutions. The statute uses both terms, and it is appropriate to regard each term as having a separate meaning. In light of the GENIUS Act’s frequent references to the Federal Deposit Insurance Act, the most faithful reading of the statute would incorporate the Federal Deposit Insurance Act’s definition, with the modification described above to address the fact that the GENIUS Act addresses credit unions while the Federal Deposit Insurance Act does not. Thus, institutions that are depository institutions under the Federal Deposit Insurance Act (i.e., national banks, savings associations, State banks, Federal branches, and insured branches) would be depository institutions for purposes of 12 CFR part 15. The OCC further notes that “insured depository institution” is defined separately (discussed below). Digital asset. The OCC proposed to define the term “digital asset” as provided in section 2(6) of the GENIUS Act (12 U.S.C. 5901(6)). Under the proposed rule, the term “digital asset” would have meant any digital representation of value that is recorded on a cryptographically secured distributed ledger. The OCC received several comments addressing the definition of “digital asset.” Several commenters supported the proposed definition but asked the OCC to clarify that application of this definition within the proposed rule remains limited to the activities and obligations expressly contemplated by the GENIUS Act. Some commenters suggested that the OCC ensure that the definition clearly distinguishes between (i) payment stablecoins covered by the rule, (ii) tokenized deposits and certain other bank liabilities, and (iii) digital representations of traditional financial assets that do not function as standalone mediums of exchange. One commenter stated

that the definition does not cover non-fungible loyalty points, to the extent they are not recorded on a cryptographically secured distributed ledger. The OCC is adopting the definition as proposed. The regulatory definition matches the statutory definition. In response to comments, other definitions, including the definition of “payment stablecoin,” appropriately distinguish different types of digital assets from one another. The definition of “payment stablecoin” distinguishes a payment stablecoin from a deposit, including a tokenized deposit, without any need to revise the broader definition of “digital asset.” In addition, the OCC confirms that the definition applies for purposes of implementing the GENIUS Act under part 15 and does not necessarily apply in other contexts. The OCC also confirms that, under the definition in part 15, a representation of value that is not recorded on a cryptographically secured distributed ledger is not a digital asset. Digital asset service provider. The proposed rule did not include the term “digital asset service provider” but sought comment on whether to include such a term. The OCC received several comments on the term. Many of these comments sought clarifications around the scope of the term. Some sought to distinguish digital asset service providers from permitted payment stablecoin issuers. Others requested that the OCC clarify that the term does not include providers of blockchain infrastructure or DeFi activities. Others stated that the statutory definition was sufficiently clear or that the OCC had no authority to interpret the term. The final rule, like the proposal, does not use the term, which is generally more relevant to section 3 of the GENIUS Act (12 U.S.C. 5902) than the sections that part 15 implements. The OCC therefore found it unnecessary to define the term for purposes of part 15. The OCC does note that certain provisions of the GENIUS Act (e.g., 12 U.S.C. 5902) apply to digital asset

service providers and that permitted payment stablecoin issuers may also be considered digital asset service providers. Accordingly, permitted payment stablecoin issuers should ensure compliance both with the rules that apply to permitted payment stablecoin issuers and the rules that apply to digital asset service providers, as applicable. 23 Director. The OCC proposed to define the term “director” for purposes of proposed part 15 to mean an individual who serves on the board of directors of a permitted payment stablecoin issuer or applicant, except an advisory director who does not have the authority to vote on matters before the board of directors or any committee of the board of directors and provides solely general policy advice to the board of directors or any committee. The OCC based the proposed definition on the definition included in 12 CFR 5.51. The proposed definition was modified from that in 12 CFR 5.51 to remove the exclusion for a director of a foreign bank that operates a Federal branch. The OCC determined that this language was unnecessary in light of the proposed definition of the term “board of directors.” As described above, to address the various organizational forms used by permitted payment stablecoin issuers and applicants, including those that do not have a traditional board of directors, the OCC proposed to define the term “board of directors” in proposed part 15 to include a group of individuals that serve the nearest equivalent function of acting as the governing body of the issuer or applicant. For a Federal branch, individuals who would meet the proposed definition of “director” would include individuals that are part of that group. Further, a director of a foreign bank is not a director of the branch unless the director serves on the board of a Federal branch (or serves in an equivalent capacity with respect to the branch). 23 See Department of the Treasury, GENIUS Act Regulations on Payment Stablecoin Issuance, Offer, and Sale, 91 FR 53368, 53371 (August 18, 2026) (stating that permitted payment stablecoin issuers are also digital asset service providers under the GENIUS Act).

The OCC received a few comments addressing the definition of “director.” A commenter suggested that: (i) branch-level senior officers should not automatically be considered “directors” solely because they exercise local management authority and (ii) for Federal branches seeking to issue stablecoins through a subsidiary, “director” should mean members of the subsidiary’s board with binding governance authority, not the branch’s country officer or regional manager. The OCC is adopting the definition as proposed. The OCC believes the proposed definition was appropriately scoped in light of the definition of “board of directors,” which includes the group of individuals that serves the nearest equivalent function of acting as the governing body of the issuer or applicant. This definition focuses on persons with actual authority with respect to an entity. This functional definition of “director” appropriately captures persons serving the actual governance function associated with serving on the board of directors, regardless of formal structure or title. Distributed ledger. The OCC proposed to define the term “distributed ledger” as provided in the GENIUS Act, 12 U.S.C. 5901(8), with certain technical edits. The proposed rule defined the term “distributed ledger” to mean technology in which (1) data is shared across a network that creates a public digital ledger of verified transactions or information among network participants and (2) cryptography is used to link the data to maintain the integrity of the public ledger and execute other functions. The proposed definition reformatted the definition in the GENIUS Act by using numbering to distinguish between the two components of the definition. The formatting changes were technical and did not substantively affect the definition. 24 The commenter also stated that independent directors required for audit and risk committees should not need to be United States citizens but must be subject to United States jurisdiction for enforcement purposes. The OCC confirms that a director need not be a United States citizen but is subject to the enforcement provisions of the GENIUS Act.

The OCC received several comments addressing the definition of “distributed ledger.” Commenters generally supported the proposed definition but suggested making clarifications or including definitions of additional terms. For example, commenters had varying views on whether the term should include or exclude public ledgers, private ledgers, or semi-private ledgers. The OCC is adopting the definition as proposed. This approach aligns with the statute. The OCC may address future innovations and developments through interpretations or additional rulemaking, as appropriate. Distributed ledger protocol. The OCC proposed to define the term “distributed ledger protocol” as provided in the GENIUS Act, 12 U.S.C. 5901(9). The term “distributed ledger protocol” would have meant publicly available and accessible executable software deployed to a distributed ledger, including smart contracts or networks of smart contracts. The OCC received no comments separately addressing the definition of “distributed ledger protocol.” The final rule, however, does not use the term. Accordingly, the OCC is not including a definition of the term in the final rule. Eligible financial institution. The OCC proposed to define “eligible financial institution” to mean (1) a person that (a) is eligible to hold reserve assets in custody under section 10(a) of the GENIUS Act (12 U.S.C. 5909(a)); (b) complies with the applicable requirements in section 10(b), (c), and (d) of the GENIUS Act (12 U.S.C. 5909(b), (c) and (d)), including with applicable implementing regulations issued by a relevant primary Federal payment stablecoin regulator as defined in 12 U.S.C. 5901(25), primary financial regulatory agency described in 12 U.S.C. 5301(12)(B) or (C), State bank supervisor, or State credit union supervisor; and (c), if applicable,

enters into a custody agreement with a permitted payment stablecoin issuer documenting the person’s compliance with paragraph (2) of the definition of eligible financial institution; or (2) a Federal Reserve Bank. The term “eligible financial institution” is relevant to the reserve asset diversification and concentration requirements in § 15.11(c) of the rule. Under section 10(a) of the GENIUS Act (12 U.S.C. 5909(a)), a person may only engage in the business of providing custodial or safekeeping services for the payment stablecoin reserve, the payment stablecoins used as collateral, or the private keys used to issue payment stablecoins if the person meets certain requirements, including being subject to supervision or regulation by a primary Federal payment stablecoin regulator, primary financial regulatory agency, or supervision by a State bank supervisor or a State credit union supervisor if such State bank supervisor or State credit union supervisor makes available to the Federal Reserve certain information. Such a person must also comply with the requirements under section 10(b) of the GENIUS Act (12 U.S.C. 5909(b)), unless the person holds such property in accordance with similar requirements as required by a primary Federal payment stablecoin regulator, the Securities and Exchange Commission, or the Commodity Futures Trading Commission. Eligible financial institutions would have included insured depository institutions and national banks regardless of whether the entities engaged in stablecoin activities or provided custody services to permitted payment stablecoin issuers because these entities are subject to supervision or regulation by a primary Federal payment stablecoin regulator. Thus, for example, under proposed § 15.11(c) a permitted payment stablecoin issuer could hold reserves as deposits at a national bank regardless of whether the national bank acted as custodian for the permitted payment stablecoin issuer’s other reserve assets.

To meet the proposed definition, a financial institution would have also needed to comply with the applicable requirements of section 10 of the Act (12 U.S.C. 5909), and the relevant custody agreement would have needed to reflect compliance with section 10 as well as policies and procedures to ensure such compliance. 25 These criteria help ensure compliance with section 10 of the Act. The OCC recognized that multiple agencies will regulate permitted payment stablecoin issuers and the entities that may permissibly custody reserve assets. The proposed rule would have imposed requirements on where and how OCC-regulated permitted payment stablecoin issuers may hold reserve assets in § 15.11. Proposed subpart C would have separately imposed the requirements of section 10 of the GENIUS Act (12 U.S.C. 5909) on OCC-regulated institutions that hold reserve assets on behalf of payment stablecoin issuers, including on behalf of payment stablecoin issuers not regulated by the OCC. Proposed § 15.11 did not mandate that OCC-regulated permitted payment stablecoin issuers only hold their reserve assets in the custody of OCC-regulated custodians. Accordingly, the proposal acknowledged that there could be overlap between the requirements imposed by different regulators with different requirements implementing section 10 of the GENIUS Act. The OCC invited comment on the best ways to manage potentially overlapping requirements. The proposed rule would have required that an “eligible financial institution” comply with the requirements in section 10(b), (c), and (d) of the GENIUS Act, including applicable implementing regulations. Accordingly, even if different types of eligible financial institutions were subject to different regulations on the safe handling of stablecoin reserve assets, an OCC-regulated permitted payment stablecoin issuer could still 25 As discussed above, to the extent that an eligible financial institution does not engage in custody of covered assets, section 10 of the GENIUS Act (12 U.S.C. 5909) would not apply.

custody reserve assets at any entity that met the requirements in the definition of “eligible financial institution.” The proposed rule would have required a permitted payment stablecoin issuer to enter into a custody agreement with an eligible financial institution, which would have required that the eligible financial institution adhere to the requirements in section 10(b), (c), and (d), along with any applicable implementing regulations. This requirement would have helped ensure that the eligible financial institution knows that it is subject to the requirements of the GENIUS Act and would have provided permitted payment stablecoin issuers a contractual means of enforcing compliance with applicable provisions of the Act. The OCC received several comments addressing the definition of “eligible financial institution.” Commenters generally supported the proposed definition but made suggestions that the OCC make certain clarifications. One commenter suggested publishing and maintaining a list of institution types that qualify as eligible financial institutions, rather than leaving payment stablecoin holders to determine what may be an eligible financial institution. The OCC will not provide a list of eligible financial institutions or eligible financial institution types as that list may become stale as new types of entities become eligible to hold reserve assets in custody under section 10 of the Act (12 U.S.C. 5909) and it would be resource-intensive for the OCC to identify all eligible financial institutions regulated by different States. Rather than updating the list every time a new entity type becomes eligible, the OCC believes that a definition that relates back to the statutory requirements in section 10 (12 U.S.C. 5909) is appropriate. One commenter suggested that the OCC confirm the eligibility of foreign branches and agencies as eligible financial institutions for reserve custody purposes. The OCC confirms that

foreign branches and agencies may hold reserve assets in custody, provided that they meet the requirements in section 10 of the GENIUS Act (12 U.S.C. 5909). However, as discussed below, deposit liabilities of institutions that are not insured depository institutions do not qualify as reserve assets under section 4(a)(1)(A)(ii) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)(ii)). 26 To be clear, section 10 of the Act (12 U.S.C. 5909) would not apply to a foreign custodian holding payment stablecoin reserves where there is no nexus to the United States. This approach ensures that the Act does not have an overly broad extraterritorial effect. However, holding payment stablecoin reserves for a permitted payment stablecoin issuer is clearly within the scope of section 10 of the Act (12 U.S.C. 5909). Moreover, because the definition of permitted payment stablecoin issuer is limited to persons formed in the United States, holding reserve assets for such persons entails a clear nexus to the United States. A few commenters stated that eligibility should be based more on the activities performed and the institution’s ability to satisfy segregation, custody, and operational standards than on balance sheet size or charter type, so that institutions of varying sizes and charter types can participate if they meet the relevant standards. The OCC’s proposed definition would not have been inconsistent with these comments. The proposed definition did not impose any limitations for eligible financial institutions based on size. Moreover, the proposed rule did not limit eligible financial institutions to any particular charter type. Rather, the proposed rule imported the requirement in section 10 of the Act (12 U.S.C. 5909) that the institution be subject to supervision by certain State or Federal regulators. 26 Uninsured deposits of insured banks are, however, permissible reserve assets under section 4(a)(1)(ii) of the GENIUS Act (12 U.S.C. 5903(a)(1)(ii)).

Another commenter suggested that the OCC align the definition with established statutory and regulatory frameworks, such as the Bank Holding Company Act and State money transmitter laws, to promote consistency and reduce ambiguity. The OCC does not believe that further alignment is necessary or appropriate. Section 10 of the Act (12 U.S.C. 5909) sets forth the supervisory framework that applies to custodians of reserve assets, and the proposed rule merely ensures that such custodians comply with section 10. Any further changes to the definition could result in narrowing or broadening the types of institutions that may hold reserve assets in custody in a manner inconsistent with the statute. One commenter stated that the definition of “eligible financial institution” should not be conditioned on complying with sections 10(b), (c), and (d) of the GENIUS Act (12 U.S.C. 5909(b)-(d)). The OCC disagrees. Sections 10(b), (c), and (d) each cross-reference to persons described in section 10(a) of the Act (12 U.S.C. 5909(a)). Thus, a person that is eligible to hold payment stablecoin reserve assets in custody under section 10(a) (12 U.S.C. 5909(a)) is subject to the requirements of sections 10(b), (c), and (d) of the Act, as applicable. The OCC is adopting the definition, with technical changes. The final rule renumbers paragraphs (1)(a) through (c) as (1)(i) through (iii) and replaces in paragraph (iii) a reference to paragraph (2) with a reference to paragraph (1)(ii). The final rule also includes additional clarifying language stating that a person must have in place policies and procedures designed to ensure compliance with paragraph (ii) (whereas the proposal referred to policies and procedures without explicit language clarifying that the person must have such policies and procedures in 27 Under section 10(a)(2) of the Act, 12 U.S.C. 5909(a)(2), a custodian of reserve assets must comply with the requirements of section 10(b) of the Act unless the custodian holds the reserve assets (or other covered assets) in accordance with similar requirements as required by a primary Federal payment stablecoin regulator, the Securities and Exchange Commission, or the Commodity Futures Trading Commission.

place). The definition appropriately encompasses the institutions that may hold reserve assets under section 10 of the GENIUS Act (12 U.S.C. 5909). Excessive. The OCC received a few comments recommending the OCC define “excessive” both for purposes of affiliate transactions and for purposes of relevant capital requirements. The OCC is not adding a definition of “excessive” because the final rule does not use the term. The OCC has revised the provisions of the rule that used the word “excessive” in the proposal to provide additional clarity. Executive officer. The OCC proposed a definition for the term “executive officer,” which is used in connection with the proposed application process in § 15.30. Under the proposal, the term “executive officer” would have been defined to mean the president, chairman, chief executive officer, chief operating officer, chief financial officer, chief investment officer, chief risk officer, chief technology officer, and Bank Secrecy Act officer. The term would have included any individual serving in the functional capacity of the listed titles or their equivalent, without regard to title, salary, or compensation. The OCC based the proposed “executive officer” definition on the definition of “Senior executive officer” in 12 CFR 5.51(c)(4) with certain modifications to conform the language and format to apply to the relevant individuals and entities under this part and to streamline the definition to the positions most likely to be relevant for permitted payment stablecoin issuers. The OCC received no comments addressing the definition of “executive officer.” The OCC is adopting the definition as proposed. Fair value. The OCC proposed to include a definition of the term “fair value” in the rule. As proposed, the term “fair value” would mean the fair value as determined under GAAP. 28 Fair 28 See discussion of the definition of “GAAP,” infra.

value is used in the definition of “reserve asset value,” which pertains to the reserve asset requirements in § 15.11. The OCC received no comments addressing the definition of “fair value.” The OCC is adopting the definition as proposed. FDIC. The OCC proposed to define FDIC to mean the Federal Deposit Insurance Corporation. This accords with the definition of “Corporation” in section 2(5) of the GENIUS Act (12 U.S.C. 5901(5)). The OCC opted not to use the term “Corporation” to describe the FDIC because that term is used more broadly in the definition of person, discussed below. The OCC received no comments addressing the definition of “FDIC.” The OCC is adopting the definition as proposed. Federal branch. The OCC proposed to define the term “Federal branch” as provided in the GENIUS Act, 12 U.S.C. 5901(10). Specifically, the proposed rule provided that the term “Federal branch” would have the meaning set forth in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813(s)(2)). The OCC received no comments addressing the definition of “Federal branch.” The OCC is adopting the definition as proposed. Federal qualified payment stablecoin issuer. The OCC proposed to define the term “Federal qualified payment stablecoin issuer” consistent with the definition of that term in the GENIUS Act, 12 U.S.C. 5901(11), with certain technical and conforming changes. Specifically, the proposed rule defined the term “Federal qualified payment stablecoin issuer” to mean the following entities that are approved by the OCC, pursuant to proposed § 15.30, to issue payment stablecoins: (1) a nonbank entity, other than a State qualified payment stablecoin issuer; (2) an uninsured national bank that is chartered by the OCC, pursuant to title LXII of the Revised

Statutes; or (3) a Federal branch. 29 The proposed definition modified the definition provided in the GENIUS Act by reformatting it to reduce repetition and replacing the statutory term “Comptroller” with the proposed defined term “OCC.” In addition, the proposed definition replaced cross references to section 5 of the GENIUS Act (12 U.S.C. 5904) with a cross reference to the proposed implementing provisions in proposed § 15.30. The OCC received no comments addressing the definition of “Federal qualified payment stablecoin issuer.” The OCC is adopting the definition as proposed. Federal Reserve. The proposed rule defined the term “Federal Reserve” to mean the Board of Governors of the Federal Reserve System. This accords with the definition of “Board” in section 2(3) of the GENIUS Act (12 U.S.C. 5901(3)). The OCC proposed to use the term “Federal Reserve” in place of “Board” for greater clarity because the proposed rule refers separately to boards of directors in various sections. The OCC received no comments addressing the definition of “Federal Reserve.” The OCC is adopting the definition as proposed. Foreign payment stablecoin issuer. The OCC proposed to define the term “foreign payment stablecoin issuer” consistent with the definition of that term in the GENIUS Act, 12 U.S.C. 5901(12), with certain clarifying changes. Under the proposed rule, the term “foreign payment stablecoin issuer” would have meant an issuer of a payment stablecoin that is (1) organized under the laws of or domiciled in a foreign country or a territory of the United States; and (2) not a permitted payment stablecoin issuer as defined in 12 U.S.C. 5901(23). The proposed definition of foreign payment stablecoin issuer referred to the statutory definition of 29 Certain Federal qualified payment stablecoin issuers may be subsidiaries of national banks. For example, an uninsured national trust bank may be a subsidiary of a national bank. An insured national bank or Federal savings association seeking to issue a payment stablecoin would, however, need to do so through a subsidiary, as required under the GENIUS Act. See 12 U.S.C. 5901(23) (defining “permitted payment stablecoin issuer”).

“permitted payment stablecoin issuer” because the proposed rule generally limits the definition of that term to entities subject to the OCC’s jurisdiction. Although included in the statutory definition, the proposed definition did not include the phrase “Puerto Rico, Guam, American Samoa, or the Virgin Islands.” The OCC determined that the omitted phrase was redundant and may lead to confusion. Under the proposed definition, a foreign payment stablecoin issuer may be organized under the laws of, or domiciled in. any territory of the United States. The United States currently has five permanently inhabited territories: the four listed above and the Northern Mariana Islands. The OCC received no comments addressing the definition of “foreign payment stablecoin issuer.” The OCC is adopting the definition as proposed with a technical modification to add commas. Freeze and seize. The OCC received one comment stating that the OCC should separately define “freeze” and “seize.” The final rule does not use these terms. Therefore, the OCC has elected not to define them. To the extent they are used in the forthcoming rule considering BSA/AML and sanctions, the OCC may consider defining these terms. GAAP. The OCC proposed to include a definition of the term GAAP in the rule. The proposed rule defined the term “GAAP” to mean generally accepted accounting principles as used in the United States. GAAP is used in the definition of fair value and proposed subparts B and E. The OCC received no comments addressing the definition of “GAAP.” The OCC is adopting the definition as proposed. Immediate family. The OCC proposed to define the term “immediate family” to mean the spouse of an individual, the individual’s minor children, and any of the individual’s children (including adults) residing in the individual’s home. This term is relevant to the risk management

standards concerning insider and affiliate transactions and is consistent with the definition in Regulation O (12 CFR part 215). The OCC received no comments addressing the definition of “immediate family.” The OCC is adopting the definition as proposed. Insider. The OCC proposed to define the term “insider” to mean a principal shareholder, an executive officer, a director, or a related interest of, or the immediate family member of, any of these persons. This term is relevant to the risk management standards concerning insider and affiliate transactions and is adapted from the definition in Regulation O (12 CFR part 215). The term was adapted to make direct reference to the immediate family of a principal shareholder, executive officer, or director to mitigate the risk of an insider engaging in inappropriate transactions to benefit immediate family members. The OCC received no comments addressing the definition of “insider.” The OCC is adopting the definition as proposed with a technical modification to add commas. Insured credit union. The OCC proposed to define the term “insured credit union” consistent with the definition of the term in the GENIUS Act, 12 U.S.C. 5901(14). As proposed, the term “insured credit union” would have the meaning given to that term in section 101 of the Federal Credit Union Act (12 U.S.C. 1752). The OCC received no comments addressing the definition of “insured credit union.” The OCC is adopting the definition as proposed. Insured depository institution. The OCC proposed to define the term “insured depository institution” consistent with the definition of the term in the GENIUS Act, 12 U.S.C. 5901(15). As proposed, the term “insured depository institution” would have been defined to mean an insured depository institution, as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813(c)(2)) and an insured credit union.

The OCC received a number of comments addressing the definition of “insured depository institution.” Some commenters stated that the OCC should define “insured depository institution” by reference to section 3(c)(3) of the Federal Deposit Insurance Act rather than the generally applicable definition in section 3(c)(2) of the same Act. Commenters stated that excluding uninsured branches from the definition distorts markets and contradicts the GENIUS Act’s intent to decouple payment stablecoins from deposit insurance and to promote competitive equity among United States banks and foreign banks and would be inconsistent with generally applicable principles of national treatment. Commenters also stated that using the broader definition in section 3(c)(3) of the Federal Deposit Insurance Act would be consistent with longstanding principles concerning national treatment. Commenters stated that the term “insured depository institution” should not depend on actual FDIC insurance coverage (per section 3(c)(2) of the Federal Deposit Insurance Act) but rather on comprehensive regulation and enforcement (per section 3(c)(3) of the Federal Deposit Insurance Act). A few commenters stated that legislative history supports treating foreign banking organizations the same as United States banks and indicates that reserve demand deposits need not be insured so long as they are held at regulated institutions. Some commenters pointed to prior Federal Reserve interpretations under
section 716 of the Dodd-Frank Act as support for reading ambiguous statutory language to
include branches and agencies of foreign banks. One commenter also stated that, while reserve balances generally should be held onshore to support onshore redemption, issuers should be able to hold a portion of reserves offshore to facilitate minting and burning for non-U.S. holders outside United States banking hours. Another commenter argued that using the broader definition would be consistent with the goals of the statute and would not create undue risk given the applicable prudential regulations.

The OCC is adopting the definition as proposed. Under section 3(c)(2) of the Federal Deposit Insurance Act, “insured depository institution” means any bank or savings association the deposits of which are insured by the FDIC. This is the definition that generally applies under the Federal Deposit Insurance Act. Section 3(c)(3) provides that the term “insured depository institution” also includes any uninsured branch or agency of a foreign bank or a commercial lending company owned or controlled by a foreign bank for purposes of 12 U.S.C. 1818. As this provision is clearly limited to section 8 of the Federal Deposit Insurance Act, it would not be a permissible interpretation of the Act to extend the provision beyond section 8 of the Federal Deposit Insurance Act. Therefore, uninsured branches and agencies of foreign banks or commercial lending companies owned or controlled by foreign banks are not insured depository institutions under the Act based on a plain reading of the Act. Because the statute is clear that uninsured branches and agencies of foreign banks are not insured depository institutions, the OCC is not amending the definition. Monetary value. The OCC proposed to define the term “monetary value” as provided in the GENIUS Act, 12 U.S.C. 5901(17). The proposal defined “monetary value” to mean a national currency or deposit (which, as discussed above, would have the same meaning as in
section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813(l)) denominated in a national
currency. The OCC received no comments addressing the definition of “monetary value.” The OCC is adopting the definition as proposed. Money. Section 2(18) of the GENIUS Act, 12 U.S.C. 5901(18), defines “money” to mean a medium of exchange currently authorized or adopted by a domestic or foreign government, including a monetary unit of account established by an intergovernmental organization or by agreement between two or more countries. This definition is relevant to the definition of national

currency (discussed below) and certain reserve assets described in section 4(a)(1)(A)(i) and (iv) of the Act (12 U.S.C. 5903(a)(1)(A)(i) and (iv)). Section 4(a)(1)(A)(i) refers to money standing to the credit of an account with a Federal Reserve Bank. Section 4(a)(1)(A)(iv) refers to money received under a repurchase agreement that meets certain requirements. Although the statutory definition of money clearly includes monetary value, it may be unclear at any point in time whether other mediums of exchange have been authorized or adopted by a domestic or foreign government. Moreover, whether a medium of exchange meets this definition may change based on actions of foreign governments or intergovernmental organizations. While it may be relatively clear whether an asset is money standing to the credit of an account with a Federal Reserve Bank, there could be ambiguity as to whether a particular asset is money received under a repurchase agreement. Therefore, to promote clarity and uniformity for purposes of determining whether certain assets would qualify as money, the OCC proposed that it would provide prior confirmation publicly that a medium of exchange (other than those defined as monetary value) meets the definition of “money” under the GENIUS Act. Specifically, the OCC proposed to define “money” for the purposes of part 15 to mean monetary value and any other medium of exchange that the OCC has determined is currently authorized or adopted by a domestic or foreign government, including a monetary unit of account established by an intergovernmental organization or by agreement between two or more countries. The OCC received a few comments addressing the definition of “money.” Commenters generally supported the proposed definition but suggested that the OCC incorporate certain additions. One commenter suggested that the OCC confirm that “money” does not include particular crypto-assets. Another commenter suggested that the OCC should not rely solely on the statutory language and should clarify that determinations issued are binding on all primary

Federal payment stablecoin regulators to prevent interagency inconsistency. Another commenter suggested that the OCC should explicitly state that any OCC determination must remain grounded in whether the instrument functions as a government-authorized medium of exchange, consistent with the GENIUS Act’s structure and purpose. The OCC is adopting the definition as proposed. The OCC believes that this definition will provide sufficient clarity as to what constitutes money and will allow the OCC to assess the facts presented by any particular medium of exchange. The OCC declines to confirm in regulation text whether any particular asset that is not monetary value is money because such regulation text may become dated quickly as governments may authorize or deauthorize such assets. To promote clarity and consistency, the OCC intends to publish any determinations it makes as to whether an asset constitutes “money” for purposes of part 15. National currency. The OCC proposed to define the term “national currency” as provided in the GENIUS Act, 12 U.S.C. 5901(19). Under the proposed rule, the term “national currency” would have meant (1) a Federal Reserve note (as the term is used in the first undesignated paragraph of section 16 of the Federal Reserve Act (12 U.S.C. 411)); (2) money standing to the credit of an account with a Federal Reserve Bank; (3) money issued by a foreign central bank; or (4) money issued by an intergovernmental organization pursuant to an agreement by two or more governments. The OCC received no comments addressing the definition of “national currency.” The OCC is adopting the definition as proposed. Nonbank entity. The OCC proposed to define the term “nonbank entity” as provided in the GENIUS Act, 12 U.S.C. 5901(20). Specifically, under the proposed rule, the term “nonbank entity” would have meant a person that is not a depository institution or subsidiary of a

depository institution. Consistent with the statutory definition, a nonbank entity could include a non-subsidiary affiliate of a depository institution. One commenter requested that the OCC confirm that the definition of nonbank entity can include certain FinCEN-registered money services businesses. The OCC confirms that any person that is not a depository institution or a subsidiary of a depository institution is a nonbank entity. Thus, money services businesses that are not depository institutions (or subsidiaries of depository institutions) are nonbank entities and may apply to become Federal qualified payment stablecoin issuers. In addition, as described above, under the final rule, an uninsured credit union would constitute a nonbank entity due to revisions to the definition of depository institution. The OCC is adopting the definition as proposed. Nonpublic personal information. The OCC proposed to define the term “nonpublic personal information” to mean information (1) provided by a customer to a permitted payment stablecoin issuer to obtain a financial product or service, (2) about a customer resulting from any transaction involving a financial product or service between the permitted payment stablecoin issuer and a customer, or (3) otherwise obtained by the permitted payment stablecoin issuer in connection with providing a financial product or service to a customer. The proposed definition did not include publicly available information, unless such publicly available information, when combined with other information, would reveal the identity of a customer or would enable access to the customer’s account. The OCC received several comments addressing the definition of nonpublic personal information. Commenters generally argued that the proposed definition is overbroad and should better distinguish between nonpublic customer information and information associated with

public blockchain activity or institutional transactions. Some commenters suggested that the OCC should limit the definition to information that is not publicly available and that an issuer receives in confidence through a direct customer relationship. Several commenters suggested that the OCC clarify that information recorded on a public blockchain is not nonpublic personal information for purposes of the rule. One commenter suggested that Travel Rule data transmitted as part of interbank settlement merits special treatment and should be dealt with under BSA/AML confidentiality frameworks rather than consumer privacy frameworks. The OCC is adopting the proposed definition, with certain modifications to the proposed exclusion for publicly available information. Under the final rule, nonpublic personal information does not include publicly available information, including information broadly accessible through a distributed ledger. The final rule eliminates language concerning the use of publicly available information that, when combined with other information, would reveal the identity of a customer or would enable access to the customer’s account. The OCC determined that this language was unnecessary because the reference to “other information” concerned nonpublic information. Under the final rule, for example, public wallet addresses would not be considered nonpublic information, but certain additional private information that could tie a customer’s identity to the address would be considered nonpublic information. Nonpublic information would also generally include sensitive customer information, described in greater detail below. The OCC believes that the revisions to the definitions of nonpublic personal information and customer combined with revisions to the final rule’s risk management requirements will provide greater clarity for permitted payment stablecoin issuers while ensuring that customer information is appropriately protected. With respect to the comment concerning Travel Rule data, the comment is outside the scope of this final rule. The OCC is clarifying that

the provisions of 12 CFR part 15 relating to nonpublic personal information do not alter any obligations under BSA/AML frameworks. OCC. The OCC proposed to substitute the term “OCC” for the term “Comptroller” as defined in the GENIUS Act, 12 U.S.C. 5901(4). Specifically, the proposed rule defined the term “OCC” to mean the Office of the Comptroller of the Currency. The proposed definition would refer to the organization as opposed to the individual who occupies the office. Using the term OCC is consistent with the agency’s terminology in other regulations for which it has rulemaking authority. The OCC received no comments addressing the definition of “OCC.” The OCC is adopting the definition as proposed. Outstanding issuance value. The OCC proposed to define the term “outstanding issuance value” to mean the total consolidated par value of all of a payment stablecoin issuer’s payment stablecoins. This would have included the combined total par value of different brands of payment stablecoin issued by the payment stablecoin issuer (e.g., under a white-label arrangement) to the extent that such an arrangement complies with proposed 12 CFR part 15. The OCC sought comment on the proposed definition, including whether it should include the par value of the issuance of non-consolidated affiliates. The OCC received several comments addressing the definition of “outstanding issuance value.” Commenters generally suggested that the OCC adopt a definition that is clear, operationally workable, and aligned with reserve backing and accurate measurement of circulating supply. Commenters urged the OCC to clarify the scope of “outstanding issuance value.” Commenters also asked the OCC to clarify the treatment of repurchased but not yet permanently retired tokens, temporary discrepancies caused by technical or legal compliance processes, and the application of the definition in multi-issuer or branded stablecoin arrangements.

The OCC is adopting the definition with certain clarifications. Under the final rule, “outstanding issuance value” means the total par value of all the payment stablecoins issued by a permitted payment stablecoin issuer. The final rule’s definition is consistent with the statute’s focus on the issuer, rather than the issuer’s affiliates. Absent conduct suggesting an attempt to evade the GENIUS Act or an arrangement that suggests that reserve assets may be inadequate or misallocated relative to outstanding issuance value, the OCC does not believe that it is generally necessary to include payment stablecoins issued by affiliates that are not consolidated into a permitted payment stablecoin issuer in the outstanding issuance value of the permitted payment stablecoin issuer. 30 Not including non-consolidated affiliates will also help ensure that business models that rely on multiple SPV issuers are not penalized relative to other business models. Such SPV issuers would only need to hold reserve assets against the payment stablecoins that they issue, rather than also needing to hold reserves against an affiliate’s payment stablecoins. In response to commenters, the OCC reiterates that, to be included within outstanding issuance value, an instrument must be a payment stablecoin, which means that the issuer must have incurred the obligation to convert, redeem, or repurchase the payment stablecoin. Thus, for purposes of calculating the outstanding issuance value, a digital asset that is, or is designed to be, used as a means of payment or settlement but for which there is not yet an obligation to convert, redeem, or repurchase for a fixed amount of monetary value would not be included in the calculation. A digital asset minted (i.e., created on a blockchain) by an issuer to be a payment stablecoin would not be included in the calculation of outstanding issuance value until the 30 The OCC notes, however, that in certain situations, the OCC may consider a non-consolidated affiliate’s issuance. For example, if a State qualified payment stablecoin issuer treats affiliate-issued stablecoins as fungible with its own and appears to use affiliates to stay under the $10 billion threshold for transition to the Federal framework, such behavior could indicate an attempt to evade the GENIUS Act or could, depending on the facts and circumstances, indicate unusual and exigent circumstances within the meaning of section 7 of the GENIUS Act (12 U.S.C. 5906).

obligation to convert, redeem, or repurchase the digital asset for a fixed amount of monetary value is incurred. For example, an issuer may mint a digital asset that it keeps in treasury, but it would not be considered a payment stablecoin or included in the calculation of the issuer’s outstanding issuance value until the digital asset was transferred to a third party or the issuer was otherwise obligated to convert, redeem, or repurchase the digital asset. Similarly, once an issuer permanently removes a payment stablecoin from circulation (e.g., burns the payment stablecoin), the digital asset would cease to be included in the calculation of outstanding issuance value. Payment stablecoins for which holder access has been restricted pursuant to applicable law, regulation, or court order would remain payment stablecoins, as the issuer’s obligation to convert, redeem, or repurchase for a fixed amount of monetary value continues and the associated reserves are maintained in segregated accounts pending resolution of the restriction. Likewise, if an issuer repurchased a payment stablecoin but did not burn the payment stablecoin, the stablecoin in the permitted payment stablecoin issuer’s inventory would not be part of the issuer’s outstanding issuance value because the issuer has no obligation to convert, redeem, or repurchase the stablecoin when it is in the issuer’s inventory (but would become part of the outstanding issuance value if the permitted payment stablecoin issuer subsequently put the payment stablecoin back into circulation). Therefore, the definition of “outstanding issuance value” only includes payment stablecoins for which the permitted payment stablecoin issuer is obligated to convert, redeem, or repurchase for a fixed amount of monetary value (i.e., generally the issued payment stablecoins in circulation). The final rule also excludes the word “consolidated” from the definition of outstanding issuance value. This is to better facilitate the use of SPV issuers under part 15. This revision makes clear that each SPV issuer only needs to have reserve assets backing the payment stablecoins that it issues. The OCC is adding the word

“consolidated” to certain other provisions of part 15 (relating to certain non-financial companies and nonbank State qualified payment stablecoin issuers) in light of this change and to maintain consistency with the requirements of the GENIUS Act. Payment stablecoin. The OCC proposed to define the term “payment stablecoin” consistent with the definition of the term in the GENIUS Act, 12 U.S.C. 5901(22), with certain technical changes. Under the proposal, the term “payment stablecoin” would have meant a digital asset (i) that is, or is designed to be, used as a means of payment or settlement; and (ii) the issuer of which (A) is obligated to convert, redeem, or repurchase for a fixed amount of monetary value, not including a digital asset denominated in a fixed amount of monetary value; and (B) represents that such issuer will maintain, or creates the reasonable expectation that it will maintain, a stable value relative to the value of a fixed amount of monetary value. 31 For a digital asset to be a payment stablecoin under proposed part 15, the issuer must be obligated to convert, redeem, or repurchase the digital asset for a fixed amount of monetary value. The proposed definition also provided that a “payment stablecoin” does not include a digital asset that is a (i) national currency; (ii) deposit (as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813)), including a deposit recorded using distributed ledger technology; or (iii) security, as defined in section 2 of the Securities Act of 1933 (15 U.S.C. 77b),
section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c), or section 2 of the Investment
Company Act of 1940 (15 U.S.C. 80a–2). The GENIUS Act’s definition of “payment stablecoin” also contains language clarifying that “no bond, note, evidence of indebtedness, or investment contract that was issued by a permitted payment stablecoin issuer shall qualify as a security 31 The OCC interprets the statutory language in 12 U.S.C. 5901(22) to mean that the permitted payment stablecoin issuer would be obligated to meet redemption requests at par.

solely [because the issuer satisfies] the conditions in [paragraph (1) of the proposed “payment stablecoin” definition], consistent with section 17 of the Act.” The GENIUS Act provides that this language was included “for the avoidance of doubt.” The OCC determined that it was not necessary to include this language in the proposed “payment stablecoin” definition because
section 17 of the GENIUS Act includes amendments to the cited Federal statutes that clarify that
payment stablecoins are not securities.
The OCC received several comments addressing the definition of “payment stablecoin.” Commenters generally sought a definition that more clearly distinguished payment stablecoins covered by the Act from other digital instruments. Commenters suggested that the OCC clarify the scope of the definition so that it captures instruments primarily designed and used for payment or settlement and excludes products that function instead as securities, investment instruments, tokenized deposits, closed-loop or community tokens, algorithmic tokens, or other nonpayment digital assets. Other commenters asked the OCC to clarify certain definitional boundaries (e.g., payment or settlement use, redemption obligations, reserve backing, and instruments structured under United States or foreign securities laws). One commenter stated that the definition should include products designed to circumvent the GENIUS Act. Some commenters stated that the term was appropriately defined. Commenters requested clarity regarding potential disclosures relating to the definition of payment stablecoin, with one commenter stating that the OCC should treat the core properties of a payment stablecoin—that it represents stable value and that it creates a reasonable appearance or expectation of redemption at or near par—disjunctively in order to assess violations of marketing restrictions. The commenter further stated that, by treating either condition as sufficient, the OCC would prevent regulatory arbitrage, ensure consistent application of core

protections, and maintain competitive neutrality. A different commenter stated that unregistered foreign payment stablecoin issuers of dollar-denominated crypto-assets purporting to hold a stable dollar-referenced value cannot use the term “payment stablecoin” to describe such instruments. Section 4(e)(3) of the GENIUS Act (12 U.S.C. 5903(e)(3)) prohibits the marketing of products as payment stablecoins when they are not issued pursuant to the GENIUS Act. The Department of the Treasury has enforcement authority with respect to that provision of the Act, so the OCC is not addressing that marketing prohibition in this final rule. The OCC is adopting the definition as proposed. The proposed definition aligns with the statutory definition and thus appropriately captures the scope of instruments that are payment stablecoins under the GENIUS Act. As in the proposed definition, the OCC does not believe that it is necessary to separately specify that “no bond, note, evidence of indebtedness, or investment contract that was issued by a permitted payment stablecoin issuer shall qualify as a security solely [because the issuer satisfies] the conditions in [paragraph (1) of the “payment stablecoin” definition], consistent with section 17 of the Act” because the GENIUS Act amended the pertinent securities laws to specify that a payment stablecoin is not a security. Thus, including this language from section 2(22)(B)(iii) would be redundant. The OCC believes that other changes to the definition may risk deviating from the scope of instruments intended to be captured by the GENIUS Act’s definitions. In response to specific comments, the OCC notes that instruments for which an issuer is not obligated to convert, redeem, or repurchase for a fixed amount of monetary value are outside the scope of the definition of “payment stablecoin” for purposes of part 15. Redefining “payment stablecoin” based on the characteristics noted by certain commenters would be inconsistent with the statutory definition. Because the definition of monetary value does not include payment stablecoins, a stablecoin that is redeemable for a

payment stablecoin is not itself a payment stablecoin. Thus, for purposes of the OCC’s implementation of the Act, a “wrapped” stablecoin generally would not be a payment stablecoin. The OCC does not believe that it is necessary to define payment or settlement. The statute merely requires that a payment stablecoin be, or be designed to be, used as a means of payment or settlement. It does not require that the primary purpose of the payment stablecoin be payment or settlement. In light of this fact, and the broad scope of what is generally included within payment or settlement, the OCC expects that most stablecoins could meet this prong of the definition of payment stablecoin. Accordingly, the OCC does not believe that it is necessary to further define “payment” or “settlement” for purposes of the definition of payment stablecoin. The OCC also believes that the definition appropriately and clearly excludes deposits, including deposits in tokenized form, and that additional revisions are not necessary to distinguish payment stablecoins from deposits. Payment stablecoin holder. The proposed rule did not define the term “payment stablecoin holder” but used the term in several sections and requested comment on whether to define “stablecoin holder.” The OCC received several comments concerning the definition of customer and payment stablecoin holder. Several comments recommended distinguishing the two terms, with “customer” referring to persons that interact directly with an issuer and “payment stablecoin holder” referring to beneficial owners of payment stablecoins (or, in some cases, beneficial and legal owners of payment stablecoins). One comment stated that the OCC should not define the term “stablecoin holder.” This commenter asserted that the GENIUS Act does not use the term (but rather uses the term “holder of any payment stablecoin”) and stated that defining a new term would exceed the authority delegated to the OCC. This commenter also stated that the GENIUS Act concerns payment stablecoins only, so the term would be overbroad.

Others stated that the OCC should define the term to include both legal and beneficial owners of payment stablecoins. These commenters stated that interpreting the term was within the OCC’s interpretive authority. In response to these comments, the OCC is defining the term “payment stablecoin holder” rather than “stablecoin holder.” This will clarify that the scope is limited to holders of payment stablecoins that are issued or held in custody by entities engaged in activities that are subject to the GENIUS Act. The final rule defines payment stablecoin holder to mean the beneficial owner of a payment stablecoin. The OCC is defining this term solely for purposes of the OCC’s implementing regulations and doing so does not exceed the OCC’s authority. The definition in the final rule does not affect, for example, the insolvency provisions in section 11 of the GENIUS Act. The definition will appropriately distinguish persons that merely control a payment stablecoin on another’s behalf (e.g., custodians) from persons that would benefit economically from a payment of interest or yield on a payment stablecoin. This definition, combined with the change to the definition of customer, will help ensure that part 15 is not unduly burdensome and that the requirements with respect to payment stablecoin holders and customers are appropriately scoped. The OCC notes that the GENIUS Act uses the term “payment stablecoin holder” six times in other contexts in addition to the substantially similar phrase “holder of any payment stablecoin” in the context of the yield prohibition. The statute is unclear as to whether the term refers to any person that controls a payment stablecoin or rather the beneficial owner of a payment stablecoin. Clarifying this point is important to implementing the statutory prohibition against paying interest or yield solely in connection with the holding, use, or retention of a payment stablecoin in section 4(a)(11) of the GENIUS Act (12 U.S.C. 5903(a)(11)).

Permitted payment stablecoin issuer. The OCC proposed to define the term “permitted payment stablecoin issuer” consistent with the definition of the term in the GENIUS Act, 12 U.S.C. 5901(23), with certain modifications. Specifically, the proposed definition would have limited the definition to the entities that are subject to the OCC’s jurisdiction, including State qualified payment stablecoin issuers subject to the OCC’s regulatory authority under section 4 of the GENIUS Act (12 U.S.C. 5903). 32 In addition, the proposed definition cross-referenced the relevant proposed implementing provision in place of the statutory provision included in the GENIUS Act’s definition. Under the proposed rule, the term “permitted payment stablecoin issuer” would have meant a person formed in the United States that is a (1) subsidiary of an insured national bank or Federal savings association that has been approved to issue payment stablecoins under § 15.30; (2) Federal qualified payment stablecoin issuer; or (3) State qualified payment stablecoin issuer subject to the OCC’s regulatory or enforcement authority under
section 4 of the GENIUS Act (12 U.S.C. 5903). 33
The OCC received several comments addressing the definition of “permitted payment stablecoin issuer.” Comments generally supported the definition but suggested clarifications to identify the responsible issuing entity while avoiding overinclusion of affiliated parties or service providers. Commenters also suggested that the OCC clarify which entities qualify as issuers (e.g., uninsured Federal branches, agencies, and multi-issuer payment stablecoin structures). Other commenters asked the OCC to distinguish between entities with primary legal and 32 See Scope section-by-section analysis, supra. 33 In addition, the OCC has enforcement authority pursuant to section 7(e)(2) of the GENIUS Act (12 U.S.C. 5906(e)(2)) with respect to certain nonbank State qualified payment stablecoin issuers in unusual and exigent circumstances. Proposed § 15.16 would address the requirements applicable to certain State qualified payment stablecoin issuers under unusual and exigent circumstances, but the OCC is not proposing to include State qualified payment stablecoin issuers that come within the OCC’s jurisdiction solely as a result of section 7(e)(2) of the GENIUS Act within the definition of permitted payment stablecoin issuer.

economic responsibility for issuing, redeeming, and backing payment stablecoins and service providers or intermediaries that perform ancillary technical, distribution, or support functions. The OCC is adopting the definition as proposed. The definition closely matches the statutory definition, with minor changes to reflect the OCC’s jurisdiction. In response to comments, the OCC confirms that, consistent with the definition of payment stablecoin in
section 2 of the GENIUS Act (12 U.S.C. 5901(22)), for the purposes of part 15, the permitted
payment stablecoin issuer is the entity that is obligated to convert, redeem, or repurchase a tendered payment stablecoin for a fixed amount of monetary value (not including a digital asset denominated in a fixed amount of monetary value). A service provider that is not obligated to convert, redeem, or repurchase is not a permitted payment stablecoin issuer. Under the statute, a variety of entities may be permitted payment stablecoin issuers subject to the OCC’s jurisdiction, including subsidiaries of insured national banks or Federal savings associations; Federal qualified payment stablecoin issuers that are approved by the OCC, comprising uninsured national banks, Federal branches, or nonbank entities; or State qualified payment stablecoin issuers that transition to the OCC’s regulatory framework. As discussed above, due to changes in the definition of “depository institution,” an uninsured credit union would qualify as a nonbank and could seek to be a Federal qualified payment stablecoin issuer. Person. The OCC proposed to define the term “person” as the term is defined in the GENIUS Act, 12 U.S.C. 5901(24). As proposed, the term “person” would have meant an individual, partnership, company, corporation, association, trust, estate, cooperative organization, or other business entity, incorporated or unincorporated.

The OCC received a few comments addressing the definition of “person.” Commenters generally agreed with the definition but sought clearer boundaries around which collective arrangements would be treated as associations. Commenters suggested that the OCC clarify that the definition applies to legally identifiable entities or organized groups capable of exercising governance or control. Other commenters also urged the OCC to address how the definition applies in decentralized or algorithmically governed structures, while another commenter supported keeping the definition broad. The OCC is adopting the definition as proposed. The statutory definition of “person” in
section 2(24) of the Act (12 U.S.C. 5901(24)) is broad and expressly includes individuals,
partnerships, and both incorporated and unincorporated business entities. Accordingly, the OCC declines to exclude arrangements that are not legally identifiable as such arrangements may be included within the statutory definition. The OCC also declines to opine as to whether decentralized arrangements generally would constitute a person, as the determination would depend on the facts and circumstances of the arrangement. As with its other regulations, interested parties may request that the OCC provide interpretive guidance, as necessary. Principal shareholder. The OCC proposed to define the term “principal shareholder” to mean a person who directly or indirectly or acting in concert with one or more persons, or together with members of their immediate family, will own, control, or hold 10 percent or more of the voting stock of the permitted payment stablecoin issuer or applicant. This definition is substantially similar to the definition used in the OCC’s general licensing regulations in 12 CFR 5.20(d)(10).

The OCC received a few comments addressing the definition of “principal shareholder.” Commenters generally agreed with the definition but requested additional clarity regarding identifying control and significant ownership interests. Commenters suggested that the OCC clarify how the definition applies to governance rights and influences that may not take the form of traditional securities ownership. Other commenters suggested that the OCC clarify the meaning of “acting in concert” and align the definition with existing banking law concepts. The OCC is adopting the definition as proposed. As discussed above, the OCC believes that it is unnecessary to define “acting in concert” for purposes of 12 CFR part 15 at this time. The OCC also believes that it is unnecessary to change the definition of principal shareholder. Retaining the proposed definition would maintain parity between the treatment of permitted payment stablecoin issuers and national banks and Federal savings associations. Private key. The OCC proposed to define the term “private key” to mean the unique alphanumeric string that allows an individual to transfer a particular unit of a digital asset using a distributed ledger. While the preamble to the proposal noted that this definition was intended to include shards of a private key, 34 several commenters noted that the definition in the regulatory text nonetheless implies a static single-key architecture and does not easily fit with a distributed￾key architecture, wherein cryptographic key shares are distributed across independent parties or hardware environments such that the full key material is not held in any one place and exists only as a mathematical construct realized at the moment of signing. The OCC has decided to modify the definition to more expressly address sharding. Under the final rule, private key means 34 Sharding refers to dividing a private key into distinct pieces for enhanced security.

the cryptographic material, whether held in whole, in shares, or reconstructed ephemerally, that confers the ability to authorize a transaction on a distributed ledger. Publicly available information. The OCC proposed to define the term “publicly available information” to mean any information that a person has a reasonable basis to believe is lawfully made available to the general public from: (1) Federal, State, or local government records; (2) widely distributed media; (3) disclosures to the general public that are required to be made by Federal, State, or local law; or (4) a distributed ledger. 35 The OCC received a few comments addressing the definition of “publicly available information.” Commenters generally suggested that the OCC provide clearer treatment of blockchain-based information within the privacy framework. Some commenters suggested that the definition should apply to distributed ledger or on-chain transaction data. Other commenters suggested that privacy protections should not be eliminated where issuers can control disclosure or where transaction data can be linked to identifiable individuals. Other commenters suggested that certain transaction-level data should be treated as protected financial records rather than excluded from coverage altogether. The OCC is adopting the definition as proposed. The OCC believes that this approach, combined with revisions to § 15.13 and to the definitions of customer and nonpublic personal information, appropriately provides a robust data protection requirement with respect to customers of a permitted payment stablecoin issuer. As discussed in greater detail above, in response to commenters, the revisions to the definition of nonpublic personal information 35 As noted above, the term “distributed ledger” is limited to publicly available and accessible ledgers.

discussed above further emphasize that information broadly available through a distributed ledger would generally be outside the scope of nonpublic personal information. Registered public accounting firm. The OCC proposed to define the term “registered public accounting firm” as provided in the GENIUS Act, 12 U.S.C. 5901(26). Under the proposal, the term “registered public accounting firm” would have meant a registered public accounting firm set forth in section 2 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7201). The OCC received no comments addressing the definition of “registered public accounting firm.” The OCC is adopting the definition as proposed. Related interest. The OCC proposed to define the term “related interest” of a person to mean (1) a company that is controlled by that person; or (2) a political or campaign committee that is controlled by that person or the funds or services of which will benefit that person. This term is relevant to the risk management standards for insider and affiliate transactions and is derived from the definition in Regulation O (12 CFR part 215). The OCC received no comments addressing the definition of “related interest.” The OCC is adopting the definition as proposed. Reserve asset. The OCC proposed to define the term “reserve asset” to mean an asset maintained by a permitted payment stablecoin issuer of a type enumerated in § 15.11(b). 36 The OCC received no comments addressing the definition of “reserve asset.” The OCC is adopting the definition as proposed. Reserve asset value. The final rule defines reserve asset value to mean the sum of: (1) the total fair value of reserve assets, net of any associated liabilities, other than United States coins and currency; and (2) the total face value of reserve assets comprising United States coins and 36 A permitted payment stablecoin issuer may maintain reserve assets at a custodian.

currency. The proposed rule did not include this term. Rather, it required all reserve assets to be valued at fair value for the purpose of ensuring that the total outstanding issuance value is backed on at least a 1 to 1 basis by reserve assets. The OCC is adopting this new term because, in the case of United States coins and currency, it is more appropriate to value these items based on face value. This confirms, for instance, that a permitted payment stablecoin issuer may not back a payment stablecoin based on the metallic or collector value associated with a particular coin (which may be volatile). The OCC acknowledges that the use of coins or currency to back a payment stablecoin is likely to be rare. Thus, in most instances, reserve asset value will be determined purely by the fair value of reserve assets. The final rule also clarifies that reserve asset value is calculated net of associated liabilities. Notably, this makes clear that assets that a permitted payment stablecoin issuer is obligated to repurchase under a repurchase agreement may not be essentially double counted when determining the permitted payment stablecoin issuer’s reserve asset value. If, for example, an issuer holds a Treasury security as a reserve asset and pledges the security pursuant to a repurchase agreement, the issuer would include the cash received under the repurchase agreement in its reserve asset value but must also subtract its obligation to repurchase the Treasury security. Senior management. Proposed §§ 15.14(i) and 15.42(a)(5) referred to the senior management of a permitted payment stablecoin issuer. The proposal did not define the term but sought comment on whether to do so. The OCC received a few comments stating that the term should align with “executive officers” or a subset thereof. One commenter said that a formal definition was not necessary, but the term should be read to include the individuals responsible for day-to-day management, rather than looking to titles alone. Section 15.42 refers to senior management only in a list of examples of factors the OCC may consider. Accordingly, the OCC

does not believe that a definition is necessary for senior management in § 15.42. With respect to § 15.14, as discussed in greater detail below, the OCC is providing additional specificity as to which executive officers must attest to each quarterly report. The final rule, like the proposal, does not define “senior management.” Sensitive customer information. One commenter requested that the OCC either define “sensitive customer information” or else replace the term with customer nonpublic information. To provide greater clarity, under the final rule, “sensitive customer information” means any combination of components of customer information that would reveal the identity of the customer or allow someone access to the customer’s account, including a customer’s public key in conjunction with the customer’s private key. Share account. The final rule includes the new term “share account.” Under the final rule, this term means an “account” as defined in section 101 of the Federal Credit Union Act (12 U.S.C. 1752(5)). The term is relevant to the reserve asset provisions in § 15.11 and the operational backstop provisions in § 15.41. Stablecoin Certification Review Committee. The OCC proposed to define the term “Stablecoin Certification Review Committee” consistent with the definition in the GENIUS Act, 12 U.S.C. 5901(27) by incorporating by reference the statutory definition. The proposed rule defined the term “Stablecoin Certification Review Committee” as having the meaning set forth in section 2 of the GENIUS Act (12 U.S.C. 5901(27)). The OCC received no comments addressing the definition of “Stablecoin Certification Review Committee.” The OCC is adopting the definition as proposed.

State. The OCC proposed to define the term “State” as provided in the GENIUS Act, 12 U.S.C. 5901(28). The proposed rule defined the term “State” to mean each of the several States of the United States, the District of Columbia, and each territory of the United States. 37 The OCC received no comments addressing the definition of “State.” The OCC is adopting the definition as proposed. State-chartered depository institution. The OCC proposed to define the term “State￾chartered depository institution” as provided in the GENIUS Act, 12 U.S.C. 5901(29). Specifically, the proposed rule would have defined the term “State-chartered depository institution” as having the meaning as set forth for “State depository institution” in section 3(c) of the Federal Deposit Insurance Act (12 U.S.C. 1813(c)(5)). The OCC received no comments addressing the definition of “State-chartered depository institution.” The final rule, however, does not use the term. The final rule therefore does not adopt the term. State payment stablecoin regulator. The OCC proposed to define the term “State payment stablecoin regulator” as provided in the GENIUS Act, 12 U.S.C. 5901(30). As such, the OCC proposed to define “State payment stablecoin regulator” to mean a State agency that has primary regulatory and supervisory authority in such State over entities that issue payment stablecoins. The OCC received no comments addressing the definition of “State payment stablecoin regulator.” The OCC is adopting the definition as proposed. 37 United States territories are also referenced in the proposed definition of “foreign payment stablecoin issuers.” The GENIUS Act and the proposed and final rules address the potential overlap created by the inclusion of territories in both definitions by defining “foreign payment stablecoin issuers” to exclude “permitted payment stablecoin issuers.” Therefore, if a payment stablecoin issuer is a “permitted payment stablecoin issuer” because it is a “State qualified payment stablecoin issuer” that is legally established under the laws of a territory of the United States then by definition it cannot be a “foreign payment stablecoin issuer.”

State qualified payment stablecoin issuer. The OCC proposed to define the term “State qualified payment stablecoin issuer” consistent with the definition of that term in the GENIUS Act, 12 U.S.C. 5901(31), with a non-substantive, clarifying change. Under the proposed rule, the term “State qualified payment stablecoin issuer” would have meant an entity that is (1) legally established under the laws of a State and approved to issue payment stablecoins by a State payment stablecoin regulator; and (2) not an uninsured national bank chartered by the OCC pursuant to title LXII of the Revised Statutes, a Federal branch, an insured depository institution, or a subsidiary of such an uninsured national bank, Federal branch, or insured depository institution. The proposed definition clarified the definition of “State qualified payment stablecoin issuer” provided in the GENIUS Act by adding the phrase “an uninsured” before the term “national bank” in the list of excluded subsidiaries to parallel the description of excluded entities in the preceding list. The OCC received no comments addressing the definition of “State qualified payment stablecoin issuer.” The OCC is making one clarifying edit, replacing the term “entity” with the term “person,” because “person” is a defined term in the final rule. Otherwise, the OCC is adopting the definition as proposed. Subsidiary. The OCC proposed to define the term “subsidiary” as provided in the GENIUS Act, 12 U.S.C. 5901(32). Specifically, the proposed rule would have defined the term “subsidiary” as having the meaning set forth in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813(w)(4)). Because the term in section 3 of the Federal Deposit Insurance Act relies on the definitions of “company” and “control” in section 2 of the Bank Holding Company Act, the OCC proposed to incorporate those definitions in proposed part 15, tailored to the extent necessary, as described above.

The OCC received no comments addressing the definition of “subsidiary.” The OCC is adopting the definition as proposed. Tokenized form. The proposed rule did not define “tokenized form” but used the term in §
15.11 and § 15.32. The OCC received several comments requesting that the OCC clarify the
meaning of the term “tokenized form.” Under section 4(a)(1)(A)(viii) (12 U.S.C. 5903(a)(1)(A)(viii)) of the GENIUS Act, certain reserve assets may be in tokenized form, but the Act does not define what constitutes tokenized form. Commenters generally agreed that any definition should ensure that a reserve asset in tokenized form provides the same legal rights as a reserve asset in non-tokenized form. Several commenters urged the OCC to provide clearer and more coordinated standards for tokenized reserve assets, including through coordination with the SEC, Federal Reserve, FDIC, CFTC, FinCEN, and Treasury and, in some cases, a joint policy statement or standardized supervisory assessment framework. Some commenters stated that tokenized forms of otherwise eligible reserve assets should be presumptively permissible and evaluated under a principles-based approach focused on economic substance, legal certainty, enforceable and bankruptcy-remote claims to the underlying assets, custody and segregation protections, and the issuer’s ability to promptly monetize the assets to meet redemptions. Several commenters suggested that eligibility should not depend on the technology used to record ownership. Some commenters urged the OCC to provide a transparent approval process or public list of permissible tokenized reserve assets. Other commenters suggested that case-by-case approval should not be required and that assets approved in conventional form should automatically be permitted in tokenized form. The OCC agrees with commenters that it is important to define “tokenized form” and to ensure that reserve assets in tokenized form provide the same rights as reserves in non-tokenized

form. The final rule defines “tokenized form” to mean, with respect to an asset, that: (1) the authoritative record of the asset is maintained using distributed ledger technology, regardless of whether a corresponding non-tokenized instrument or account entry also exists; and (2) the legal rights conferred by the asset are identical to those that would be conferred by a non-tokenized form of the asset under applicable law. This definition is generally consistent with the scope of the term “tokenized security” in the Federal Banking Agencies FAQ concerning tokenized securities. 38 The definition includes a digital asset that represents, and provides identical legal rights as, a traditionally issued asset as well as a digitally native asset that provides the identical legal rights as a non-tokenized version of the same asset. For example, a money market fund that qualified as a permissible reserve asset under section 4(a)(1)(A)(vi) of the Act (12 U.S.C. 5903(a)(1)(A)(vi)) could be held in tokenized form if the fund was issued directly on a distributed ledger. Alternatively, a token representing ownership of a traditionally issued money market fund could also be a reserve in tokenized form, depending on how the tokenization was implemented and which rights would be conferred on the holder. In such instances, the tokens would need to provide identical rights to those associated with owning the asset held in custody. The OCC encourages any permitted payment stablecoin issuer that seeks clarity on whether a specific asset is an asset in tokenized form and whether such asset qualifies as a permissible reserve asset under § 15.11(b) to consult with the OCC as to whether the asset qualifies. Trading volume. The OCC proposed to define the term “trading volume” to mean the aggregate number of payment stablecoins issued by a permitted payment stablecoin issuer that were purchased or sold on exchanges during a specified period of time. In the proposal, the term 38 See OCC Bulletin 2026-7, “Regulatory Capital: Interagency FAQs on Tokenized Securities” (March 5, 2026), https://www.occ.gov/news-issuances/bulletins/2026/bulletin-2026-7.html.

was to be used as a metric to determine a permitted payment stablecoin issuer’s examination
schedule.
The OCC received several comments addressing the definition of “trading volume.” Commenters suggested that the definition be revised to be more analytically useful, operationally feasible, and tailored to the realities of digital asset markets. Commenters suggested that the OCC distinguish trading activity from settlement activity. Other commenters suggested that the OCC clarify the scope of “exchange,” particularly how it applies to centralized and decentralized platforms, while limiting reporting expectations to data reasonably available to issuers. The final rule eliminates the term “trading volume” because, as described below, the final rule does not use trading volume as a metric to determine a permitted payment stablecoin issuer’s examination schedule. Permitted payment stablecoin issuers would be required to provide certain information concerning trading volume as part of the reports required under § 15.14 of the final rule, but the OCC has concluded that the instructions for the reporting form are the more appropriate place to define “trading volume” for those purposes. United States customer. The OCC proposed to define the term “United States customer” to mean a customer that resides in the United States. The OCC received several comments addressing the definition of “United States customer.” Commenters suggested that the OCC adopt a clearer and more administrable standard for identifying United States customers. Commenters generally supported further clarification of the term. Some commenters sought clarification on how United States residence or location should be determined, whether the definition should be tied to direct customer relationships, and how it should apply to institutional customers, foreign intermediaries, and secondary-market activity. Some commenters suggested

that the OCC adopt an approach that is more operationally workable and aligned with jurisdictional boundaries. Other commenters cautioned against creating a definition that assumes a level of precision issuers may not be able to achieve. To provide additional clarity, the final rule revises § 15.31(a)(3) (discussed in greater detail below) and redefines “United States customer” to mean a customer that, at the time of onboarding: (1) is an individual and resides in the United States, 39 (2) is incorporated or organized under the laws of the United States or any State; or (3) has its principal place of business in the United States. 40 Specifying both when and how a person is determined to be a United States customer will enhance the operability of this provision of the final rule and provide clear lines for foreign payment stablecoin issuers and customers. This definition does not affect the definition of “customer” for purposes of other laws and regulations, including privacy laws and the Bank Secrecy Act and its implementing regulations.
4. Severability (§ 15.3)
Proposed § 15.3 provided that the provisions of the proposed rule were separate and severable from one another. If any provision is stayed or determined to be invalid, it was the OCC’s intention that the remaining provisions would have continued in effect. As noted in the proposal, 41 the OCC generally intends all of its rulemakings to be severable to the extent portions of the rule are determined to be invalid regardless of the presence of a severability clause. The OCC proposed to include an explicit severability clause because of 39 For the purposes of determining residence in the United States, United States citizens are considered to be residents. For non-United States citizens, residence is determined by the test in 26 CFR 301.7701(b)-1. Pursuant to that test, an individual will be considered to be residing in the United States if he or she is a lawful permanent resident (i.e., has a green card) or meets the substantial presence test. 26 CFR 301.7701(b)-1(b) and (c). 40 See Hertz Corp. v Friend, 559 U.S. 77 (2010) (describing the test for what constitutes a corporation’s principal place of business). 41 91 FR 10210.

the novelty and scope of the GENIUS Act and the importance of ensuring as much certainty as possible for the regulatory framework for payment stablecoins. The OCC received no comments addressing § 15.3 and is finalizing § 15.3 as proposed.
5. Reservation of Authority (§ 15.4)
The OCC is adding, in the final rule, a general reservation of authority provision. Section
15.4 provides that the OCC may waive or modify the requirements of part 15 or adopt different
procedures implementing this part, as necessary, to administer and carry out the requirements of the GENIUS Act (12 U.S.C. 5901 et seq.), including with respect to ensuring financial stability, ensuring timely redemption of payment stablecoins, and protecting the claims of payment stablecoin holders. The OCC is adopting this provision in recognition of the nascent nature of the stablecoin industry and the novelty of the GENIUS Act framework. The OCC will only exercise this reservation of authority where consistent with the GENIUS Act and where circumstances justify its use. The OCC generally uses reservations sparingly to address unanticipated circumstances for which a rulemaking is not appropriate. B. Subpart B—Permitted Payment Stablecoin Issuers and State Qualified Payment Stablecoin Issuers

1. Activities (§ 15.10)
   a. Overview of Changes from Proposed Rule to Final Rule for § 15.10 The OCC is adopting § 15.10 as proposed with modifications, as described below. The OCC is modifying the language in paragraph (a) for clarity and replacing the word “only” with “not engage in any activity other than the following:” to make clear that the list of activities in final § 15.10(a) is an exclusive list of activities that permitted payment stablecoin

issuers may engage in. Within the § 15.10(a) list of permitted activities for permitted payment stablecoin issuers, the OCC is adopting § 15.10(a)(1) through (7) as proposed. The OCC is adopting § 15.10(a)(8), renumbered as § 15.10(a)(11), as proposed except for a clarification that other activities include the hiring of third parties. The OCC is adding three new activities to the list of permitted activities. First, in new § 15.10(a)(8) of the final rule, the agency allows permitted payment stablecoin issuers to hold as principal non-payment stablecoin digital assets as necessary to pay fees, including customer fees and network fees, or to conduct necessary testing on distributed ledger-based platforms, provided that such principal holdings shall not exceed quantities necessary for the reasonably foreseeable conduct of such activities. Second, in § 15.10(a)(9) of the final rule, the OCC allows permitted payment stablecoin issuers to establish a trust arrangement under applicable law for reserve assets, including the granting of a security interest in reserve assets, provided that any security interest in reserve assets granted to the trustee is for the sole benefit of payment stablecoin holders, the arrangement with the trustee does not impair the permitted payment stablecoin issuer’s ability to timely redeem payment stablecoins in the normal course of business prior to default, the arrangement does not introduce claims that would compete with the claims of payment stablecoin holders of payment stablecoins issued by the permitted payment stablecoin issuer in the event of the insolvency of the permitted payment stablecoin issuer, and the arrangement with the trustee does not impair the ability of a receiver of the permitted payment stablecoin issuer to direct the prompt transfer or liquidation of the reserve assets in order to pay claims to payment stablecoin holders. Third, the OCC is adding the management of foreign exchange risk, subject to the requirements of § 15.13(a)(10) of the final rule, as a permitted

activity. Section 15.13(a)(10) of the final rule provides the relevant risk management principles for foreign exchange risk. The OCC is adopting the rule of construction in § 15.10(b) as proposed, renumbered as § 15.10(b)(1). Additionally, the OCC is adopting an additional provision in final § 15.10(b)(2) that provides that nothing in § 15.10(a) limits the authority of a permitted payment stablecoin issuer to engage in an activity consistent with section 4(a)(7)(B) of the Act (12 U.S.C. 5903(a)(7)(B)). This change is made to clarify that permitted payment stablecoin issuers may engage in digital asset service provider activities specified by the Act, and activities incidental thereto, that are authorized by the OCC and independently authorized by applicable Federal or State law, to the extent that any such State law is not inconsistent with Federal law. Within the list of prohibitions listed in § 15.10(c), the OCC is adopting § 15.10(c)(1) through (3), and (c)(6) as proposed. The agency is modifying § 15.10(c)(4) to eliminate the rebuttable presumption in § 15.10(c)(4)(i) through (iii) and to replace the use of “holder of any payment stablecoin” with “payment stablecoin holder,” which is now a defined term, in § 15.10(c)(4). Additionally, the OCC is making clarifying edits to § 15.10(c)(5) to remove paragraph (c)(5)(iii)(C) and add new § 15.10(d), which provides that pursuant to section 4(a)(2)(ii) of the GENIUS Act (12 U.S.C. 5903(a)(2)(ii)) and § 15.10(c)(5)(iii)(B), the OCC approves, for all permitted payment stablecoin issuers, repurchase agreements wherein the Treasury bills that are sold as purchased securities have a maturity of 93 days or less. The OCC is also modifying paragraph (c)(5)(iii)(B) to provide that a permitted payment stablecoin issuer may receive approval of a repurchase agreement by order or pursuant to final § 15.10(d). b. Description of Proposed Rule, Comments, and Final Rule Enumerated Permissible Activities in § 15.10(a)(1) through (4): Core Statutory Activities

Consistent with the statute, the OCC proposed to mirror the permitted activities set forth in section 4(a)(7)(A) of the GENIUS Act (12 U.S.C. 5903(a)(7)(A)) in proposed § 15.10(a)(1) through (4), which include: (1) issuing payment stablecoins; (2) redeeming payment stablecoins; (3) managing reserves related to the issuance or redemption of payment stablecoins, including purchasing, selling, and holding reserve assets or providing custodial services for reserve assets, consistent with applicable State and Federal law; and (4) providing custodial or safekeeping services for payment stablecoins, required reserves, or private keys of stablecoins consistent with the GENIUS Act, as implemented in proposed subpart C. Additionally, consistent with section 4(a)(7)(A)(v) of the GENIUS Act (12 U.S.C. 5903(a)(7)(A)(v)), proposed § 15.10(a)(8) provided that a permitted payment stablecoin issuer may undertake any other activities that directly support any of the activities in proposed § 15.10(a)(1) through (4). With respect to the activities enumerated in proposed § 15.10(a)(1) through (4) as implementations of section 4(a)(7)(A)(i) through (iv), commenters did not express substantive concerns. Two commenters offered suggestions about how the agency should list or otherwise recognize additional permissible activities, including integration with payment networks and development of compliance tools. One comment suggested the regulation remain narrowly focused such that stablecoin issuers may engage in necessary activities, but any additional activities should be closely connected to stablecoin issuance. With respect to integration with payment networks and development of compliance tools, without more information, the OCC cannot determine whether such activities are permissible. While these activities might qualify as directly supporting activities pursuant to final § 15.10(a)(11), the OCC would need to assess the facts underlying these activities prior to making such a determination. The OCC invites permitted payment stablecoin issuers to seek

clarification from the OCC as to whether a particular activity is permissible. For the list of enumerated permissible activities in § 15.10(a)(1) through (4), the agency declines to focus only on necessary activities and activities closely connected to stablecoin issuance. The commenter’s requirement of a close connection to stablecoin issuance alters the statutory test and does not account for activities that are authorized, such as redemption of payment stablecoins, managing related reserves, and providing custodial or safekeeping services. Accordingly, the OCC is adopting § 15.10(a)(1) through (4) as proposed, with a clarifying edit in paragraph (a) to replace the word “only” with “not engage in any activity other than the following:” to make clear that the list of activities in final § 15.10(a) is an exclusive list of activities that permitted payment stablecoin issuers may engage in. Activities that Directly Support: Proposed § 15.10(a)(8), Renumbered as Final § 15.10(a)(11) In proposed § 15.10(a)(8), consistent with section 4(a)(7)(A)(v) of the GENIUS Act (12 U.S.C. 5903(a)(7)(A)(v)), the OCC included a provision that would have provided that permitted payment stablecoin issuers may undertake any other activities that directly support the issuance of payment stablecoins, redemption of payment stablecoins, managing reserves related to the issuance or redemption of payment stablecoins, or providing custodial or safekeeping services for payment stablecoins. One such example of an activity that would qualify under proposed § 15.10(a)(8) because it directly supports both issuance and redemption of payment stablecoins would be the permitted payment stablecoin issuer’s holding of non-payment stablecoin digital assets as principal necessary for testing a distributed ledger, whether internally developed or

acquired from a third party. Such an activity may be necessary to ensure that the permitted payment stablecoin issuer may operate safely and effectively on a distributed ledger. 42 Several commenters suggested the OCC provide additional examples of activities that directly support such activities or otherwise indicate that such activities are broader than what the proposed rule illustrated. Among these commenters, one argued that the above example (holding non-payment stablecoin digital assets as principal for testing a distributed ledger) could imply the agency would limit permissible activities that directly support to those that are necessary. This commenter suggested a broader definition. Various commenters suggested the agency provide specific examples of directly supporting activities, and some commenters offered examples. Such examples included, among other things, the operation of distributed ledger nodes, smart contract deployment, wallet infrastructure and key management, blockchain transaction monitoring, and settlement and liquidity services. As an alternative to listing examples, one commenter suggested that the agency publish separate interpretive guidance specifically on the scope of proposed § 15.10(a)(8) activities. Several commenters suggested the agency take a narrow understanding of “directly support” in
section 4(a)(7)(A)(v) of the Act (12 U.S.C. 5903(a)(7)(A)(v)). These commenters suggested a
broad interpretation could allow such activities to expand over time or overlap with activities that generally require State licensing. One commenter recommended that activities permissible under the “directly support” prong should only be those that materially facilitate certain other permitted activities or are operationally necessary for those activities. 42 As discussed infra, this activity is enumerated as a permissible activity, subject to certain conditions in final rule § 15.10(a)(8).

Congress’s use of “directly support” demonstrates the statute does not limit permitted activities to those that are necessary for one of the statute’s enumerated activities. 43 Such a reading would add a substantive limitation—namely, that the activities be strictly necessary— that is absent from the text of the statute. Given the innovation in the payment stablecoin industry, a limitation of “directly support” to what is strictly necessary for one current operational model could also stifle innovation. The above example of holding crypto-assets as principal for testing does not necessarily illustrate the outer perimeter of activities that fit under the “directly support” prong; it is only intended to be a clarifying example. With respect to the examples for which commenters requested clarification, the OCC declines to opine on the permissibility of such activities in the final rule without additional information. The OCC encourages permitted payment stablecoin issuers to seek clarification from the OCC regarding the permissibility of such activities. One commenter suggested the agency adopt a brand- and technology-neutral interpretation of the Act’s “directly support” language. As indicated above, the agency is aware technology and business models may change substantially. To avoid locking industry participants into the current standards that may quickly become outdated and run counter to the Act’s goals, the OCC plans to, consistent with its general technology-neutral approach, follow a brand- and technology-neutral understanding of the “directly support” language in the statute and rule. Some comments combined discussion of the scope of proposed § 15.10(a)(8) permissible activities with discussion of the appropriate risk management practices. One such commenter 43 In addition, Congress uses the word “necessary” in other sections of the Act. See, e.g., sections 4(a)(4)(A)(i)(III) and 7(e)(1)(C) of the Act (12 U.S.C. 5903(a)(4)(A)(i)(III) and 5906(3)(1)(C)). This is important because “Congress generally acts intentionally when it uses particular language in one section of a statute but omits it in another.” Dep’t of Homeland Sec. v. MacLean, 574 U.S. 383, 391 (2015) (citation modified).

stated that some of the activities under proposed § 15.10(a)(8) may entail novel risks. Refer to the discussion below on § 15.13 for more about appropriate risk management practices. One commenter stated that the list of enumerated activities in proposed § 15.10(a) is incomplete and risks being read as an exclusive list. The commenter suggested other activities that should qualify, including the facilitation of independently provided customer rewards and benefits, liquidity management, and interaction with third-party protocols or distributed ledger infrastructure. Without additional information, the OCC declines to add the facilitation of independently provided customer rewards as an enumerated activity. The OCC expects liquidity management generally to be permissible as an activity that directly supports issuance, redemption, and the management of reserves. With respect to interaction with third-party protocols or distributed ledger infrastructure, without additional information, the OCC cannot categorically determine whether such activities are permissible in the final rule. However, permitted payment stablecoin issuers may seek additional clarity from the OCC to the extent issuers have questions on the permissibility of an activity. With respect to the list in § 15.10(a) being incomplete, the OCC may amend these regulations over time, including the list of enumerated activities. As discussed in more detail below, in the final rule, the OCC is adopting proposed § 15.10(a)(8), renumbered as § 15.10(a)(11), with a change to explicitly permit the hiring of third parties to engage in certain activities. Third-Party Investment Advisers, Asset Managers, and Separately Managed Accounts Several comments spoke to the permissibility of permitted payment stablecoin issuers hiring third-party investment advisers or asset managers of separately managed accounts, where a custodian controls investment decisions within parameters set by the owner. Some commenters

stated that separately managed accounts can be an operationally prudent tool because they allow reserve assets to remain legally owned and controlled by the issuer while improving transparency and reducing operational risk. Some of these commenters argued these investment advisers and asset managers would directly support the management of reserves and reserves’ liquidity under § 15.10(a)(3) of the proposed rule. Thus, these commenters argued that a stablecoin issuer may hire investment advisers or asset managers under proposed § 15.10(a)(8). One prospective stablecoin issuer asked for confirmation that its particular structure with a third-party reserve manager would be permissible. The OCC agrees that a permitted payment stablecoin issuer may use an investment adviser or asset manager and may use a separately managed account for reserve assets because such arrangements directly support stablecoin issuance and reserve management. Accordingly, the OCC is clarifying in final § 15.10(a)(11) that a permitted payment stablecoin issuer may undertake any other activities, including the hiring of third parties, that directly support any of the activities described in § 15.10(a)(1) through (a)(4). The hiring of third-party investment advisers or asset managers is an example of an activity that is permissible under § 15.10(a)(11) of the final rule. However, such activities should be designed to ensure compliance with the GENIUS Act, 12 CFR part 15, and other applicable laws and regulations. Collateral Trustee Arrangements A few commenters addressed the topic of collateral trustee arrangements. As explained in the preamble to the proposed rule, a collateral trustee arrangement involves a permitted payment stablecoin issuer granting a first-priority security interest in reserve assets to the collateral trustee

for the benefit of stablecoin holders. The proposal asked for comments on whether collateral trustee arrangements would protect the reserve assets. Many commenters responded that the OCC should expressly permit collateral trustee arrangements used solely for the benefit of stablecoin holders. Several of those commenters stated that the rehypothecation prohibition applies to issuer self-dealing in which issuers exploit reserve assets for their own benefit. Those commenters noted that a collateral trustee arrangement is intended to further the purposes behind the prohibition against rehypothecation, in that it exists to ensure that reserves remain available to back outstanding payment stablecoins, protect stablecoin holders, and promote financial stability. Several commenters supported requirements for permitted payment stablecoin issuers to include disclosures for holders related to a collateral trustee arrangement. Commenters advocated for disclosures involving the identity and regulatory status of the trustee, the nature and scope of the security interest, the circumstances in which the trustee may enforce its rights, and any limitations on the issuer’s ability to access or substitute reserve assets. Some commenters also advocated for requirements that issuers obtain express and affirmative consent from holders regarding the collateral trustee structure before purchasing to ensure holders can understand and evaluate the arrangement. The OCC agrees that permitted payment stablecoin issuers may establish such collateral trustee arrangements. These arrangements may have the benefit of protecting payment stablecoin holders by providing a potential mechanism for administration of the reserve assets prior to bankruptcy or receivership. It is possible that such arrangements can facilitate redemptions more quickly than would occur in insolvency or bankruptcy. The OCC plans to continue to evaluate such arrangements to ensure they are serving their intended purpose of protecting payment stablecoin holders. To the extent it becomes clear that such arrangements add uncertainty or do

not adequately protect payment stablecoin holders, the OCC will consider whether such arrangements should continue to be permissible. To effectuate the use of collateral trustee arrangements, the OCC is adding a new § 15.10(a)(9) clarifying that it is permissible for a permitted payment stablecoin issuer to establish a trust arrangement under applicable law for reserve assets, including the granting of a security interest in reserve assets, provided that: (i) any security interest in reserve assets granted to the trustee is for the sole benefit of payment stablecoin holders; (ii) the arrangement with the trustee does not impair the permitted payment stablecoin issuer’s ability to timely redeem payment stablecoins in the normal course of business prior to default; (iii) the arrangement does not introduce claims that would compete with the claims of payment stablecoin holders of payment stablecoins issued by the permitted payment stablecoin issuer in the event of the insolvency of the permitted payment stablecoin issuer; and (iv) the arrangement with the trustee does not impair the ability of a receiver of the permitted payment stablecoin issuer to direct the prompt transfer or liquidation of the reserve assets in order to pay claims to payment stablecoin holders. 44 These conditions are designed to ensure that such arrangements do not compete with the claims of payment stablecoin holders both prior to default as well as following default and that such arrangements are not used to grant security interests on behalf of parties that are not payment stablecoin holders. The OCC is considering whether to issue a separate rulemaking providing further clarity regarding this activity. As part of such a rulemaking, the OCC may consider including additional conditions, such as conditions to clarify the rights that the trust 44 To the extent a permitted payment stablecoin issuer utilizes a collateral trustee arrangement but maintains ownership and control over the reserve assets, the OCC expects that the reserve assets would continue to be reflected on the issuer’s balance sheet rather than on that of the collateral trustee.

agreement must expressly provide to the receiver of, or bankruptcy trustee for, an insolvent With respect to the payment of the trustee in collateral trustee arrangements, it would be a violation of the condition in § 15.10(a)(9)(i) if the trustee were paid from the proceeds of the reserve asset collateral because the trustee holds a security interest in such collateral. The OCC declines to require a disclosure regime for collateral trustee arrangements at this time. Mandating a disclosure regime will not be effective at this point as the practice is nascent and the arrangements may vary extensively, such that mandatory disclosure may not capture the important aspects of such arrangements and could lead to customer confusion or a lack of relevant information. The OCC is also not requiring permitted payment stablecoin issuers to obtain express consent from payment stablecoin holders prior to entering into such arrangements. The OCC believes that the conditions set forth in § 15.10(a)(9)(i) through (iii) are designed to protect payment stablecoin holders and obviate the need to require affirmative consent. Fees Associated with Purchasing or Redeeming In addition to the activities outlined in section 4(a)(7) of the GENIUS Act (12 U.S.C. 5903(a)(7)), for the sake of clarification, proposed § 15.10(a)(5) would have provided that permitted payment stablecoin issuers may assess fees that are associated with the purchasing or redeeming of payment stablecoins. This power is inherent in the activities described above and is explicitly recognized in section 4(a)(1)(B)(ii) of the Act (12 U.S.C. 5903(a)(1)(B)(ii)). One commenter recommended that the OCC confirm expressly that permitted payment stablecoin issuers may charge certain fees to generate revenue, including fees for minting and

burning stablecoins and fees to collect a share of network transaction fees. The commenter recommended that the final rule permit alternate fee structures subject to supervisory review and that the final rule require disclosure of all fee structures. With respect to the commenter’s suggestion about the inclusion of fees, the OCC does not believe further elucidation of this provision is necessary as it is intended to encompass a broad set of fees. The OCC addresses the assessment of fees in non-payment stablecoin digital assets in more detail below. To the extent an issuer has questions regarding whether a fee structure is permissible, it may reach out to the OCC. With respect to the commenter’s concern regarding disclosure of fee arrangements, as discussed below, final § 15.12(e)(1)(iv) requires disclosure of all fees associated with purchasing or redeeming payment stablecoins. Accordingly, the OCC is adopting § 15.10(a)(5) as proposed, which allows permitted payment stablecoin issuers to assess fees associated with purchasing or redeeming payment stablecoins. Acting as Principal or Agent with Respect to Payment Stablecoins The proposed rule, in § 15.10(a)(6), also would have included the permitted activities outlined in section 16(b) of the GENIUS Act (12 U.S.C. 5915(b)), namely acting as principal or agent with respect to any payment stablecoin and paying fees to facilitate customer transactions. 45 Addressing proposed § 15.10(a)(6), one commenter suggested distinguishing between 45 Section 16(b) of the Act provides in part that “Entities regulated by the primary Federal payment stablecoin regulators are authorized to engage in the payment stablecoin activities and investments contemplated by this Act, including acting as a principal or agent with respect to any payment stablecoin and payment of fees to facilitate customer transactions.” 12 U.S.C. 5915(b). The activities authorized under section 16(b) include, for example, acting as an agent for a customer with respect to the redemption of a payment stablecoin issued by a third party.

principal and agent roles and then tying each to capital, liquidity, and operational risk controls. Several commenters also recommended that the OCC recognize activities in which permitted payment stablecoin issuers act as principal or agent with respect to payment stablecoins, either as separately enumerated activities under § 15.10(a), which sets out generally which activities a permitted payment stablecoin issuer may engage in, or as examples of activities that directly support certain activities under proposed § 15.10(a)(8). Commenters cited activities such as limited, risk-controlled principal activities supporting custody, settlement, payment, and liquidity functions; digital wallets and money transmission using payment stablecoins; facilitating customer purchases, sales, or redemptions of payment stablecoins; and holding payment stablecoins as principal to facilitate customer transactions. One commenter suggested addressing these examples in the preamble as published guidance. One commenter cautioned against adding prescriptive limits or conditions on principal or agency activities, arguing that the statute provides the relevant framework and that additional restrictions could narrow the flexibility that Congress intended. Another commenter noted that the OCC correctly does not view section 16(b) as an open-ended grant of authority. With respect to the commenter who suggested distinguishing between principal and agent activities and tying each to capital, liquidity, and operational risk controls, the OCC notes that proposed § 15.10(a) serves a different function than the rule’s risk management requirements (final § 15.13). Section 15.10(a) identifies the activities that are permissible for a permitted payment stablecoin issuer. By contrast, final § 15.13 establishes risk management requirements designed to ensure that such issuers conduct permissible activities in a safe and sound manner. The commenter’s suggestion therefore conflates two related but distinct inquiries: whether an activity is permissible for permitted payment stablecoin issuers; and whether and how the

permitted payment stablecoin issuer may conduct the activity safely in accordance with the relevant risk management-related requirements. With respect to the commenter’s suggestion for the provision of digital wallets and money transmission using payment stablecoins, without additional detail, the OCC cannot definitively say that such activities are permissible. Money transmission is a broad term even if limited to payment stablecoins. To the extent the specific activity qualifies as an activity under § 15.10 (for example, the issuance or redemption of payment stablecoins), it is permissible. With respect to the provision of digital wallets, such an activity may be permissible but might also make the entity a custodian in certain circumstances depending on the scope of related services provided. Refer to the custody discussion below for more detail. The commenter’s proposed activities relating to facilitating purchases or sales of payment stablecoins on customers’ behalf and acting as a customer agent for redemption of a payment stablecoin issued by a third party seem to fit within the enumerated activity in § 15.10(a)(6). Additionally, holding payment stablecoins as principal to facilitate customer transactions likely would also fall under § 15.10(a)(6). With respect to the commenter that cautioned against adding prescriptive limits to § 15.10(a)(6), the OCC is not including any express limits or conditions around the manner in which a permitted payment stablecoin issuer may act as principal or agent in the final rule. However, payment stablecoins are not a permitted reserve asset. One commenter recommended that the final rule confirm permitted payment stablecoin issuers may repurchase their stablecoins in secondary markets. The commenter explained that

issuers may need to do so for several reasons, including stopping runs and managing the balance between circulating supply and holding additional reserve assets. Permitted payment stablecoin issuers may repurchase their stablecoins on secondary markets under proposed § 15.10(a)(6). However, such transactions must not impair the ability of the permitted payment stablecoin issuer to satisfy its statutory redemption obligations or its ability to comply with the capital and liquidity requirements in the final rule. Additionally, any such transactions must otherwise comply with the Act, 12 CFR part 15, and other applicable law. The OCC is finalizing proposed § 15.10(a)(6) without change. Paying Fees to Facilitate Customer Transactions Consistent with section 16(b) of the GENIUS Act (12 U.S.C. 5915(b)), proposed § 15.10(a)(7) would have allowed permitted payment stablecoin issuers to pay fees to facilitate customer transactions (e.g., network or “gas” fees). If an issuer’s payment stablecoin operates on a blockchain that assesses transaction fees, then the issuer may choose to pay transaction fees on behalf of the customer. The OCC recognized in the proposal that if an issuer is paying transaction fees on certain distributed ledgers, the issuer may have to hold non-payment stablecoin digital assets to facilitate the payment of these transaction fees. 46 Similarly, the OCC recognized that the holding of non-payment stablecoin digital assets as principal necessary for testing a distributed ledger is a permissible activity. Relatedly, the OCC solicited comment in the proposal about whether the final rule should explicitly include specific provisions addressing the permissibility of an issuer’s holding of non￾payment stablecoin digital assets to facilitate the payment of transaction fees. 46 See OCC Interpretive Letter 1186 (November 18, 2025).

Several commenters responded that the OCC should explicitly recognize that it may be necessary for permitted payment stablecoin issuers to hold non-payment stablecoin digital assets where they are incidental to, and necessary for, the provision of payment stablecoin services and do not constitute a proprietary trading strategy. Other commenters similarly stated the OCC should allow permitted payment stablecoin issuers to hold limited amounts of non-payment stablecoin digital assets to pay network protocol fees or to conduct testing. On the other hand, one commenter stated that holding non-payment stablecoin digital assets for testing is potentially risky and speculative, and that permitted payment stablecoin issuers should have to seek prior written approval from the OCC. In response to the comments, the OCC is adding new § 15.10(a)(8), which provides that permitted payment stablecoin issuers may hold as principal non-payment stablecoin digital assets as necessary to pay fees, including customer fees and network fees, or to conduct necessary testing on distributed ledger-based platforms, subject to the conditions noted below. The OCC agrees with commenters that these activities should be expressly recognized because paying network fees may be necessary for permitted payment stablecoin issuers to operate and transact on certain blockchains and testing is appropriate to ensure that a permitted payment stablecoin issuer’s systems are functioning as intended. As discussed in more detail below, the conditions the OCC is putting on holding such non-payment stablecoin digital assets obviates the need for a pre-approval process. The OCC also asked in the proposal whether the final rule should include limitations on the amount of non-payment stablecoin digital assets that an issuer may hold at any time. In response, several commenters stated that the final rule should not impose rigid limits on non-payment stablecoin digital asset holdings, with some citing potential future changes in

technology and industry practices that may render rigid limits obsolete. Some commenters recommended instead that the OCC adopt a qualitative, principles-based supervisory approach based around clear internal controls, documentation, and risk management which ensures that non-payment stablecoin digital asset holdings are not commingled with or treated as reserve assets. In contrast, one commenter responded that the OCC should provide more prescriptive and stringent limitations on the holding of non-payment stablecoin digital assets. The commenter recommended that those limits be expressed as both an absolute dollar cap and a percentage and should be subject to regular reporting and examination. One commenter also stated that the amount of non-payment stablecoin digital assets should be capped as necessary for reasonably foreseeable transactions, such as one week of transactions, based on the permitted payment stablecoin issuer’s needs from the last 30 days. In final § 15.10(a)(8), the OCC is requiring that principal holdings of non-payment stablecoin digital assets to pay fees shall not exceed quantities necessary for the reasonably foreseeable conduct of such activities. 47 The OCC declines to set a quantitative limit because the activities of permitted payment stablecoin issuers may vary, and a quantitative limit could be unnecessarily limiting. The OCC would expect that permitted payment stablecoin issuers would consider, among other things, historical data and expected network fees to determine how much non-payment stablecoin digital assets to hold in such a scenario. The OCC intends to evaluate over time whether this limit is appropriate. Final § 15.13 provides the principles-based risk management principles that apply to permitted payment stablecoin issuers, and consistent with 47 The OCC has stated that, as an activity incidental to the business of banking, national banks may pay network fees on blockchain networks to facilitate otherwise permissible activities and hold, as principal, amounts of crypto-assets on balance sheet necessary to pay network fees for which the bank anticipates a reasonably foreseeable need. OCC Interpretive Letter 1186.

those principles and the reserve asset requirements in final § 15.11, permitted payment stablecoin issuers will not be able to commingle or identify non-payment stablecoin digital assets or payment stablecoins as reserve assets. The OCC also solicited comment about whether the final rule should limit the payment methods a permitted payment stablecoin issuer may use to assess fees, including whether the permitted payment stablecoin issuer may assess fees in digital assets other than payment stablecoins. Several commenters responded that the final rule should not limit the methods of payment a permitted payment stablecoin issuer may accept when assessing fees. One such commenter responded that, if the OCC addresses non-fiat fee payments at all, it should be through a principles-based framework focused on transparency, risk management, and control discipline. Another commenter concurred and advocated a flexible, technology-neutral framework under which issuers are required to maintain transparent policies on fee assessment methods and disclose those methods to the OCC. Another commenter stated that the OCC should confirm in either the final rule or in subsequent guidance that a permitted payment stablecoin issuer must have appropriate procedures in place to ensure it can operate in a safe and sound manner if it accepts the payment of fees in the form of non-payment stablecoin digital assets. The OCC declines to limit the methods of payment a permitted payment stablecoin issuer may receive at this time, provided that any such payment complies with applicable laws. As the market evolves, the OCC may reconsider whether certain methods of payment should be impermissible. 48 All permitted payment stablecoin issuers, including those that accept the payment of fees in the form of non-payment stablecoin digital assets, are subject to the risk 48 Any non-payment stablecoin digital asset received would not be a permissible reserve asset.

management requirements set forth in § 15.13. Additionally, the OCC would expect that all permitted payment stablecoin issuers operate in a safe and sound manner regardless of whether they accept payment of fees in the form of non-payment stablecoin digital assets. The OCC notes that, after a permitted payment stablecoin issuer assesses fees in the form of non-payment stablecoin digital assets, the issuer may only hold the collected fees for the purposes outlined in final § 15.10(a)(8), namely, to pay fees or to conduct necessary testing on distributed ledger-based platforms. To the extent a permitted payment stablecoin issuer holds non-payment stablecoin digital assets in excess of the amount necessary for the activities set forth in final § 15.10(a)(8), the OCC would expect that the issuer divest of such assets as soon as practicable. 49 Managing Foreign Exchange Risk Several commenters recommended that the OCC recognize that permitted payment stablecoin issuers that issue non-U.S. dollar-denominated stablecoins may engage in foreign exchange risk management as a permitted activity. Some of those commenters characterized the permissible foreign exchange risk management activities as conditional upon or related to the issuance of non-U.S. dollar-denominated stablecoins, while one commenter recommended the OCC allow broader powers related to foreign exchange risk management if the final rule permits non-U.S. dollar-denominated stablecoins and narrower powers if the final rule does not permit non-U.S. dollar-denominated stablecoins. Several commenters distinguished these foreign exchange management activities from purely speculative trading activities, while two such 49 The OCC would expect that most permitted payment stablecoin issuers should be able to divest of any such excess non-payment stablecoin digital assets within one business day. In recent conditional approvals for national banks, applicants have converted digital assets received to fiat currency within one business day or held such assets for another permissible purpose. See Conditional Approval 1366, Conditional Approval 1362, Conditional Approval 1353.

commenters recommended explicit prohibitions on speculative activities and regulatory controls to discourage speculation. One commenter recommended against rigid supervisory rules or capital add-ons for foreign exchange risk in favor of expectations of safe and sound controls including board￾approved risk appetites and independent risk oversight. One commenter recommended that foreign exchange risk management be understood as a tool to meet permitted payment stablecoin issuer reserve and redemption requirements, rather than insulating payment stablecoin holders from fundamental currency risk and recommended that any requirements imposed by the OCC focus on such reserve and redemption requirements rather than rigid limits or capital add-ons that constrain legitimate hedging activities. The OCC agrees with commenters that engaging in foreign exchange risk management should be a permissible activity. Specifically, the definition of payment stablecoin in section 2(22) of the Act (12 U.S.C. 5901(22)) specifies that a payment stablecoin is a digital asset that the issuer “is obligated to convert, redeem, or repurchase for a fixed amount of monetary value.” Additionally, under section 2(17) of the Act (12 U.S.C. 5901(17)), “monetary value” means “a national currency or deposit . . . denominated in a national currency.” These provisions may reasonably be read to indicate that payment stablecoins are not necessarily limited to U.S. dollar￾denominated stablecoins because it suggests that issuers may issue payment stablecoins backed by other types of national currencies. However, the list of permissible reserve assets that issuers may hold are generally U.S. dollar- or U.S. government-based reserve assets. Accordingly, to the extent that a permitted payment stablecoin issuer seeks to issue a non-U.S. dollar-denominated payment stablecoin, it could incur substantial foreign exchange risk or else be limited to using a very narrow subset of reserve assets.

Such foreign exchange risk would make it difficult for the issuer to ensure that it is able to meet the requirements of § 15.11 and § 15.13. The OCC therefore believes that managing foreign exchange risk is a permissible activity under managing reserves related to the issuance or redemption of payment stablecoins under § 15.10(a)(3) and is permissible under final § 15.10(a)(11) as an activity that directly supports the activities in § 15.10(a)(1) through (a)(3). The OCC is providing in new § 15.10(a)(10) of the final rule that permitted payment stablecoin issuers may manage foreign exchange risk. However, permitted payment stablecoin issuers that manage foreign exchange risk are subject to the risk management requirements in § 15.13(a)(10) of the final rule. Those requirements impose conditions on foreign exchange risk management such as requiring that a permitted payment stablecoin issuer must not use foreign exchange risk management as a means to speculate, including with respect to the appreciation or depreciation of any national currency. Other Suggested Activities or Requests for Interpretations Separate from the specific activities enumerated in proposed § 15.10(a)(1) through (7), several commenters suggested additional activities that should be considered permissible activities. For example, one commenter recommended that the enumerated list include treasury management functions, including short-term investment-optimization among permissible reserve assets subject to diversification and concentration limits. Another commenter recommended that the OCC recognize treasury management activities for reserve asset management within a non￾exhaustive list of examples of activities that qualify under proposed § 15.10(a)(8) as directly supporting core activities.

At this time, the agency is not adding treasury management to the list of permissible activities enumerated in § 15.10(a). The OCC notes that aspects of treasury management, including short-term investment optimization, are already included under § 15.10(a)(3), which allows permitted payment stablecoin issuers to manage reserves related to the issuance or redemption of payment stablecoins. Additionally, with respect to treasury management functions that are not encompassed by that provision, such functions may qualify under final § 15.10(a)(11) as activities that directly support the activities in § 15.10(a)(1) through (a)(4). The OCC declines to specifically add “treasury management” to the enumerated list of activities because that term is not clearly defined and could be read broadly, and therefore, the OCC would need to evaluate the specific treasury management functions a permitted payment stablecoin issuer proposes to engage in to determine whether they are permissible under the final rule. For example, treasury management activities conducted to ensure liquidity to meet payroll demands and to pay business expenses incurred as a result of conducting payment stablecoin activities directly support core permitted payment stablecoin issuer activities and are permissible. The OCC invites permitted payment stablecoin issuers to seek clarification from the OCC as to whether a particular activity is permissible. One commenter recommended that the OCC add to the enumerated permissible activities list customer onboarding, identity verification and compliance functions reasonably necessary to support permitted payment stablecoin issuer operations. Another commenter recommended that the OCC recognize onboarding processes as an item in a non-exhaustive list of examples of activities that qualify under § 15.10 as directly supporting core activities.

The agency declines to include customer onboarding, identity verification, and compliance functions in the list of permissible activities enumerated in § 15.10(a) at this time. As explained below, § 15.12 provides that a permitted payment stablecoin issuer’s obligation to redeem does not begin until, among other things, the customer has been successfully onboarded. Accordingly, because the OCC addresses onboarding in § 15.12 of the final rule, the OCC does not believe it needs to specifically include onboarding as an enumerated activity. Permitted payment stablecoin issuers may onboard customers, so long as the onboarding complies with the Act, 12 CFR part 15, and other applicable laws, including AML/CFT laws and regulations and economic sanctions obligations. Several commenters recommended the OCC add various specific interpretations to the final rule. One commenter recommended that the OCC clarify whether non-hosted or external wallets are permissible for a permitted payment stablecoin issuer and to set clear boundaries to keep payment control within regulated entities. Another commenter recommended that the OCC prohibit regulated entities from hosting or transacting with self-custody wallets due to money laundering concerns. 50 The Act does not specifically prohibit self-custody or non-hosted wallets. The OCC declines to explicitly prohibit the use of such wallets by permitted payment stablecoin issuers but notes that the use of such wallets must comply with the requirements of the Act, 12 CFR part 15, and other applicable laws. For example, permitted payment stablecoin issuers that use such wallets still must comply with section 4(a)(6) of the Act (12 U.S.C. 5903(a)(6)), which provides that a permitted payment stablecoin issuer may issue payment stablecoins only if the issuer has 50 As discussed below, self-custody generally refers to holding one’s own assets directly even though technically no custody service is provided in such an arrangement.

the technological capability to comply, and will comply, with the terms of any lawful order. Additionally, permitted payment stablecoin issuers must comply with all applicable AML/CFT laws and regulations and economic sanctions obligations. One commenter recommended that the OCC require permitted payment stablecoin issuers to use a formally defined wallet credential state machine describing the status of the wallet, explicit permitted and prohibited transactions, cryptographic wallet binding, compliance￾gated activation preconditions, automatic cascading orders to force wallet compliance and freezing, and regulated credential expiration. The OCC declines to mandate particular technical requirements for permitted payment stablecoin issuers that are not required under the Act, consistent with 12 CFR part 15’s generally technology-neutral approach. The OCC will not mandate the specific technical requirements in light of the continued evolution of the stablecoin industry and the likelihood that any technical requirements may become obsolete and potentially stifle innovation. However, the final rule in § 15.13 contains risk management requirements, including those related to information technology and security, which could implicate some of the commenter’s suggestions. The OCC will continue to assess permitted payment stablecoin issuers’ compliance with such risk management requirements against the potential risks posed to issuers throughout the supervisory process. Prohibited Activities Deceptive Names and Marketing In proposed § 15.10(c)(1), the OCC would have imported the prohibition on the use of deceptive names from section 4(a)(9) of the GENIUS Act (12 U.S.C. 5903(a)(9)). This provision

would have prohibited a permitted payment stablecoin issuer from using any combination of terms relating to the United States Government, including “United States,” “United States Government,” and “USG,” in the name of the payment stablecoin. This prohibition would not have applied to abbreviations relating directly to the currency to which the payment stablecoin is pegged, such as “USD.” Consistent with section 4(a)(9) of the GENIUS Act (12 U.S.C. 5903(a)(9)), proposed § 15.10(c)(2) would have prohibited permitted payment stablecoin issuers from marketing a payment stablecoin in such a way that a reasonable person would perceive the payment stablecoin to be legal tender as described in 31 U.S.C. 5103, issued by the United States, or guaranteed or approved by the Government of the United States. The OCC recognized that permitted payment stablecoin issuers may want to market themselves as permitted payment stablecoin issuers under the GENIUS Act. There is no prohibition against issuers marketing themselves in this manner, so long as they do not run afoul of the prohibitions outlined in the Act and § 15.10(c)(1) and (2), including the prohibition against marketing a payment stablecoin in such a way that a reasonable person would perceive the payment stablecoin to be guaranteed, issued, or approved by the United States. The OCC noted that misrepresentations by a permitted payment stablecoin issuer cannot be cured by a general disclaimer and that representations and disclosures should be clear to payment stablecoin holders and customers. The OCC did not receive any comments specifically requesting changes to § 15.10(c)(1) and (c)(2) and is therefore adopting § 15.10(c)(1) and (c)(2) as proposed. Refer to the discussion of § 15.12 for additional disclosure requirements that are related to the prohibition in § 15.10(c)(2).

Eligibility for Deposit Insurance
Consistent with section 4(e) of the GENIUS Act (12 U.S.C. 5903(e)), proposed § 15.10(c)(3) would have provided that a permitted payment stablecoin issuer may not directly or through implication represent that payment stablecoins are backed by the full faith and credit of the United States, guaranteed by the United States Government, or subject to Federal deposit insurance or Federal share insurance. Two commenters recommended that the OCC explicitly codify that payment stablecoin holders are not eligible for deposit insurance, including on a pass-through basis. One commenter noted that this clarification would prevent issuers from implying “insured-like” status that could foster false confidence and increase run risk. As discussed in more detail below, the OCC is adding disclosure requirements in § 15.12(e) that provide that a permitted payment stablecoin issuer must include in its redemption disclosures that payment stablecoins are not deposits, not backed by the full faith and credit of the United States, not subject to deposit insurance by the FDIC, and not subject to share insurance by the NCUA. The OCC declines to opine on pass-through insurance in this rulemaking as that topic is subject to the FDIC’s notice of proposed rulemaking that has not yet been finalized. 51 The OCC is adopting § 15.10(c)(3) as proposed. 52 Yield 51 GENIUS Act Requirements and Standards for FDIC-Supervised Permitted Payment Stablecoin Issuers and Insured Depository Institution, 91 FR 18534 (Apr. 10, 2026). 52 In addition, the OCC notes that, if a permitted payment stablecoin issuer markets any products other than payment stablecoins, it shall also be subject to the prohibition in section 4(e)(3) of the GENIUS Act (12 U.S.C. 5903(e)(3)), which provides that it shall be unlawful to market a product in the United States as a payment stablecoin unless it is issued pursuant to the GENIUS Act.

Consistent with section 4(a)(11) of the GENIUS Act (12 U.S.C. 5903(a)(11)), proposed § 15.10(c)(4) provided that a permitted payment stablecoin issuer must not pay the holder of any payment stablecoin any form of interest or yield (whether in cash, tokens, or other consideration) solely in connection with the holding, use, or retention of such payment stablecoin. The OCC noted that issuers might attempt to make prohibited payments of interest or yield to payment stablecoin holders through arrangements with third parties. The OCC also noted that there would likely be a large and changing variety of arrangements with third parties in which issuers could achieve the payment of yield to payment stablecoin holders. The OCC stated that it would not be possible to identify in detail all, or even most, of the potential arrangements between permitted payment stablecoin issuers and third parties that the OCC may prohibit under section 4(a)(11) of the GENIUS Act and the OCC’s rulemaking authority under section 4(h) of the GENIUS Act, 53 particularly as such arrangements may evolve over time. On the other hand, the OCC noted that a rule with only a general prohibition on the payment of yield could create uncertainty within the payment stablecoin market. The OCC therefore proposed to include a presumption in paragraph (c)(4)(i) that certain types of arrangements with certain types of persons would be prohibited payments of yield or interest by the issuer. Specifically, the OCC would have presumed that a permitted payment stablecoin issuer is paying the holder of any payment stablecoin any form of interest or yield (whether in cash, tokens, or other consideration) solely in connection with the holding, use, or retention of such payment stablecoin if: (A) the permitted payment stablecoin issuer has a contract, agreement, or other arrangement with an affiliate or a related third party to pay interest 53 See 12 U.S.C. 5903(h) (providing that the OCC and other payment stablecoin regulators may issue regulations to “carry out the requirements of [section 4], including to establish conditions, and to prevent evasion thereof”).

or yield to the affiliate or related third party; and (B) the affiliate 54 or related third party (or affiliate of such related third party) has a contract, agreement, or other arrangement to pay interest or yield (whether in cash, tokens, or other consideration) to a holder of any payment stablecoin issued by the permitted payment stablecoin issuer solely in connection with the holding, use, or retention of such payment stablecoin. To the extent that the person, or an affiliate of the person with whom the permitted payment stablecoin issuer had a contract, agreement, or other arrangement to pay interest or yield was a related third party of the permitted payment stablecoin issuer because the permitted payment stablecoin issuer issues payment stablecoins on the related third party’s behalf or under the related third party’s branding, the arrangement between the related third party and the holder of the payment stablecoin would have considered the holder of the payment stablecoin to be the holder of the payment stablecoin issued by the permitted payment stablecoin issuer on the related third party’s behalf or under the related third party’s branding. With respect to a white-label relationship, the rebuttable presumption would have been triggered only to the extent the payment stablecoin holder was a holder of the related third party’s white-labeled stablecoin (as opposed to other payment stablecoins issued by the permitted payment stablecoin issuer). Related third parties were defined to include any person offering to pay interest or yield to payment stablecoin holders as a service (i.e., on behalf of the permitted payment stablecoin issuer) and any person that the issuer issues payment stablecoins on behalf of or under the branding of (i.e., persons that have entered into a white-label relationship with the issuer). Under the proposed rule, a permitted payment stablecoin issuer would have been able to rebut the presumption by submitting written materials that, in the OCC’s judgment, demonstrate 54 A person would not have been included within this second prong solely because the person is an affiliate of an affiliate of the issuer.

that the contract, agreement, or other arrangement is not prohibited under § 15.10(c)(4) and is not an attempt to evade the prohibition. The OCC received many comments concerning the prohibition against a permitted payment stablecoin issuer or foreign payment stablecoin issuer paying the holder of any payment stablecoin any form of interest or yield (whether in cash, tokens, or other consideration) solely in connection with the holding, use, or retention of such payment stablecoin (“the yield prohibition”). As discussed in greater detail below, after reviewing the comments, the OCC has determined to eliminate the rebuttable presumption from the final rule. Commenters held diverging views on the proposal’s implementation of the yield prohibition and associated rebuttable presumption. Many advocated eliminating the rebuttable presumption. A large number advocated interpreting the yield prohibition narrowly and not applying the prohibition or associated rebuttable presumption to certain indirect payments, to payments based on transactions, or to payments to intermediaries (rather than payment stablecoin holders) made not solely in connection with the holding, use, or retention of a payment stablecoin. On the other hand, a substantial number of commenters advocated for a broadly applicable yield prohibition that captured indirect payments, transaction-based payments, and payments where holding, using, or retaining a payment stablecoin was a necessary condition of receiving payment. Many of these commenters advocated expanding the scope of the rebuttable presumption. Additional detail on these comments and other comments received is below. Several commenters stated that the statutory yield prohibition is not yet settled, noting ongoing legislation that could interact with the GENIUS Act’s prohibition. Unless and until such legislation passes, the OCC must implement the GENIUS Act’s yield prohibition, as enacted. If the GENIUS Act is amended, or legislation that clearly relates to the GENIUS Act’s yield

prohibition passes, the OCC will evaluate whether any amendments to the final rule are necessary and appropriate to give effect to such legislation. A few commenters advocated eliminating the yield prohibition from the final rule altogether. One commenter advocated allowing issuers to peg payment stablecoins to a fixed amount of purchasing power, arguing that doing so would not amount to paying any form of interest or yield (whether in cash, tokens, or other consideration). Eliminating the prohibition would be inconsistent with the requirements of section 4(a)(11) of the GENIUS Act (12 U.S.C. 5903(a)(11)), and the definition of payment stablecoin in
section 2(22) of the Act (12 U.S.C. 5901(22)), which hinges on an issuer being obligated to
convert, redeem, or repurchase a payment stablecoin for a fixed amount of monetary value (rather than a fixed amount of purchasing power). The OCC therefore is not revising the rule in response to these comments. One commenter requested that the OCC confirm that the yield prohibition does not capture interest paid on deposits, including tokenized deposits. The OCC confirms that the GENIUS Act’s yield prohibition does not apply to deposits. The definition of payment stablecoin in section 2(22) of the Act (12 U.S.C. 5901(22)) explicitly excludes deposits, regardless of whether the deposit is recorded using distributed ledger technology. Because the yield prohibition in section 4(a)(11) of the Act (12 U.S.C. 5903(a)(11)) applies to holders of payment stablecoins solely in connection with the holding, use, or retention of payment stablecoins, the prohibition does not extend to paying interest on deposits, including deposits in tokenized form. Several commenters stated that the proposed yield prohibition and associated rebuttable presumption were too broad and exceeded the OCC’s authority. One stated that the rebuttable

presumption could raise issues under the major questions doctrine. One commenter stated that disclosures revealing the economic substance of arrangements between issuers, affiliates, and third parties would be more effective than the rebuttable presumption. Commenters also stated that the rebuttable presumption would invert the burden of proof, chill competition, and discriminate against savers in favor of borrowers. Commenters stated that the statutory prohibition applies to permitted payment stablecoin issuers and foreign payment stablecoin issuers and does not speak to payments from other entities or payments made by other persons in the secondary market. Several of these commenters noted that, unlike the prohibition against pledging, rehypothecating, or reusing reserve assets in section 4(a)(2) of the GENIUS Act (12 U.S.C. 5903(a)(2)), the prohibition in section 4(a)(11) of the Act (12 U.S.C. 5903(a)(11)) does not contain language explicitly prohibiting a permitted payment stablecoin issuer or foreign payment stablecoin issuer from indirectly engaging in activities that are proscribed for the issuer. Many of these commenters stated that the yield prohibition was intensely debated by Congress and that the final text of the Act reflects a considered decision not to prohibit indirect payments. Some of these commenters argued that any indirect payments should be permitted while others took a narrower view, arguing that payments made at the direction of, or on behalf of, the issuer should be prohibited while payments made by third parties that are not controlled by, or made pursuant to an agreement with, the issuer should be permitted. Some commenters stated that independently funded rewards paid by affiliates or third parties should be permitted under certain circumstances. 55 Many of the commenters that advocated for a narrow prohibition 55 Different commenters suggested a variety of potential conditions. Several commenters proposed including conditions that would require (1) the issuer not to control the decision to pay interest or yield, (2) the non-issuer to independently fund payments to payment stablecoin holders, and (3) the non-issuer to not have an agreement with the issuer to pay interest or yield. Some commenters additionally focused on whether the economics of any arrangement suggest that the issuer passes interest or yield earned on reserve assets though a non-issuer to payment

stated that the OCC could not use its anti-evasion authority under section 4(h)(1) of the Act (12 U.S.C. 5903(h)(1)) to adopt a rebuttable presumption. These commenters argued that, since the statutory prohibition does not apply to indirect payments, some or all indirect payments should not be considered evasion. These commenters stated that the anti-evasion provisions of the Act should capture bad-faith arrangements, including arrangements where an issuer actually directs a third party to make a payment on the issuer’s behalf. 56 Some commenters also stated that the anti-evasion language appears in section 4(h)(1) of the Act (12 U.S.C. 5903(h)(1)) and should be read to prevent the evasion of section 4’s (12 U.S.C. 5903) requirements rather than to expand section 4(a)(11)’s (12 U.S.C. 5903(a)(11)) yield prohibition. With respect to this last point, section 4(h)(1) of the Act (12 U.S.C. 5903(h)(1)) states that “the primary Federal payment stablecoin regulators shall . . . issue such regulations relating to permitted payment stablecoin issuers as may be necessary to establish a payment stablecoin regulatory framework necessary to administer and carry out the requirements of this section [(section 4)], including to establish conditions, and to prevent evasion thereof.” The yield prohibition in section 4(a)(11) (12 U.S.C. 5903(a)(11)) is a requirement of section 4 and thus subject to the anti-evasion provisions of the GENIUS Act by the Act’s own terms. Although the OCC is eliminating the rebuttable presumption from the final rule, the OCC emphasizes that the OCC retains its authority to address evasion of section 4 of the Act (12 U.S.C. 5903), including the yield prohibition. stablecoin holders. Some commenters believed that the non-issuer should not be an affiliate whereas others believed that payments to and from affiliates should not be prohibited by the yield prohibition. One commenter stated that the yield prohibition is the functional descendant of Regulation Q, which permitted independent distributors to offer incentives to attract or retain customers. 56 One commenter stated that the rebuttable presumption should be used as a focused tool to address bad-faith evasions but that the OCC should explicitly carve certain other arrangements from the scope of the presumption.

Many commenters advocated a broad prohibition that would capture indirect payments as well as direct payments. Some of these commenters advocated capturing additional types of transactions through the rebuttable presumption, including transactions involving indirect payments through persons with whom the issuer has a financial interest, contractual relationship, or business arrangement. Others advocated for a flat prohibition on direct and indirect payments, rather than employing a rebuttable presumption. These commenters stated that preventative measures, such as a broad prohibition, would be preferable to reactive measures, like the rebuttable presumption. Several of these commenters characterized indirect payments as a loophole that must be closed, either by regulatory action or Congressional action. Many of the commenters favoring a broad prohibition stated that permitting indirect payments could lead to deposit flight that would disproportionately affect community banks and reduce lending. One commenter stated that clear and enforceable treatment of the yield prohibition could reduce uncertainty around asset-liability dynamics and help preserve the intended protection provided by 1 to 1 reserve backing and the timely redemption obligation. The statutory yield prohibition can capture certain payments that commenters characterized as indirect payments. A person may pay another person through someone else and thus be within the scope of the yield prohibition. For example, interest or yield payments to payment stablecoin holders made by an agent of the permitted payment stablecoin issuer or foreign payment stablecoin issuer on the issuer’s behalf solely in connection with the holding, use, or retention of a payment stablecoin would be within the scope of the prohibition. In these instances, the agent acts for the issuer. The issuer pays interest or yield to a payment stablecoin holder. Even if the issuer were not considered to be the payor, it would clearly evade the statutory prohibition on yield for an issuer to merely pay another entity to make an interest or

yield payment that the issuer could not make directly. As discussed below, other scenarios may present closer questions. For example, indirect payments that are not made solely in connection with the holding, use, or retention of a payment stablecoin are outside the scope of the prohibition by the Act’s own terms. Depending on the facts and circumstances, a payment to payment stablecoin holders through an intermediary might be made solely in connection with the holding, use, or retention of a payment stablecoin or might be made, at least in part, for other reasons. One commenter stated that issuers should be permitted to pass yield from reserves through to institutional payment stablecoin holders but not to retail payment stablecoin holders. The GENIUS Act does not distinguish between retail and institutional payment stablecoin holders. Accordingly, the final rule applies the yield prohibition equally to payments by an issuer to institutional and retail payment stablecoin holders. One commenter requested that the OCC provide a cure period for violations of the yield prohibition. The final rule does not include such a cure period but, as discussed below, does not include the rebuttable presumption. The OCC will exercise its enforcement discretion appropriately, based on the given facts and circumstances. Commenters requested clarification about the various prongs of the rebuttable presumption, the process for rebutting the presumption (including standardized rebuttal language), and the particular wording of the presumption (e.g., the definition of “related third party”). Commenters also requested a list of illustrative examples of arrangements that would not violate the prohibition. Because the final rule does not include the rebuttable presumption, the OCC is not further clarifying the terms of the presumption or the process for rebuttal. In response to requests for examples of activities that would violate or be permitted under the yield

prohibition or that would be captured by the presumption or constitute evasion, the OCC is not including a list of prohibited or permitted arrangements. Rather, the OCC will apply the language of the statute to the facts and circumstances of any particular arrangement so that any such arrangement can be evaluated based on all relevant facts and circumstances. Commenters addressed a number of potential safe harbors or exclusions for certain activities. Some commenters stated that there should be a de minimis exemption for small payments or incidental payments that do not scale with the amount of payment stablecoins held by the payee. These commenters stated that such small payments pose no credible risk of evasion of the GENIUS Act and that subjecting these small payments to the rebuttable presumption would impose disproportionate burdens. Other commenters disagreed, stating that such a safe harbor or exclusion would be unnecessary and unsupported by the statute. The OCC is not adopting a safe harbor for de minimis payments because the statutory yield prohibition, by its terms, does not contemplate an exemption for such payments. Some commenters argued that the GENIUS Act was not intended to prohibit existing rewards programs and that rewards programs that were in existence as of the enactment of the GENIUS Act should be excluded from the statutory yield prohibition. Many commenters argued for an explicit safe harbor for these indirect payments or for excluding them from the scope of the rebuttable presumption. The OCC declines to presume that rewards programs that predated the GENIUS Act comply with the GENIUS Act. The fact that Congress may have had notice of these rewards programs does not necessarily imply that Congress endorsed them as permissible. Indeed, Congress could have provided a safe harbor for such programs but did not do so. Accordingly, rewards programs that predate the enactment of the GENIUS Act will be evaluated

the same as rewards programs that are established after the enactment or effective date of the GENIUS Act. Many commenters argued that the prohibition and associated rebuttable presumption should not capture payments that the issuer does not control and that are not funded directly by the issuer. Commenters requested specific exclusions or safe harbors for fiduciary income earned by trust entities, certain DeFi arrangements, payments in connection with the promotion or distribution of payment stablecoins, rewards from staking, and interest from lending. Several commenters advocated for specific exclusions or safe harbors for various types of white-label arrangements. Commenters also requested exclusions or safe harbors for certain arrangements subject to Federal securities laws, customer loyalty or rewards programs structured in good faith, and payments for services (including compliance, technological, operational, marketing, or distributional services). In response to comments, the OCC has not provided a general safe harbor. With respect to DeFi arrangements, the facts of each DeFi arrangement may bear significantly on whether such an arrangement is entered into to evade the yield prohibition. The OCC is also not adopting an explicit safe harbor for payments made for services. Absent additional facts to the contrary, payments for bona fide services generally would not be prohibited because such payments generally are not interest or yield paid solely in connection with the holding, use, or retention of a payment stablecoin. The OCC also has not adopted a safe harbor for arrangements subject to the Federal securities laws. Although payment stablecoins are excluded from the definition of security, an arrangement where an issuer pays interest or yield solely in connection with the holding, use, or

retention of payment stablecoins could be a security, depending on the facts and circumstances. The statute does not provide a clear safe harbor from the yield prohibition for securities. Accordingly, the OCC declines to adopt a safe harbor for arrangements that are securities. The OCC also is not adopting a safe harbor for white-label partners. Payments to and from white-label partners may be more likely to be made on behalf of a permitted payment stablecoin issuer or foreign payment stablecoin issuer than other types of payments. Accordingly, the OCC believes that a broadly applicable safe harbor would be inappropriate. Many commenters stated that the key terms used in the prohibition and associated rebuttable presumption must be defined or clarified. Some argued that failing to include definitions for these terms violated the OCC’s notice-and-comment obligations under the Administrative Procedure Act. Others stated that the terms were sufficiently clear and did not require further definition. As discussed below, the OCC has decided not to include additional regulation text defining certain terms used in the yield prohibition, with the exception of the term “payment stablecoin holder,” discussed elsewhere. The OCC believes that it is not necessary to do so and that including definitions for certain terms could encourage the adoption of arrangements that are intended to evade the prohibition. A large number of commenters stated that “interest” and “yield” should be defined. Several commenters favoring a broad yield prohibition stated that these terms should be interpreted broadly. Commenters noted that the prohibition in section 4(a)(11) of the GENIUS Act (12 U.S.C. 5903(a)(11)) applies to the payment of “any form of interest or yield, whether in cash, tokens, or other consideration” and stated that this language suggests that the terms “interest” and “yield” should be interpreted broadly. Several commenters stated that “interest”

should include all scenarios where an issuer provides economic value to a partner or affiliate who then delivers yield-like benefits to payment stablecoin holders. Many commenters stated that the definitions of “interest” and “yield” should hinge on economic substance and not on how the term is labeled (e.g., as rewards). Many commenters stated that interest should be defined to mean economic benefits that scale with the amount of payment stablecoins that a stablecoin holder holds or the duration that the stablecoin holder holds the payment stablecoins. Some commenters stated that the terms interest and yield should include payments by an issuer based on the passive holding of a payment stablecoin. Some commenters noted that interest has long been interpreted to refer to a wide range of types of compensation and that the Supreme Court has rejected the notion that interest must be time- or rate-based. Commenters stated that, since the GENIUS Act prohibits yield, in addition to interest, the OCC should interpret the prohibition broadly. Several commenters stated that a broad definition of interest and yield, as part of a broad prohibition, would help maintain the distinction between payment instruments, like payment stablecoins, and investment instruments. In contrast, many commenters that favored a narrow yield prohibition advocated excluding certain types of payments from the definitions of interest and yield. One stated that the OCC should not prohibit arrangements that are the economic equivalent of paying any form of interest or yield (whether in cash, tokens, or other consideration), arguing that, if the OCC commits to regulating economic equivalents, rather than statutory categories, there is no principled stopping point. The OCC disagrees. Interest and yield are broad terms under their generally understood meanings. Interest does not stop being interest merely because it is given a different name. An approach that looked to labels rather than economic substance would render the yield prohibition meaningless.

Other commenters requested carveouts (either from the definition of interest or yield, the scope of the prohibition, or through the implementation of a safe harbor) for certain commercial transactions, fee waivers, promotional or loyalty payments, merchant discounts and rebates (subject to certain requirements), white-label profit sharing, and transaction-based payments. Many of these comments focused on the idea that transaction-based rewards should not be considered interest or yield. Commenters disagreed as to whether customer rewards should be included within the definition and thus be subject to the yield prohibition. Commenters advocating a broad yield prohibition stated that rewards programs could act as an evasion of the prohibition, rewards would blur the line between payment and investment instruments, and excluding rewards from the scope of the prohibition could negatively impact competition between highly regulated banks and less regulated entities. Others stated that certain types of rewards (e.g., transaction-based rewards or independently funded third-party rewards, discussed above) should not be considered interest or yield. After considering the comments received, the OCC has decided not to define the terms “interest” or “yield.” The OCC will apply principles of statutory interpretation to the terms in light of the facts and circumstances before it. The OCC therefore declines to adopt a definition of these terms. Several commenters stated that “pay” should be interpreted broadly and that the OCC should look to the economic substance of a transaction to determine whether a payment has occurred. In contrast, in the context of the rebuttable presumption, one commenter said that the OCC should not interpret the term to capture any transfer of economic value, arguing that doing so would expand the OCC’s authority and would cover general commercial relationships. The OCC is not defining the term in the final rule. The OCC will apply principles of statutory

interpretation to the term “pay” in light of the facts and circumstances before it. Commenters had diverging views on whether and how to define “holding,” “use,” and “retention” for the purpose of implementing the statutory yield prohibition. Many commenters advocated for excluding transactional activities from the scope of “use” altogether, stating that the prohibition should apply to passive holding of payment stablecoins rather than active use of payment stablecoins. These commenters argued that the use of the terms “interest” and “yield” suggest that the prohibition applies to passive holdings and that the word “use” is intended merely to ensure that an issuer cannot evade the prohibition by mislabeling payments for passive holdings. Several commenters requested that the OCC clarify that “use” refers to bona fide customer-facing activity rather than ministerial issuance, redemption, settlement, or internal asset-transfer functions. Other commenters stated that the terms should be read broadly, such that payments that are conditioned on holding, using, or retaining a stablecoin are captured. The statutory yield prohibition applies to payments of interest or yield solely in connection with the holding, use, or retention of a payment stablecoin. Thus, the statute contemplates that certain payments made in connection with the use of a payment stablecoin may be prohibited. Specifically, a payment would need to (a) be interest or yield and (b) be made solely in connection with the holding, use, or retention of a payment stablecoin to be within the scope of the prohibition. Transaction-based payments that did not amount to interest or yield or that were not made solely in connection with the holding, use, or retention of a payment stablecoin would not be prohibited. Whether a transaction-based payment meets those criteria is a fact-specific inquiry, and the OCC will address the facts presented by particular arrangements as they arise.

Commenters had diverging views as to the meaning of the term “solely” in the yield prohibition. Several commenters stated that the term must remain in the prohibition, should be included in the rebuttable presumption, if retained, and should be given the effect of excluding payments made even in part based on factors other than the holding, use, or retention of payment stablecoins. Commenters stated, for example, that payments made for commercial purposes, including marketing payments, payments for liquidity provision, and the posting of collateral should be outside the scope of the prohibition because they are not made solely in connection with the holding, use, or retention of a payment stablecoin. Commenters also stated that payments made in connection with serving as a node, validating transactions, and staking are not made solely in connection with the holding, use, or retention of payment stablecoins. Some commenters stated that giving effect to the term “solely” would help distinguish payment instruments and investment products. A large number of other commenters stated that the term “solely” should be read narrowly to prevent evasion of the yield prohibition. These commenters emphasized that the term should be read in the broader context of the prohibition, which prohibits a permitted payment stablecoin issuer or foreign payment stablecoin issuer from paying any form of interest or yield (whether in cash, tokens, or other consideration) solely in connection with the holding, use, or retention of such payment stablecoin. Some commenters stated that the yield prohibition should capture the transfer of economic benefit to a payment stablecoin holder unless the person providing the benefit can demonstrate by clear and convincing evidence that the purpose of the payment is for a substantial business purpose other than incentivizing, or otherwise making payments in connection with, the holding, use, or retention of a payment stablecoin. Similarly, another commenter stated that an economic benefit provided to a holder or user of a payment

stablecoin should be presumed to be provided solely in connection with the holding, use, or retention of that stablecoin if holding, using, or retaining the stablecoin is a necessary condition to receiving the benefit or is the reason the benefit is provided. The word “solely” in the statutory yield prohibition is best read under its plain terms to exclude payments made in connection with reasons other than holding, using, or retaining a payment stablecoin. Thus, payments made for other purposes are not barred by the GENIUS Act. To the extent that there are concerns that a permitted payment stablecoin issuer pays interest or yield only nominally for another purpose in an attempt to evade the statute, the OCC will look to the substance of the transaction to determine whether the permitted payment stablecoin issuer was truly paying solely in connection with the holding, use, or retention of a payment stablecoin or whether the transaction was structured for the purpose of evading the yield prohibition. Commenters had widely varying views on the economic impact of the yield prohibition. A large number of commenters stated that the economic impact of a prohibition that allowed for indirect payments would be significant. These commenters stated that the promise of interest- or yield-bearing payment stablecoins could divert funds away from bank deposits (particularly at community banks) and diminish lending and the provision of financial services and investments within communities. Several of these commenters noted that community banks are important sources of loans, particularly for smaller communities and for farmers. These commenters stated that the scale of deposit flight would depend on the strength of the yield prohibition and the growth of the payment stablecoin industry. Specific estimates varied, but many of these commenters cited to reports that deposits could be reduced by trillions of dollars and that lending could decrease by hundreds of billions of dollars, with certain States being more impacted than

others. 57 Several commenters favoring a narrow prohibition criticized these estimates, including by arguing that some of these estimates represented advocacy, rather than research, stating that some of the estimates were inconsistent with past statements of the organizations that produced the estimates, and by questioning the applicability of the assumptions or models used to create these estimates. Many of these commenters stated that deposits would likely be recycled back into community banks in the form of reserve assets. A number of commenters favoring a broad prohibition disagreed, stating that reserve assets would likely be concentrated in large financial institutions (as opposed to in community banks) and that deposits held as reserves would be wholesale deposits, rather than retail deposits. These commenters stated that wholesale deposits serving as reserve assets would be less able to support credit creation than retail deposits. A large number of commenters favoring a narrow prohibition stated that the economic impact of permitting third parties to pay interest or yield on payment stablecoins was likely to be insignificant. Many of these expressed skepticism that widespread adoption of payment stablecoins, including yield-bearing payment stablecoins, would lead to widespread deposit flight. One commenter noted that the introduction of money market mutual funds did not lead to widespread deposit flight. This commenter argued that competition between bank deposits and payment stablecoins may affect bank profits but would not necessarily affect credit creation. Many commenters cited to a report by the White House Council of Economic Advisers (CEA 57 Estimates cited included Jessie Jiaxu Wang, “Banks in the Age of Stablecoins: Some Possible Implications for Deposits, Credit, and Financial Intermediation,” FEDS Notes (December 17, 2025), available at https://doi.org/10.17016/2380-7172.3970; Treasury Borrowing Advisory Comm., “Charge for the Treasury Borrowing Advisory Committee: Second Quarter 2025,” available at https://home.treasury.gov/system/files/221/TBACCharge2Q22025.pdf; Andrew Nigrinis, “The Lending Impact of Stablecoin-Induced Deposit Outflows, Legal Econ. LLC, (October 10, 2025), available at https://ssrn.com/abstract=5586850; Toni M. Whited et al., “Will Central Bank Digital Currency Disintermediate Banks?” (May 19, 2022), available at https://ssrn.com/abstract=4112644; as well as estimates prepared by the Independent Community Bankers of America, American Bankers Association, and the Bank Policy Institute.

Report) concluding that a yield prohibition would have relatively little impact on deposits or lending but would cause consumers to forgo the benefits of competitive returns on stablecoin holdings. 58 Commenters favoring a broad prohibition criticized the conclusions of the CEA Report and reports reaching similar findings, stating that these reports were based on flawed assumptions and addressed the wrong question (i.e., the policy concern is not whether prohibiting yield on payment stablecoins would constrain bank lending; rather, it is whether allowing yield on payment stablecoins would encourage deposit flight, especially from community banks, raise funding costs, and reduce local credit availability). Commenters favoring a narrow prohibition also stated that a broad prohibition could stifle competition and innovation, distort markets, exacerbate concentration risks, and make stablecoin activity more likely to migrate outside of the United States financial system. Some commenters also stated that the threat to community bank deposits does not arise from payment stablecoins but rather from concentration among global systemically important banks. A small number of commenters stated that the economic impact of a broad or narrow prohibition is uncertain. Of these, some advocated delaying finalization of certain aspects of the rule until after completing a study on the impact of stablecoin adoption on deposits. One commenter stated that the OCC has indicated that it will monitor for deposit flight but has not stated how it would address deposit flight. One commenter stated that the OCC should clearly articulate any concerns about the similarities between payment stablecoins and deposits, so that commenters could provide meaningful input. 58 White House Council of Economic Advisers, “Effect of Stablecoin Yield Prohibition on Lending” (April 2026), available at https://www.whitehouse.gov/wp-content/uploads/2026/04/Effects-of-Stablecoin-Yield-Prohibition-on￾Bank-Lending.pdf.

Congress created a new regulatory framework through the GENIUS Act, and the payment stablecoin and banking industries may change as a result of this new framework. The scale and character of these changes may depend substantially on market developments, customer demand, and implementation of the GENIUS Act. For example, any estimate as to the impact of payment stablecoins on bank deposits or on the broader economy will depend, in part, on how much the payment stablecoin industry grows, where issuers hold their deposits, and whether those deposits are stable. While the OCC can estimate the economic impacts of the rule, there is necessarily a degree of uncertainty with respect to key variables. The OCC intends to monitor the impacts of the final rule as well as developments in the market. The OCC may consider revising the final rule, to the extent necessary and to the extent consistent with the text and purpose of the GENIUS Act. After carefully considering the comments concerning the yield prohibition, the OCC has eliminated the rebuttable presumption from the final rule. 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 rebuttable presumption could have been both overinclusive and underinclusive, capturing permissible arrangements that would have been subject to the rebuttable presumption and allowing the inference that impermissible arrangements not triggering the presumption are consistent with the yield prohibition. Requiring such arrangements to go through the rebuttal process risks imposing burden without a commensurate benefit. Instead of finalizing the proposed rebuttable presumption or otherwise providing guidance on the types of potentially prohibited transactions, the OCC will initially monitor arrangements with permitted payment stablecoin issuers and foreign payment stablecoin issuers

as part of its review of issuers’ applications and ongoing supervision of such entities. Where it identifies transactions that violate or evade the yield prohibition, the OCC will take action and provide the public with additional guidance regarding such actions and interpretations, as appropriate. As the payment stablecoin market develops, the OCC anticipates that it will gain sufficient experience with identifying prohibited transactions to allow it to propose a rulemaking clarifying the yield prohibition that does not have the disadvantages noted above. Prohibition on Rehypothecation Proposed § 15.10(c)(5) included the language from section 4(a)(2) of the Act (12 U.S.C. 5903(a)(2)) that prohibits permitted payment stablecoin issuers from pledging, rehypothecating, or reusing any reserve assets required under 12 U.S.C. 5903(a)(1), except for the purposes listed in section 4(a)(2) of the GENIUS Act (12 U.S.C. 5903(a)(2)). Consistent with the statute, a permitted payment stablecoin issuer cannot pledge, rehypothecate, or reuse any reserve assets, either directly or indirectly (e.g., through a third-party custodian of the reserve assets), except for the purpose of: (i) satisfying margin obligations in connection with investments in permitted reserves under proposed § 15.11(b)(4) or (5); (ii) satisfying obligations associated with the use, receipt, or provision of standard custodial services; or (iii) creating liquidity to meet reasonable expectations of requests to redeem payment stablecoins, such that reserves in the form of Treasury bills with a maturity of 93 days or less may be sold as purchased securities in repurchase agreements, 59 provided that either: (A) the repurchase agreements are cleared by a 59 Section 4(a)(2)(C) of the Act (12 U.S.C. 5903(a)(2)(C)) states that reserves in the form of Treasury bills may be sold as purchased securities for repurchase agreements with a maturity of 93 days or less if certain conditions are met. The OCC proposes to clarify, consistent with section 4(a)(1)(iv) of the Act (12 U.S.C. 5903(a)(1)(iv)), that the Treasury bills sold under the repurchase agreement must have a maturity of 93 days or less. Consistent with this clarification and the OCC's proposed approval of repurchase agreements under section 4(a)(2)(C) of the Act, discussed below, the maturity of the repurchase agreement would be overnight.

clearing agency registered with the Securities and Exchange Commission; or (B) the permitted payment stablecoin issuer receives prior approval from the OCC. The OCC stated in the proposal that by including the phrase “directly or indirectly” in the prohibition, it is clear that Congress intended that a custodian that holds the reserves on behalf of a permitted payment stablecoin issuer also may not pledge, rehypothecate, or reuse any of the reserve assets, other than with respect to the limited exceptions discussed in proposed § 15.10(c)(5). To the extent that a custodian holding the payment stablecoin reserves were allowed to bypass this prohibition, it would undermine the relatively safe nature of the reserve assets and the confidence that payment stablecoin holders have that the payment stablecoin will hold its peg. Several commenters asked the agency for clarification on the scope of activities that are permissible given this prohibition. For example, one commenter asked for confirmation that the prohibition applied only to permitted payment stablecoin issuers and not to depository institutions at which stablecoin issuers hold deposits. The OCC confirms that an insured depository institution that receives deposits from a permitted payment stablecoin issuer may deploy or invest those deposits without running afoul of the prohibition on rehypothecation in § 15.10(c)(5) of the final rule. 60 One commenter asked the OCC to clarify the application of § 15.10(c)(5) to cleared repurchase and reverse repurchase transactions involving United States Treasury securities. The commenter requested confirmation that the rule would not prohibit a permitted payment stablecoin issuer from granting a Treasury clearing agency a limited lien on purchased securities 60 An insured depository institution that receives customer property in a fiduciary capacity may not, however, use or deploy that customer property except as permitted under applicable law including the GENIUS Act and the fiduciary agreement.

received in connection with a permitted cleared tri-party reverse repurchase transaction, where the lien is granted in lieu of margin and is subject to conditions limiting the Treasury clearing agency’s ability to use the securities other than to effect settlement. The commenter also requested that the OCC clarify that § 15.10(c)(5) would not prohibit a permitted payment stablecoin issuer from granting its clearing member a lien on the issuer’s rights under repurchase transactions cleared through the clearing member and related cash and securities, provided the clearing member holds the related cash and securities in a custodial capacity and the obligations secured by the lien are limited to the issuer’s obligations under the related repurchase transactions. With respect to liens in Treasury repurchase agreements, the exception at § 15.10(c)(5)(i) of the final rule allows a permitted payment stablecoin issuer to satisfy margin obligations in connection with reserve assets held either as money received under certain repurchase agreements or as certain reverse repurchase agreements. The agency understands from commenters that, for tri-party reverse repurchase agreements, the party receiving securities may need to satisfy market-standard requirements of the central counterparty. In certain circumstances, these requirements require a party to post margin or, as an alternative, grant a limited lien in favor of the central counterparty. If such a lien is specifically for satisfying margin obligations and effecting settlement, such a lien would likely be consistent with the exception in § 15.10(c)(5)(i). Given that permitted payment stablecoin issuers may hold repurchase or reverse repurchase agreements as permissible reserve assets, and given that standard custodial services by a clearing member include the clearing member holding a limited lien, the prohibition in § 15.10(c)(5) of the rule does not prohibit a permitted payment stablecoin issuer from granting a

lien to a clearing member provided that the clearing member holds related cash and securities in a custodial capacity and that the secured obligations are limited to the customer’s obligations under the related repurchase agreements. One commenter suggested that the OCC expressly permit a permitted payment stablecoin issuer to grant a covered custodian a first-priority lien, security interest, and set-off rights against reserve assets. The commenter also stated that these rights are a routine feature of custody arrangements and help protect custodians when they advance funds or securities to facilitate settlement in custody accounts. In the proposed rule, the OCC originally interpreted the exception to the prohibition on rehypothecation related to satisfying obligations associated with the use, receipt, or provision of standard custodial services to be limited to the purposes specified in section 10(c)(2)(B) of the Act (12 U.S.C. 5909(c)(2)(B)). However, after considering the comments, the OCC believes that such an interpretation of the exception was unnecessarily narrow, and commenters have raised the important point that custody agreements routinely include giving a custodian a security interest in the reserve assets. Accordingly, the OCC reads the exception in section 4(a)(2)(B) of the Act (12 U.S.C. 5903(a)(2)(B)) to allow a permitted payment stablecoin issuer to grant a covered custodian a first-priority lien, security interest, and set-off rights against reserve assets to the extent it is for the purpose of satisfying obligations associated with the use, receipt, or provision of standard custodial services as provided in section 4(a)(2)(B) of the GENIUS Act (12 U.S.C. 5903(a)(2)(B)) and § 15.10(c)(5)(ii). Such a permissible lien, security interest, or set￾off rights would be limited to the bona fide provision of custodial services and limited in scope.

The third and final exception to § 15.10(c)(5) of the rule, § 15.10(c)(5)(iii), is for the creation of liquidity to meet reasonable expectations of requests to redeem payment stablecoins. In the preamble to the proposed rule, the agency explained that, due to the fungibility of money, the OCC would not scrutinize the exact uses to which repurchase borrowing proceeds are put. The OCC explained that rehypothecation would not be permissible if repurchase borrowings are obtained solely for some purpose other than obtaining liquidity to meet redemption requests or compliance with the rule. Some commenters expressed support for the proposal as written, while one commenter stated that if the OCC does not scrutinize how borrowed funds are used, issuers could effectively monetize reserve assets through the repo market. Accordingly, the commenter stated that the OCC should impose clear restrictions on the purposes for which repurchase proceeds may be used and require issuers to maintain contemporaneous records demonstrating that any repurchase borrowing was used exclusively to meet the issuer’s redemption obligations. The OCC continues to hold the view it expressed in the proposal. To the extent the OCC scrutinized the exact uses to which repurchase borrowing proceeds were used, it could impair an issuer’s ability to effectively use repurchase agreements to manage liquidity. Additionally, § 15.10(c)(5)(iii) of the final rule still includes the condition that repurchase agreements should be for the purpose of creating liquidity to meet reasonable expectations of requests to redeem payment stablecoins. Accordingly, if the OCC were to become aware that a permitted payment stablecoin issuer was entering into repurchase agreements for another purpose, the issuer may be in violation of that provision. While all permitted payment stablecoin issuers are subject to the recordkeeping requirements in § 15.14(f), the OCC does not believe an individualized recordkeeping regime for repurchase agreements would be beneficial because it could create

additional burden that would make repurchase agreements a less effective liquidity tool, especially in times of stress. Pre-Approval of Certain Repurchase Agreements With respect to the exception in proposed § 15.10(c)(5)(iii), the OCC proposed to deem any repurchase agreement approved under this section and section 4(a)(2)(C) of the Act (12 U.S.C. 5903(a)(2)(C)), provided that the Treasury bills sold as purchased securities have a maturity of 93 days or less, consistent with the requirement that Treasury bills held as reserve assets must have a maturity of 93 days or less, and the liquidity obtained through repurchase borrowings is not being obtained solely for purposes other than meeting redemption requests or compliance with the requirements of this proposed rule. The proposal explained that section 4(a)(1)(A) of the Act (12 U.S.C. 5903(a)(1)(A)) makes clear that permitted payment stablecoin issuers may maintain identifiable reserves comprising money received under certain repurchase agreements. The proposal further stated that it would frustrate section 4(a)(1)(A)(iv)’s clear permission to maintain such reserve assets if permitted payment stablecoin issuers could only engage in repurchase borrowing transactions upon the completion of cumbersome procedures and one-off supervisory approvals. Several commenters responded to the OCC’s request for input on whether it should pre￾approve repurchase agreements by rule as proposed in § 15.10(c)(5)(iii)(B). Several commenters supported the OCC’s proposal to pre-approve repurchase agreements by rule and characterized case-by-case approvals as risking unnecessary operational delays. Some commenters offered specific suggestions for which types of repurchase agreements the OCC should approve by rule. One commenter recommended that the OCC pre-approve repurchase agreements collateralized by short-term Treasury securities and overnight reverse repurchase agreements with the Federal

Reserve given the minimal liquidity and credit risk. The commenter recommended that repurchase agreements collateralized by other permitted reserve assets be given broad but bounded approval. Another commenter recommended that the OCC pre-approve by rule both overnight and term-repurchase agreements collateralized solely by eligible reserve assets and cleared through a regulated central counterparty. That commenter recommended that pre-approval be accompanied by established guardrails. Another commenter responded that the rule should expressly permit pre-approved, rule-based use of “properly structured [repurchase agreements]” as beyond prohibited “reuse” provided the repurchase agreement is highly liquid and the permitted payment stablecoin issuer can meet redemptions. The commenter described a list of parameters and noted that the OCC’s treatment of such contracts should match established supervisory practice. Another commenter recommended that the OCC adopt a broad and flexible pre-approval framework rather than limiting approvals to specific transaction types given continued evolution in the repurchase agreement market. The OCC is adopting § 15.10(c)(5)(iii)(B) as proposed, with certain clarifying edits described in more detail below. The OCC declines to extend the pre-approval of repurchase agreements beyond those where the Treasury bills that are sold as purchased securities have a maturity of 93 days or less. The OCC is pre-approving repurchase agreements wherein the Treasury bills that are sold as purchased securities have a maturity of 93 days or less because the money received under such agreements is a permissible reserve asset under section 4(a)(1)(A)(iv) (12 U.S.C. 5903(a)(1)(A)(iv)). In addition, section 4(a)(2)(C) of the Act (12 U.S.C. 5903(a)(2)(C)), which prohibits rehypothecation, provides an exception only for this same type of repurchase agreement. Congress’s inclusion of only this limited exception suggests

that Congress did not intend to automatically permit other types of repurchase agreements under the Act or permit other types of repurchase agreements without OCC approval. By contrast, one commenter expressed concern about repurchase agreements and recommended that the OCC exercise its safety and soundness authority to exclude repurchase agreements from the list of permissible reserve assets in the final rule because permitted payment stablecoin issuers that rely on repurchase agreements for cash are dependent on short-term funding that may not be available in stress. That commenter recommended in the alternative that, should it choose to permit repurchase agreements to count towards reserve assets, the OCC limit recognition to centrally cleared repurchase agreements. The OCC declines to categorically exclude repurchase agreements as a permissible reserve asset. Congress clearly intended for money received under repurchase agreements to be a permissible reserve asset type. The OCC also notes that repurchase agreements have the benefit of enhancing liquidity, allowing permitted payment stablecoin issuers to receive the money necessary to facilitate redemptions. The OCC also declines to require central clearing as a precondition to entering into repurchase agreements as central clearing is not required by the Act. 62 However, the OCC notes that central clearing can have the benefit of reducing issuers’ counterparty credit risk. Some commenters recommended that the OCC clarify terms used in the proposal. One commenter recommended that the OCC clarify that the standard for “reasonable expectations of 61 See Esteras v. United States, 606 U.S. 185, 195 (2025) (citation modified) (“This conclusion follows directly from the application of a well-established canon of statutory interpretation: “expressio unius est exclusio alterius”—in plain English, expressing one item of an associated group or series excludes another left unmentioned.”). 62 The prohibition on rehypothecation creates an exception for repurchase agreements cleared by a clearing agency registered with the SEC or those that are approved by the permitted payment stablecoin issuer’s Federal payment stablecoin regulator. See section 4(a)(2)(C)(i) of the Act (12 U.S.C. 5903(a)(2)(C)(i)).

requests to redeem” be assessed by reference to each issuer’s historical redemption patterns, customer base, and risk profile rather than a fixed quantitative threshold. The OCC declines to set a specific quantitative threshold related to the language in
section 4(a)(2)(C) of the Act (12 U.S.C. 5903(a)(2)(C)), which provides that repurchase
agreements falling under the exception to the prohibition on rehypothecation must be for “creating liquidity to meet reasonable expectations of requests to redeem payment stablecoins.” The OCC believes that each individual permitted payment stablecoin issuer is generally in the best position to assess when such repurchase agreements are necessary to create liquidity to meet redemption demands, subject to OCC supervision for compliance with this requirement. A fixed quantitative limit could impair liquidity management, especially in times of stress. The OCC agrees that the permitted payment stablecoin issuer’s historical redemption patterns, customer base, and risk profile may be helpful to issuers when considering whether to enter into a repurchase agreement. Another commenter recommended that the OCC clarify that the standard includes the prudent and routine use of repurchase agreements as a core liquidity management tool, consistent with the commenter’s position that the OCC pre-approve a defined category of low-risk repurchase agreements by rule. The OCC agrees that repurchase agreements can be a core liquidity tool for permitted payment stablecoin issuers, provided they are used in a manner consistent with the Act and
part 15. As discussed above, the OCC is not expanding the category of repurchase agreements
pre-approved by rule beyond the category described in § 15.10(c)(5)(iii)(B).

Some commenters made technical recommendations relating to a rule-based pre-approval process. One commenter recommended that the OCC clarify that creating liquidity to meet reasonable redemption expectations means maintaining a portfolio of reserve assets that can be monetized within T+1 under normal market conditions and T+0 under stressed conditions, calibrated to the issuer’s historical redemption velocity and stress-tested against a variety of scenarios. The OCC declines to limit the phrase “creating liquidity to meet reasonable expectations of requests to redeem payment stablecoins” to require maintaining a portfolio of reserve assets that can be monetized within T+1 under normal market conditions and T+0 under stressed conditions. However, final § 15.12(c)(1) provides that timely redemption may not exceed two business days following the date of the requested redemption. Accordingly, a permitted payment stablecoin issuer’s use of repurchase agreements must not interfere with its ability to satisfy the timely redemption requirement. Another commenter recommended that the OCC confirm that the pre-approval framework does not prohibit repurchase agreements where the repurchase agreement counterparty is also the custodian of the relevant reserve assets. That commenter described the relevant supervisory question as whether the issuer retains full legal ownership of and unimpeded access to reserve assets at all times. The OCC clarifies that the pre-approval framework does not prohibit repurchase agreements where the repurchase agreement counterparty is also the custodian of the relevant reserve assets. 63 However, any limitations in § 15.11 of the final rule would still apply.

After careful consideration of the comments, the OCC is adopting § 15.10(c)(5) as proposed, with certain clarifying edits. Specifically, the OCC is making clarifying edits to § 15.10(c)(5) to remove paragraph (c)(5)(iii)(C) and add new § 15.10(d), which provides that pursuant to section 4(a)(2)(C)(ii) of the GENIUS Act (12 U.S.C. 5903(a)(2)(C)(ii)) and § 15.10(c)(5)(iii)(B), the OCC approves, for all permitted payment stablecoin issuers, repurchase agreements wherein the Treasury bills that are sold have a maturity of 93 days or less. The OCC is also modifying paragraph (c)(5)(iii)(B) to provide that a permitted payment stablecoin issuer may receive approval of a repurchase agreement by order or pursuant to final § 15.10(d). Prohibition on Evasion
Section 4(h)(1) of the GENIUS Act (12 U.S.C. 5903(h)(1)) provides that the OCC may
issue regulations to “carry out the requirements of this section . . . and to prevent evasion thereof.” Consistent with this authority, proposed § 15.10(c)(6) provided that a permitted payment stablecoin issuer must not engage in any activity that the OCC determines is an evasion of the requirements of section 4 of the GENIUS Act (12 U.S.C. 5903) or part 15. One commenter asked the agency to confirm that a stablecoin issuer that relies on published agency guidance in good faith (absent material misstatements or omissions) would not violate the evasion prohibition in § 15.10(c)(6). The OCC declines to provide an explicit safe harbor because whether particular conduct constitutes evasion necessarily depends on the particular facts and circumstances, and because the OCC will gain experience in administering this standard after the final rule becomes effective. Nevertheless, when determining whether a permitted payment stablecoin issuer acted to evade section 4 of the GENIUS Act (12 U.S.C. 5903) or part 15, the OCC would consider,

among other relevant factors, the issuer’s good faith reliance on OCC publications and whether the issuer made misstatements or omitted material facts. Approval Process for Certain Activities Several commenters supported an application or approval process for determining the scope of permissible permitted payment stablecoin issuer activities. By providing clarity in advance, commenters believed an activity approval process could promote innovation, consistency, and appropriate agency-established boundaries. One commenter suggested the OCC, following notice and comment, either list permissible activities for stablecoin issuers or publish a framework for assessing permissibility. The commenter stated that this public notice and comment process could inform what activities the agency enumerates as permissible. Another commenter stated that the OCC should adopt an evolving framework to enumerate additional permissible activities and commit to issuing guidance on permissibility determinations. The OCC declines at this time to commit to publishing a list or framework for activity permissibility. As the OCC stated in the notice of proposed rulemaking, if a permitted payment stablecoin issuer is unclear about whether a particular activity is permissible, the OCC encourages issuers to ask the OCC directly. Because payment stablecoin activities will continue to evolve, a list would quickly become outdated, especially if the OCC was required to publish the list after soliciting notice-and-comment. The OCC anticipates that these implementing regulations will be updated, as necessary, in the years following the effective date of the Act as the business practices of issuers continue to evolve and develop. The OCC may also issue interpretive letters or guidance to help clarify which activities are permissible for permitted payment stablecoin issuers. One commenter asked that the agency

commit to responding to requests for guidance within a defined timeframe. Because the agency does not yet know the frequency of requests, the complexity of requests, or how requests will change with the industry’s evolution, the OCC is unable to determine or commit to how long a response may take. As a result, the agency is not defining a timeframe for responses at this time, but the OCC may revisit this matter in the future as it reviews requests and the industry develops. Incidental and Digital Asset Service Provider Activities The rule of construction in section 4(a)(7)(B) of the GENIUS Act (12 U.S.C. 5903(a)(7)(B)) provides:
Nothing in subparagraph (A) shall limit a permitted payment stablecoin issuer from engaging in payment stablecoin activities or digital asset service provider activities specified by this Act, and activities incidental thereto, that are authorized by the primary Federal payment stablecoin regulator or the State payment stablecoin regulator, as applicable, consistent with all other Federal and State laws[.] In the proposal, the OCC explained that this rule of construction clarifies the scope of section 4(a)(7)(A) (12 U.S.C. 5903(a)(7)(A)) rather than providing an independent grant of authority. With respect to the relationship between sections 4(a)(7)(A) and (B) of the Act (12 U.S.C. 5903(a)(7)(A) and (B)), one commenter asked the agency to clarify that section 4(a)(7)(B) (12 U.S.C. 5903(a)(7)(B)) is not an independent grant of authority that allows permitted payment stablecoin issuers to engage in payment stablecoin activities, digital asset service provider activities, and activities incidental thereto. Instead, the commenter argued
section 4(a)(7)(B) (12 U.S.C. 5903(a)(7)(B)) only clarifies section 4(a)(7)(A) of the Act
(12 U.S.C. 5903(a)(7)(A)). The same commenter further suggested that, in clarifying
section 4(a)(7)(A), the incidental activities in section 4(a)(7)(B) are broader than strictly

necessary activities and merit an evolving framework similar to how the OCC uses interpretive letters to describe the bounds of permissible bank activities. Similarly, another commenter suggested the agency not draw a sharp distinction between activities that directly support enumerated activities under section 4(a)(7)(A) and incidental activities under section 4(a)(7)(B). In contrast, a different commenter encouraged a distinction between 4(a)(7)(A) directly supporting activities and 4(a)(7)(B) incidental activities, and another comment suggested the OCC only publish a list of permissible activities consistent with sections 4(a)(7)(A) and (B) after public notice and comment. As explained above, section 4(a)(7)(B) clarifies the scope of section 4(a)(7)(A). With respect to the commenters that requested clarification on the distinction between 4(a)(7)(A) directly supporting activities and 4(a)(7)(B) incidental activities, based on the phrase “consistent with all other Federal and State laws,” incidental activities in 4(a)(7)(B) must be separately authorized under Federal or State law. By contrast, section 4(a)(7)(A) provides permitted payment stablecoin issuers with an independent grant of authority to engage in activities that directly support certain payment stablecoin activities under 4(a)(7)(A). As stated above, permitted payment stablecoin issuers may ask the OCC to clarify whether an activity is permissible under the appropriate grant of authority. The OCC plans to evaluate whether specific activities are permissible for a permitted payment stablecoin issuer under section 4(a)(7) on a case-by-case basis. The agency will decide how it will publish such determinations as it gains better insight into the volume, breadth, and analytical complexity of these evaluations, which will become more apparent once permitted payment stablecoin issuers begin operating and interacting with the financial system.

Two commenters recommended that the OCC clarify in § 15.10 that the effect of the GENIUS Act’s rule of construction in section 4(a)(7)(B) is that permitted payment stablecoin issuers may conduct digital asset service provider activities, and activities incidental thereto, when authorized by the OCC and otherwise conducted consistently with applicable law. One commenter stated that this clarification is necessary to prevent inconsistent interpretations among regulated entities, State supervisors, and market participants. Another commenter agreed with the need for clarity on this question and cautioned against a burdensome and slow prior-approval process for digital asset service provider activities, advocating instead for a notice-and￾nonobjection framework and OCC publication of a non-exhaustive list of permissible or impermissible digital asset service provider activities. One commenter suggested that Federally supervised digital asset service providers should not need further approval to carry out activities contemplated by the Act. In contrast, another commenter recommended that the agency define the scope of permissible digital asset service provider activities and establish a transparent approval process for digital asset service provider activities. One commenter suggested the agency clarify any differences in the limitations on permitted payment stablecoin issuer permissible activities and the limitations on digital asset service provider permissible activities. Another commenter suggested that the OCC only authorize permitted payment stablecoin issuers to engage in digital asset service provider activities if they specifically enumerate such activities in their application, and that the OCC should require in its application a detailed description of the specific digital asset service provider activities an issuer proposes to conduct. The commenter recommended that applicants be required to publicly release that list and other portions of their applications as required for

national banks and national trust charters, and that any subsequent expansions of digital asset service provider activities should require a new approval. With respect to comments regarding the scope of digital asset service provider activities, as stated above, such activities must be independently authorized by a Federal or State law, to the extent that any such State law is not inconsistent with Federal law. 64 The OCC is adding new § 15.10(b)(2) which codifies activities that are consistent with the rule of construction in section 4(a)(7)(B) of the GENIUS Act (12 U.S.C. 5903(a)(7)(B)). The OCC is adding this new provision to ensure that permitted payment stablecoin issuers may, under part 15, engage in digital asset service provider activities specified by the Act, and activities incidental thereto, that are independently authorized by applicable Federal or State law, to the extent that any such State law is not inconsistent with Federal law. 65 Permitted payment stablecoin issuers may contact the OCC with questions as they arise, and the OCC will provide additional clarification if appropriate. After considering the comments, the OCC is not instituting a new or separate approval process for permitted payment stablecoin issuers to engage in digital asset service provider activities. Permitted payment stablecoin issuers may ask the OCC directly whether specific activities are permissible. The OCC will address activities as the market evolves and as the OCC is presented with specific facts and information to evaluate such requests. The OCC does not have adequate information to address such requests at this time nor does it want to constrain 64 The OCC notes that some digital asset service provider activities will be permissible for permitted payment stablecoin issuers under section 4(a)(7) of the Act (12 U.S.C. 5903(a)(7)). For example, exchanging digital assets for monetary value is a permissible activity because permitted payment stablecoin issuers must perform this activity when redeeming payment stablecoins for monetary value. 65 Section 4(a)(7)(B) of the Act (12 U.S.C. 5903(a)(7)(B)) also requires that “the claims of payment stablecoin holders rank senior to any potential claims of non-stablecoin creditors with respect to reserve assets, consistent with
section 11.”

itself or permitted payment stablecoin issuers to a rigid process. As discussed below, the OCC will consider the appropriate means to publish any interpretations issued related to digital asset service provider activities. The OCC may reconsider in the future whether to institute a new or separate approval process once it gains experience supervising permitted payment stablecoin issuers and evaluating activity requests. National Trust Banks Proposed § 15.10(b) incorporated language from section 16(a) of the GENIUS Act (12 U.S.C. 5915(a)) and emphasized that nothing in proposed § 15.10(a) may be construed to limit the authority of a depository institution, national bank, or trust company to engage in activities permissible pursuant to applicable State and Federal law. Consistent with this provision, for example, an uninsured national bank that is a permitted payment stablecoin issuer could engage in fiduciary, trust, and other related activities consistent with applicable law. Similarly, a national bank or Federal savings association could provide crypto-asset custody services, either in a fiduciary or non-fiduciary capacity, or use distributed ledger technology and related stablecoins to carry out payment activities. 66 Uninsured national banks that limit their operations to those of a trust company or activities related thereto (national trust banks) 67 are one type of institution 66 See OCC Interpretive Letter 1174 (January 4, 2021). The activities described in Interpretive Letter 1174 remain permissible to the extent that they have not been superseded by the GENIUS Act. Indeed, the Act confirms that national banks and Federal savings associations may use payment stablecoins and use certain distributed ledgers to facilitate payments. See 12 U.S.C. 5915. An insured national bank or Federal savings association seeking to issue a payment stablecoin would, however, need to do so through a subsidiary, as required under the GENIUS Act. See 12 U.S.C. 5901(23) (defining permitted payment stablecoin issuer). 67 Twelve U.S.C. 5901(11) provides that Federal qualified payment stablecoin issuer includes an uninsured national bank that is chartered by the Comptroller pursuant to title LXII of the Revised Statutes and that is approved by the Comptroller pursuant to section 5 of the GENIUS Act to issue payment stablecoins.

within the scope of institutions covered by section 16(a) of the Act (12 U.S.C. 5915(a)) and § 15.10(b). Proposed § 15.10(b) would also apply to other types of institutions. 68 Several commenters raised concerns that the proposed regulation would change the activities of or modify current regulations for national trust banks. Two commenters questioned how the proposed rule would align with the list of permitted national trust bank activities in existing regulations, as revised effective April 1, 2026. 69 Other commenters asked the agency to confirm that the regulation implementing the GENIUS Act does not allow national trust banks to engage in activities beyond what the GENIUS Act and their charters authorize. Yet another commenter argued that the OCC’s application of section 16(a) of the Act (12 U.S.C. 5915(a)) to national trust banks should be narrower and more in line with the proposed interpretations of the FDIC and the Department of the Treasury. 70 These commenters were concerned that, among other effects, the proposed rule would allow State trust companies that become permitted payment stablecoin issuers to engage in a large range of activities authorized under State law. A couple of commenters argued that the proposed approach would give rise to a variety of outcomes arguably inconsistent with the GENIUS Act, such as national trust banks paying yield on stablecoins. One of these commenters argued that, because section 4(a)(7)(A) (12 U.S.C. 5903(a)(7)(A)) of the Act, which lists 68 For example, a national bank or Federal savings association could provide crypto-asset custody services, either in a fiduciary or non-fiduciary capacity, or use distributed ledger technology and related stablecoins to carry out payment activities. See OCC Interpretive Letter 1170 (on custody services, citing relevant statutes and regulations); OCC Interpretive Letter 1174 (January 4, 2021) (describing activities that remain permissible to the extent the letter has not been superseded by the GENIUS Act); 12 U.S.C. 5915(a) (confirming that national banks and Federal savings associations may use payment stablecoins and use certain distributed ledgers to facilitate payments). 69 91 FR 9982 (revising 12 CFR 5.20). 70 91 FR 18534 (April 10, 2026); 91 FR 16844 (April 3, 2026).

permissible payment stablecoin issuer activities, uses more specific language than section 16(a) (12 U.S.C. 5915(a)), section 4(a)(7)(A) should be read to override section 16(a). Twelve U.S.C. 27(a) provides that a national bank is not illegally constituted solely because its operations are or have been required by the Comptroller of the Currency to be limited to those of a trust company and activities related thereto. Any national bank chartered under 12 U.S.C. 27(a) is permitted to engage in activities under 12 U.S.C. 92a or 12 U.S.C. 24(Seventh). A national trust bank chartered in reliance on the provision of 12 U.S.C. 27(a) quoted above must limit its operations to those of a trust company and activities related thereto pursuant to 12 U.S.C. 27(a). For a national trust bank that becomes a permitted payment stablecoin issuer, the national trust bank would have to meet the requirements of both a national bank and a permitted payment stablecoin issuer. In other words, a national trust bank’s permitted activities would stem from its authority as a national bank under 12 U.S.C. 92a or 12 U.S.C. 24(Seventh), including activities it is permitted to engage in as a permitted payment stablecoin issuer, as long as all such activities constitute trust company operations or activities related thereto. If the OCC were to read subsection 16(a) of the Act narrowly as applying only to institutions that are not permitted payment stablecoin issuers, the rule would contradict how
section 16(a) operates alongside section 4(a)(7). Rather, the rule does not change the scope of
permissible activities for national trust banks.
Notwithstanding the potentially broader set of permissible activities of national trust banks that are also permitted payment stablecoin issuers, such national trust banks must still comply with the other restrictions of the GENIUS Act and 12 CFR part 15. For example, permitted payment stablecoin issuers are prohibited by section 4(a)(11) of the GENIUS Act (12 U.S.C. 5903(a)(11)) from paying yield solely in connection with the holding, use, or retention of

payment stablecoins. A different or broader set of permissible activities does not permit national trust banks to evade requirements that are applicable to permitted payment stablecoin issuers. More generally, permitted payment stablecoin issuers must adhere to applicable laws and regulations, including, but not limited to, those regarding activities restrictions. Like the Department of the Treasury, the OCC also interprets section 16(a) such that it is not an independent grant of authority. 71 This final rule addresses the activities that are authorized for permitted payment stablecoin issuers regulated by the OCC. The OCC will continue to coordinate with the Department of the Treasury, as appropriate, consistent with section 13 of the Act. One comment suggested the OCC lacks the legal authority to allow national trust banks to issue payment stablecoins because statutes limit national trust banks to fiduciary capacities and ancillary activities. The commenter asked the agency to rescind approvals and orders consistent with that interpretation. The OCC declines to rescind any approvals because its actions were properly taken under 12 U.S.C. 27(a) and 92a. Recent OCC decisions, regulatory revisions, and other policies have described the agency’s understanding of 12 U.S.C. 27(a) and 92a, and nothing in 12 CFR part 15 changes that understanding. 72 The Act permits permitted payment stablecoin issuers to issue payment stablecoins subject to limitations in the Act, and the inclusion of uninsured national banks within the definition of Federal qualified payment stablecoin issuer in section 2(11) of the GENIUS Act (12 U.S.C. 5901(11)) is a clear indication that Congress intended for national trust 71 91 FR 16844, 16857 (April 3, 2026). 72 See, e.g., Conditional Approval 1380, Conditional Approval 1364, Conditional Approval 1353, Conditional Approval 1358.

banks to be able to apply to be permitted payment stablecoin issuers and to issue payment stablecoins. The OCC is finalizing § 15.10(b) as proposed, renumbered as § 15.10(b)(1). Proposed Single Brand Restriction In the proposed rule, the OCC sought comment on whether it should restrict each permitted payment stablecoin issuer to issuing only one brand of payment stablecoin and streamline the process for approving applications to become a permitted payment stablecoin issuer if an affiliate has already been approved as a permitted payment stablecoin issuer. Some commenters supported a restriction that would limit a permitted payment stablecoin issuer to issuance of a single brand of payment stablecoin. Commenters provided various reasons in support of the restriction, including that it would help ensure legal separateness, adequacy of reserves, and maintain safety and soundness. One such commenter stated that white-label arrangements create risks such as obscuring actual reserves and implicit step-in risk for the sponsoring institution to prop up a distressed permitted payment stablecoin issuer. Another commenter mentioned potential de-pegging, run, and contagion risks and noted that appropriate reserve allocation does not necessarily protect against issues related to cyberattacks and money laundering. Many commenters opposed a requirement that would only allow a permitted payment stablecoin issuer to issue one brand of payment stablecoin. Commenters stated several reasons for their opposition to this requirement, including that requiring a separate affiliate to issue a different brand of payment stablecoin would create additional regulatory burden, make white￾labeling economically unviable for all but the largest partners, and add complexity without a

corresponding benefit. One commenter stated that costs of a one-brand requirement were not considered in the proposal’s economic analysis. One commenter stated that the OCC did not identify evidence that a single brand restriction would meaningfully reduce risk and that it was not adequately explained, arguing that it would be arbitrary and capricious for the OCC to include such a limitation. Another commenter stated that a single brand restriction would impose asymmetric costs on nonbank fintech issuers, for which the white-label distribution model is a primary mechanism of market adoption. One commenter stated that the final rule should clarify that the supervisory focus is on the issuer and not on the branding. Some commenters also suggested that a single brand requirement was not consistent with the GENIUS Act. Commenters stated that the term “outstanding issuance value” and Congress’s use of the term “consolidated total outstanding issuance” suggests that Congress did not intend to require product or brand-level segregation of reserves. A few commenters stated that language in
section 5(g) of the Act (12 U.S.C. 5904(g)) provides that regulators “may not impose
requirements in addition to the requirements specified under section 4,” which militates against a single brand restriction. One commenter suggested that any insolvency concerns are better addressed by the statutory provisions of the GENIUS Act. A different commenter stated that even if a one-brand model were adopted, it would not be clear that a bankruptcy court would respect the separate structure because the court could potentially consolidate the assets and liabilities of affiliates. A few commenters acknowledged that a run on payment stablecoin reserves could be a concern in the event a single permitted payment stablecoin issuer issues multiple brands of payment stablecoins but suggested that a single brand restriction was a disproportionate

response. Another commenter stated that in times of stress, payment stablecoin holders are unlikely to parse legal entity structures or differentiate between affiliated issuing entities. The OCC is not implementing a one-brand-per-issuer requirement. While the OCC agrees with certain commenters that such a requirement could help mitigate contagion risks and protect the rights of payment stablecoin holders in the event of insolvency, the OCC acknowledges that such a restriction would also impose burden and is not clearly mandated by the statute. By not implementing such a requirement, the OCC is being responsive to the vast majority of commenters that stated that such a requirement would increase regulatory burden on permitted payment stablecoin issuers. The OCC understands commenters’ concerns that a categorical one￾brand restriction could lead to duplication of supervisory obligations and could potentially make it harder for smaller issuers to issue multiple brands of payment stablecoins. While the OCC is not mandating a one-brand-per-issuer requirement, a one-brand-per￾issuer structure may better protect the rights of payment stablecoin holders than other models as discussed in more detail below. Accordingly, the final rule accommodates business models that employ multiple SPV issuers and reduces the burden of using such business models, including by making certain technical changes. For example, while each SPV would require a license to operate as a permitted payment stablecoin issuer, the OCC anticipates that the burden of seeking out a new license for an SPV will be limited compared to seeking or receiving the initial license, as the applicant could leverage information contained in previous applications for other related SPVs. Similarly, an SPV could rely on a risk management framework developed by its parent entity, provided that the framework met the requirements of § 15.13.

Many commenters suggested potential alternatives to a single brand restriction, including that the OCC could require potential disclosures to ensure transparency with respect to branding. Specifically, one commenter stated that such disclosures should capture same-branded issuance across affiliates. One commenter suggested a monthly reserve composition disclosure, examined by a registered public accounting firm and that includes: (i) the par value of outstanding stablecoins of that brand; (ii) the composition of reserve assets attributable to that brand; (iii) the legal segregation mechanism applicable to that brand’s reserves; (iv) operational controls preventing cross-brand encumbrance; and (v) the holder claim priority rules applicable in the event of issuer distress. Another commenter recommended that the OCC require disclosure of the legal identity of the permitted payment stablecoin issuer that is behind each brand. One commenter mentioned that the disclosures should be prominent to payment stablecoin purchasers and holders and explain which permitted payment stablecoin issuer is responsible for reserves, redemption, and regulatory compliance. The same commenter also stated that issuers should disclose whether the co-branded payment stablecoins are backed by the same reserve pool, the aggregate outstanding issuance across all brands backed by that pool, and the co-branding arrangements in the issuer’s regulatory filings and reserve disclosures. The OCC is not adopting additional disclosure requirements with respect to branding. The final rule, in § 15.11(e), requires that permitted payment stablecoin issuers publish a monthly composition report that lists the different classes or brands of payment stablecoins separately if reserve assets are segregated by brand. Accordingly, the monthly report may already contain the number of total outstanding payment stablecoins by class or brand and the composition of reserves for each brand. The OCC does not believe that additional disclosures related to the legal segregation mechanism, operational controls, or holder priority are necessary

to include in rule text. The OCC is not mandating a legal segregation mechanism in the final rule, and a description of operational controls could potentially be complex, which could confuse payment stablecoin holders. Additionally, because of the current inherent uncertainty associated with resolving white-label issuers, there is a risk that disclosures about a payment stablecoin holder’s claim in the event of insolvency could misstate the legal protection that will ultimately be afforded to payment stablecoin holders. Moreover, the redemption disclosures in § 15.12(e) of the final rule will require permitted payment stablecoin issuers to provide the name of the permitted payment stablecoin issuer that issues the payment stablecoin, which will allow payment stablecoin holders to identify the issuer behind each branded payment stablecoin, including in a white-label arrangement or other third￾party relationships where the branded coin may not otherwise identify the issuer. Such disclosures are required to be conspicuous and readily noticeable under § 15.12(e)(1) of the final rule, so no further requirements related to prominence are necessary. Permitted payment stablecoin issuers may include additional disclosures regarding their co-branding arrangements and whether co-branded payment stablecoins are backed by the same reserve pool so long as the disclosures comply with the Act, 12 CFR part 15, and other applicable laws. One commenter stated that issuers should be required to disclose to the OCC the internal policies and controls by which they achieve legal segregation. Another commenter stated that the OCC should prohibit any co-branding arrangement in which the distribution partner represents to holders that it, rather than the licensed issuer, is responsible for reserves, redemption, or regulatory compliance. Another commenter stated that reserve reporting should align with the statute and be at the entity level with the option for issuers to report reserves at the individual brand level. One commenter stated that there should be express disclosures to each brand’s

holders concerning the multi-brand structure and the cross-brand non-encumbrance regime. One commenter stated that the OCC should permit and encourage layered, technology-enabled disclosure approaches. The OCC may review a permitted payment stablecoin issuer’s internal policies and controls during the supervisory process, and therefore, no specific disclosure requirement to the OCC is expressly required. Additionally, if a distribution partner that is not a permitted payment stablecoin issuer falsely represents that it is the issuer, the permitted payment stablecoin issuer responsible for redemption may not be in conformance with the disclosure requirements in § 15.12(e). For the entities under its jurisdiction, the OCC would ensure that any such misrepresentations, at a minimum, are handled through the supervisory process. Additionally, the monthly composition report in § 15.11(e) of the final rule limits the need for additional disclosures around a multi-brand structure because issuers will already be required to publish the reserves on a per-brand basis if the brands are secured by distinct pools of reserve assets. The monthly composition report specifically requires that, to the extent that different classes or brands of payment stablecoins are secured by distinct pools of reserve assets, permitted payment stablecoin issuers should publish a composition table for each class or brand of payment stablecoin and describe the legal and operational mechanisms, as applicable, for how the assets are separately secured. The final rule further specifies that if different classes or brands of payment stablecoins are issued by distinct issuers, including SPV issuers, a separate report must be provided for each issuer. Moreover, the final rule does not require that reserves of each branded stablecoin be legally separate, and therefore, the OCC is not requiring disclosures related to cross-brand encumbrance. Of course, reserve assets may not be pledged, rehypothecated, or reused as

provided in the Act and in § 15.10(c)(5), and every permitted payment stablecoin issuer must maintain reserve assets that at all times have a reserve asset value that equals or exceeds the outstanding issuance value of the permitted payment stablecoin issuer in accordance with § 15.11(a)(1)(iii). As discussed in more detail below, the OCC is not prescribing a specific format for disclosures beyond the reports required in § 15.14, but technology-enabled disclosures are acceptable as long as they conform with the requirements of the Act and this final rule. In addition to disclosures, many commenters suggested that as an alternative to a single brand restriction, permitted payment stablecoin issuers should segregate reserves based on brand. Another commenter suggested specific regulatory text that would allow for permitted payment stablecoin issuers and foreign payment stablecoin issuers to issue one or more distinctly branded payment stablecoins, provided that the issuer satisfies certain brand-level segregation and disclosure requirements, including that the issuers maintain reserves in segregated account structures, SPVs, or other legally recognized segregation mechanisms approved by the OCC. The commenter suggested that the OCC could consider on a facts-and-circumstances basis whether the issuer’s segregation mechanism provides adequate protection for reserves. Another commenter stated that the OCC should recognize certain statutory cell structures established in other jurisdictions as satisfying the legal separateness objective and that not doing so would disadvantage issuers operating in jurisdictions whose corporate law specifically addresses the segregation issue. One commenter suggested that the OCC should address any concerns regarding branded stablecoins through its authority in section 4(h)(1) of the Act (12 U.S.C. 5903(h)(1)) by imposing conditions, including maintenance of segregated reserves at the issuer level, brand-level attestations that reconcile to the issuer’s reserves. The same

commenter suggested that the OCC should condition certain arrangements where there is an evasion of the reserve requirements in the Act. In the proposed rule, the OCC also asked whether it should require a permitted payment stablecoin issuer to hold reserves in a SPV that is fully capitalized by the issuer and has no liabilities. While one commenter stated that the OCC has the authority to require the use of SPVs when warranted, a few commenters stated that the OCC should permit, but not mandate, the use of SPVs to hold different reserves. Commenters stated that SPVs should not be mandatory as they would impose substantial structural and operational costs, particularly for smaller issuers and would not provide meaningful additional protection to stablecoin holders. The commenter stated that while SPVs are not prohibited under the GENIUS Act, the regulators should work through resolution options for permitted payment stablecoin issuers and clarify how SPVs would fit into the bankruptcy protections of the GENIUS Act. A different commenter stated that if appropriate, issuers should provide a legal opinion or third-party attestation confirming that each brand’s reserve pool is held in a bankruptcy-remote structure. Another commenter opposed requiring SPVs for each brand, stating that legal separateness would not prevent risk. One commenter stated that certain protections apply to the bankruptcy of an issuer, which would raise questions about the status of a SPV and how it would manage liquidity. One commenter stated that a permitted payment stablecoin issuer should only be able to issue more than one brand of payment stablecoin if the reserves are in a SPV, each program’s reserves are managed, valued, and reported on a stand-alone basis, and each brand has its own redemption arrangements under which redemptions are payable solely from the brand’s reserves. One commenter stated that such SPVs must have documented controls preventing cross-brand reserve encumbrance.

The final rule does not require a specific per-brand reserve segregation requirement, but reserve assets must comply with the requirements of § 15.11, including that they are identifiable and segregated from and not commingled with other assets owned or held by the permitted payment stablecoin issuer. The OCC retains discretion to impose conditions through the licensing process and will consider any segregation mechanisms proposed by the permitted payment stablecoin issuer or foreign issuer as well as any alternative approaches and determine whether such a mechanism or approach provides adequate protection for payment stablecoin holders, which will include consideration of whether reserves are adequately protected. With respect to statutory cell structures, the OCC will evaluate any particular proposed legal segregation mechanism at the time of licensing or registration as well as during ongoing supervision. However, the OCC declines in this rulemaking to make a categorical determination that a particular legal segregation mechanism is sufficient or required. With respect to the commenter’s concern regarding evasion, to the extent that a permitted payment stablecoin issuer evades the reserve requirements of the Act, the OCC would consider whether the issuer was violating the Act, § 15.11, or any other requirements in part 15. As discussed previously, the one-brand-per-issuer structure may better protect the rights of payment stablecoin holders than other models. Specifically, such a structure could help to ensure that the reserves of each brand of payment stablecoin are legally separate, reducing the risk that a run on one brand of payment stablecoin causes a run on other brands of a related payment stablecoin. Accordingly, while the final rule does not require the use of SPVs, the OCC is making changes to the final rule to accommodate the use of multiple SPV issuers and reduce the burden of using such a business model, including by making certain technical changes.

Commenters stated that the OCC should focus on establishing clear regulatory expectations for segregation, clear titling, recordkeeping, and labeling of reserve assets to ensure transparency and that the OCC should allow issuers to present specific mechanisms for separating and tracking reserves across differently branded stablecoins. One commenter suggested segregated account structures, including segregated custodial sub-accounts at eligible financial institutions, customer-property segregation regimes, or other segregation mechanisms approved by the OCC. The commenter further stated that the selected mechanism must have documented controls preventing the encumbrance, pledging, rehypothecation, or commingling of reserves. A few commenters suggested that permitted payment stablecoin issuers can set up separate trusts to otherwise manage reserve assets. Another commenter suggested token-level ring-fencing and compliance controls as well as sub-ledgering of reserves to address concerns. While the OCC is not requiring a particular reserve segregation method, permitted payment stablecoin issuers are subject to the recordkeeping requirements in § 15.14(f) of the final rule. Accordingly, the OCC believes that the final rule sets clear regulatory expectations for recordkeeping and labeling of reserves. The OCC agrees that issuers should be allowed to present specific mechanisms for separating and tracking reserves and will allow issuers to present a specific mechanism during the licensing or registration process and as part of ongoing supervision. The OCC will consider the use of custodial sub-accounts and other customer segregation mechanisms when making a facts-and-circumstances determination as to whether payment stablecoin holders are adequately protected, including in the event of insolvency. Any custodial sub-accounts must comply with the requirements in final § 15.22(c). The OCC agrees that documented controls can help to strengthen a particular segregation mechanism, which will factor into the OCC’s evaluation of whether the mechanism protects payment stablecoin holders.

With respect to the use of separate trusts, the OCC again will consider such a mechanism as part of the application process, rather than making a categorical determination as part of this final rule that such a mechanism adequately protects payment stablecoin holders, to ensure a more detailed review of the trusts. Similarly, the OCC will need to evaluate in each instance how an issuer seeks to achieve token-level ring-fencing to better understand its utility. For issuers that use segregation mechanisms, the monthly composition report will already require the sub-ledgering of reserve assets. In addition to suggestions regarding disclosures and segregation of reserves, many commenters suggested other alternatives to a single brand restriction. For example, a few commenters suggested redemption rights, internal controls, and operational allocation as ways to mitigate concerns regarding uncertainty of reserve assets for permitted payment stablecoin issuers with multiple brands of payment stablecoins. The OCC will consider an applicant’s internal controls and operational allocation when evaluating the permitted payment stablecoin issuer or foreign issuer during the licensing or registration process. An issuer’s redemption policies must comply with the Act and, among other things, the requirements for redemption in § 15.12. However, the OCC expects that there may be some situations where redemption rights alone will be insufficient to protect the rights of payment stablecoin holders in the event of insolvency. A different commenter suggested brand-level CPA examinations and explicit operational controls preventing cross-brand reserve encumbrance. One commenter suggested that the OCC use its supervisory tools to address any issues regarding reserve uncertainty in white-label arrangements.

With respect to the suggestion regarding brand-level CPA examinations, the monthly reserve composition report required under § 15.11(e), which requires reporting of reserve assets by brand, if applicable, must be examined by a registered public accounting firm, and therefore, no further CPA examination is necessary as an across-the-board requirement. Additionally, the OCC will use its supervisory tools to ensure that any concerns regarding white-label arrangements are being managed adequately. One commenter stated that the OCC should focus on ensuring that there is supervisory coordination and service provider/affiliate risk management to cover bank and nonbank consortium members, including distribution platforms. Another commenter stated that consistent treatment of comparable claimants and operational planning could help mitigate risks related to the issuance of multiple brands of payment stablecoins. The final rule includes risk management requirements related to affiliate transactions as well as service provider arrangements. Accordingly, permitted payment stablecoin issuers are already expected to ensure sufficient oversight of such arrangements. To the extent that members of a white-label arrangement are regulated by another entity, the OCC will strive to ensure there is supervisory coordination between agencies. With respect to treating comparable claimants consistently, a permitted payment stablecoin issuer must comply with the Act and the redemption requirements in 12 CFR part 15. Additionally, the OCC encourages operational planning and expects it would be prudent for most issuers to engage in such planning in the ordinary course of business. One commenter suggested that a permitted payment stablecoin issuer should be required to submit a brand-level stress-period redemption plan setting forth: (i) the threshold conditions

that will trigger stress-period mechanisms for the branded payment stablecoins it issues or may issue in the future; (ii) the redemption queue, prioritization, and processing protocols applicable during stress; (iii) the communication and disclosure protocols for that brand’s holders; and (iv) the operational steps to ensure that brand-level stress does not propagate to other brands. The OCC is adding monetization and stress-testing requirements for all permitted payment stablecoin issuers in § 15.13(a)(9) of the final rule. In addition, final § 15.11 requires that permitted payment stablecoin issuers must demonstrate the operational capability to access and monetize identifiable reserve assets to meet redemptions, in both normal and adverse economic, liquidity, market, and interest rate conditions. Accordingly, the OCC is not instituting any white-label specific stress testing because a permitted payment stablecoin issuer that issues multiple brands of payment stablecoins must ensure that it can access and monetize reserve assets to meet redemption requests for all brands of payment stablecoins. As discussed above, the OCC is not instituting additional communication and disclosure protocols. The OCC will consider the operational steps an issuer takes to ensure that brand-level stress does not propagate to other brands as part of the licensing, registration, and ongoing supervisory process. A few commenters stated that the OCC should align with the FDIC’s notice of proposed rulemaking implementing the GENIUS Act and manage brand-level obligations through mandating disclosures and ensuring that required reserves can be separately identified as backing a particular brand of payment stablecoin. A few commenters suggested that if the OCC were not to align with the FDIC, it would create regulatory divergence and favor FDIC-regulated issuers. Similarly, one commenter suggested coordination with the other Federal regulators to ensure consistent requirements for white-label arrangements.

The OCC declines to take the same approach as the FDIC did in its notice of proposed rulemaking, which requires multi-brand issuers to have a segregated pool of reserves that are recorded separately, unless the FDIC approves in writing that the permitted payment stablecoin issuer may commingle reserves. Instead, the OCC is taking a case-by-case approach during the licensing or registration process and will evaluate whether payment stablecoin holders are adequately protected when the issuer issues multiple brands of payment stablecoins. The OCC believes this approach allows issuers flexibility to explain to the OCC how it can adequately protect payment stablecoin holders when issuing multiple brands of payment stablecoins. The OCC will coordinate with other primary Federal payment stablecoin regulators and will continually evaluate its treatment of white-label arrangements to strive for consistent treatment. A few commenters stated some conditions they would favor if the OCC were to impose a single brand restriction. One commenter stated that if the OCC does require a separate issuer for each brand of payment stablecoin, the OCC would need to clarify how capital, liquidity, and other risk management requirements and governance arrangements would be applied across each separate issuer. Another commenter stated that if the OCC adopts such a restriction, it should clarify that the restriction applies to issuer and custodian functions and does not require highly duplicative per-brand separation of infrastructure. Although the OCC is not imposing a single brand restriction, the OCC is clarifying how capital, liquidity, and other risk management requirements and governance arrangements would be applied if a permitted payment stablecoin issuer makes use of an SPV during the licensing or registration process. The OCC is committed to ensuring that the use of an SPV would not cause unnecessary duplication of supervisory obligations.

A few commenters remarked on the language in the proposal that suggested that the OCC was considering streamlining the licensing process for affiliates if it were to impose a single brand restriction. A few commenters stated that if the OCC decides that separate legal entities are required for each brand, the OCC should adopt a streamlined approval process. One commenter suggested a notification-based process, under which the OCC confirms approval within a defined timeframe. One commenter stated that the OCC should clarify that a license for a permitted payment stablecoin issuer should extend to cover any consolidated affiliates of the issuer that issue the same token under the same brand and reserve framework, without requiring a separate license application for each affiliate entity. Another commenter stated that any requirements relating to multi-brand issuance should be applied consistently across all OCC-regulated entities. One commenter stated that State regulatory agencies would need to review applications for a new entity and a streamlined process for affiliates of already-approved issuers would be antithetical to how State regulatory agencies operate and would not enhance safety and soundness. The OCC is not revising the application process for affiliates because it is not imposing a one-brand restriction and the final application process is sufficiently streamlined to limit burden for SPV issuers. To the extent that a permitted payment stablecoin issuer makes use of an SPV, the OCC will ensure that the process is streamlined if the SPV is a separate issuer. If an affiliate is issuing the same token under the same brand and reserve framework but is a different issuer, the issuer would need to apply separately to the OCC through the licensing or registration process; a license to issue payment stablecoins is not a group-wide authorization that automatically extends to affiliates.

Multi-jurisdictional Stablecoin Issuance
In the proposal, the OCC asked whether it should address permitted payment stablecoin issuers that also issue or redeem the same or similar stablecoins in one or more foreign jurisdictions, sometimes referred to as multi-jurisdictional stablecoin issuance. Many commenters stated that the OCC should clarify that permitted payment stablecoin issuers may engage in multi-jurisdictional issuance, emphasizing that fungibility, transferability, and global circulation are central features of payment stablecoins. Commenters stated that, absent OCC guidance, multi-jurisdictional issuance could be subject to uncertainty and barriers that impede cross-border adoption and prevent payment stablecoins from circulating on a global basis. One commenter specifically advocated for a safe harbor for such arrangements. One commenter stated that section 4(a)(1)(A)(ii) of the Act (12 U.S.C. 5903(a)(1)(A)(ii)) explicitly permits reserves at correspondents and foreign agents of insured depository institutions, reflecting that permitted payment stablecoin issuers will conduct issuance and redemption activity outside of the United States as a matter of ordinary operations. Commenters identified several issues that would result from the OCC not addressing multi-jurisdictional issuance, including duplicative or conflicting supervisory expectations, inefficient reserve allocation, inconsistent redemption architecture, and technical design mandates that fragment liquidity and undermine interoperability. One commenter stated that the OCC should ensure permitted payment stablecoin issuer licenses include like-branded stablecoins issued by consolidated affiliates to ensure OCC visibility and accountability for all like-branded stablecoins. One commenter requested that the final rules enable a permitted payment stablecoin issuer and its foreign affiliate to rebalance reserve assets to meet their

redemption needs, provided that the permitted payment stablecoin issuer and its affiliate at all times hold reserves on a 1 to 1 basis against the total outstanding issuance of their aggregate payment stablecoins. Many commenters mentioned coordination with the United States Department of the Treasury or other regulators with respect to multi-jurisdictional stablecoin issuance. Specifically, a few commenters urged coordination between the OCC and Treasury with respect to Treasury’s obligations under section 18 of the Act regarding making determinations that foreign countries have comparable regulatory and supervisory regimes. A few commenters stated that multi￾jurisdictional stablecoin issuance should be permissible when Treasury has made a comparability determination or entered into certain reciprocal arrangements. Another commenter stated that the OCC should not push stablecoin issuers to create multiple licensed entities in different jurisdictions to achieve multi-jurisdictional stablecoin issuance. One commenter stated that even if such a push would have short-term benefits, separate licensing for separate entities in separate jurisdictions would be inconsistent with the GENIUS Act, including with respect to reciprocal arrangements under section 18(d) of the Act (12 U.S.C. 5916(d)). A different commenter stated that foreign jurisdictions seeking reciprocity should not be permitted to impose fundamentally different prudential requirements on permitted payment stablecoin issuers. One commenter stated that the OCC should provide a safe harbor for foreign affiliates that operate under a comparable regime, including guidance that addresses reserve location, reserve rebalancing, disclosures, customer segregation, redemption routing, operational controls, and examination expectations for the relevant permitted payment stablecoin issuers. Another commenter stated that the OCC should clarify that the operations of a permitted payment stablecoin issuer are subject to compliance with applicable requirements under the laws

of other jurisdictions in which it issues stablecoins. One commenter stated that the OCC should engage with relevant electronic money institution regulators in the European Union to further support global acceptance of multi-jurisdictional issuance. The commenter further stated that the OCC should prioritize functional coordination with foreign regulators whenever an OCC￾supervised permitted payment stablecoin issuer operates through foreign regulated issuing affiliates, including through memoranda of understanding and information sharing protocols. As explained below, the OCC is not specifically addressing multi-jurisdictional issuance in the regulatory text of the final rule. The OCC agrees with the numerous commenters that stated that the OCC should coordinate with the Department of the Treasury and foreign regulators. Under section 18 of the Act (12 U.S.C. 5916), the Secretary of the Treasury may determine whether a foreign country has a comparable regulatory and supervisory regime upon a recommendation from the other members of the Stablecoin Certification Review Committee. Additionally, the Secretary of the Treasury may also create and implement reciprocal arrangements or other bilateral agreements between the United States and jurisdictions with comparable payment stablecoin regulatory regimes. Accordingly, the OCC declines to provide any guidance on such determinations or reciprocal arrangements, as they are within the authority of the Department of the Treasury. Similarly, the OCC is not providing a safe harbor for foreign affiliates that operate under a comparable regime because these are determinations of the Department of the Treasury that have yet to be made, and as noted, the OCC plans to coordinate with the Department of the Treasury as appropriate on the continuing implementation of section 18 of the Act. Additionally, the OCC will not opine on the applicability of foreign laws because

doing so is outside the scope of this rulemaking, which focuses on implementing the GENIUS Act. 73 The OCC also expects to be able to assess in more detail multi-jurisdictional issuance arrangements on a case-by-case basis, including how such arrangements comply with the requirement in section 4(a)(1)(A) of the Act (12 U.S.C. 5903(a)(1)(A)) that a permitted payment stablecoin issuer “maintain identifiable reserves backing the outstanding payment stablecoins of the permitted payment stablecoin issuer on at least [a] 1 to 1 basis.” Because multi-jurisdictional arrangements may involve the rebalancing of reserves among the permitted payment stablecoin issuer and its affiliates, it is especially important that the permitted payment stablecoin issuer comply with the requirement in § 15.11(a) that it maintain reserves that at all times have a reserve asset value that equals or exceeds the outstanding issuance value of the permitted payment stablecoin issuer. Commenters also suggested specific areas where OCC standards or guidance would be useful with respect to multi-jurisdictional issuance, including disclosures, reporting, supervisory expectations, risk management, the applicable governing regime, reserve treatment, customer￾protection requirements, timely redemption, ring-fencing risk, redemption rights, customer segregation, and examination coordination. Several commenters focused on reserve and redemption issues. One commenter stated that the OCC should clarify whether cross-border redemption to foreign bank accounts may be subject to a reasonable timeline longer than two business days. Others stated that the OCC should address reserve rebalancing across 73 The OCC notes that section 3(e) of the Act (12 U.S.C. 5902(e)) provides that section 3 is intended to have extraterritorial effect if conduct involves the offer or sale of a payment stablecoin to a person located in the United States.

jurisdictions, including by permitting reserve assets to move in both directions between a U.S.- based permitted payment stablecoin issuer and cross-border affiliates. One commenter specifically stated that the issuer and its affiliates should maintain reserves on a 1 to 1 basis. As stated, the OCC is declining to provide specific guidance on multi-jurisdictional issuance beyond the fact that such arrangements must comply with the Act and part 15. The OCC intends to coordinate with Treasury and foreign regulators, as appropriate, prior to providing any guidance on these arrangements. The OCC declines to provide an exception allowing cross-border redemptions to be completed on a longer redemption timeframe than domestic redemptions. All redemptions must comply with the requirements in § 15.12 of the final rule, including that timely redemptions may not exceed two business days following the date of the requested redemption. As explained below in response to comments about § 15.12, the final rule clarifies the beginning and end of the redemption timeline while retaining the baseline for timely redemption. Under § 15.12(a)(1) of the final rule, the obligation to redeem begins with the receipt of a redemption order from a customer and the satisfaction of conditions necessary to permit redemption (such as customer onboarding). Under § 15.12(a)(2) of the final rule, a redemption that involves an outgoing transfer of monetary value is deemed to occur when the permitted payment stablecoin issuer has fully processed and initiated the outgoing transfer of monetary value to the customer or customer’s financial institution as directed by the customer. Given the changes to § 15.12, a longer redemption timeframe for cross-border redemption is unnecessary as certain processes that could take longer in a cross-border context (e.g., the time required for funds to be received or credited to an account) are outside the redemption timeframe. The OCC is not specifically addressing reserve rebalancing in the final rule, except to

state that such arrangements must comply with the Act and this final rule, including the requirement that reserve assets must fully back outstanding payment stablecoins at all times. Commenters also urged clear reporting, disclosures, and brand-level transparency, including measures to distinguish United States issuance activity from foreign activity. With respect to technology, one commenter supported requiring or encouraging blockchain infrastructure to support jurisdiction-specific compliance rule sets, while another opposed OCC mandates for particular technical architectures, such as wrappers, separate token contracts, or separate token addresses. Another commenter stated that operational risks associated with multi￾jurisdictional stablecoin issuance should be addressed through existing contingency planning and robust risk management frameworks and that the OCC should require issuers to incorporate cross-border risks (e.g., redemption demand exceeding local liquidity) in contingency planning and liquidity management frameworks. The OCC agrees that clear reporting, disclosures, and transparency could be helpful in promoting clarity with respect to multi-jurisdictional arrangements, but the OCC needs more information before it can specifically provide clarity on how these topics apply to such arrangements. Similarly, the OCC is not setting any technical mandates for such arrangements for the same reason. To the extent a permitted payment stablecoin issuer engages in multi￾jurisdictional issuance, any risk management requirements in the final rule will still apply. A few commenters urged the OCC to avoid prescriptive requirements, rigid segregation requirements, or a categorical ban that would disfavor multi-jurisdictional issuance. For example, one commenter stated that the OCC should evaluate issuers based on the adequacy of their risk management frameworks rather than impose mandates that could artificially segment tokens,

reserves, infrastructure, or disclosures by jurisdiction. Commenters cautioned that such requirements could impair liquidity management, increase operational complexity, undermine fungibility, and worsen redemption risk. Commenters also stated that the OCC should permit shared infrastructure, compliance services, and personnel; allow holders to redeem through any participating permitted payment stablecoin issuer within a network, subject to BSA checks and OCC timely-redemption standards; and consider allowing a unified reserve pool for all outstanding tokens, provided United States holders retain clear redemption rights. One commenter stated that permitted payment stablecoin issuer licenses should include like-branded stablecoins issued by consolidated affiliates. The commenter further stated that permitted payment stablecoin issuer licenses should encompass the issuer and any consolidated affiliates issuing the same token. The OCC is neither imposing prescriptive requirements nor a categorical ban on multi￾jurisdictional issuance as it believes further coordination and experience would be useful to ensure any potential guidance on such arrangements is responsive and fully informed. For these reasons, the OCC declines to provide further guidance on shared infrastructure, redemption rights specific to such arrangements, and the idea of a unified reserve pool. As previously stated, any such arrangements must comply with the Act and the requirements in this final rule, including those related to redemption.
2. Reserve Assets (§ 15.11)
a. Overview of Changes from Proposed Rule to Final Rule for § 15.11 In both the proposed rule and the final rule, § 15.11(a) contains reserve requirements for permitted payment stablecoin issuers. The OCC is adopting § 15.11(a)(1) largely as proposed except for a substitution of “reserve asset value” where the proposed rule had used “total fair

value” in § 15.11(a)(1)(iii). As in the proposal, final § 15.11(a)(2) requires permitted payment stablecoin issuers to demonstrate the operational capability to access and monetize the identifiable reserve assets, but the final rule further explains that such operational capability is to meet redemptions under various conditions after taking into account several relevant factors, which had been raised in the preamble of the proposed rule and are now being codified in the regulatory text itself. New § 15.11(a)(3) requires a permitted payment stablecoin issuer to ensure that reserve asset value will continue to equal or exceed outstanding issuance value at all times and that the reserve asset portfolio will be capable of supporting timely redemption under both normal conditions and adverse economic, liquidity, market, and interest rate conditions, including, to the extent necessary, maintaining a buffer of reserve assets in excess of outstanding issuance value. The agency is adopting proposed § 15.11(a)(3), renumbered as § 15.11(a)(4) and revised, to address when a permitted payment stablecoin issuer may withdraw reserve assets in excess of outstanding issuance value. While the proposed version of this paragraph permitted withdrawals of surplus reserve assets only once per month and explained how a permitted payment stablecoin issuer must make such a withdrawal, the final version permits withdrawals of reserve assets at any time following appropriate due diligence and confirmation that the withdrawal would not cause reserve asset value to fall below outstanding issuance value. Final § 15.11(a)(4) also deletes the phrase “any surplus” as superfluous because the phrase “reserve assets in excess of outstanding issuance value” sufficiently identifies what constitutes surplus reserve assets. Final § 15.11(a)(4) does not subject income earned from reserve assets to due diligence and confirmation requirements for withdrawal, as long as a permitted payment stablecoin issuer otherwise complies with the requirements of the final rule necessary to ensure that reserve asset value at all times equals or exceeds outstanding issuance value.

Final § 15.11(b) describes the composition of reserve assets much as the proposed § 15.11(b) did. The OCC is finalizing § 15.11(b)(1), (3), and (4) as proposed. In § 15.11(b)(2), the OCC has modified the description of deposits and insured shares to more closely align with the Act. In adopting the phrasing used by the Act (“funds held as demand deposits”), the OCC is clarifying that reserve assets held as deposits must be deposits payable on demand (i.e., without features that would delay or condition withdrawals), notwithstanding interpretations of the phrase “demand deposits” from other contexts. 74 In § 15.11(b)(5), the OCC is making a minor technical change (adding the word “or”). In § 15.11(b)(6), the OCC is making a technical change to add paragraphs (b)(6)(i) and (b)(6)(ii) but is not changing substantively which securities are eligible as a reserve asset. In § 15.11(b)(7), the OCC is finalizing the rule as proposed with the clarification that OCC approval of other liquid Federal Government-issued assets is subject to such conditions as the OCC may impose consistent with the purposes of the GENIUS Act. In § 15.11(b)(8), the OCC is making minor technical changes. The final versions of § 15.11(c) and (d) have substantial differences from their proposed versions. For § 15.11(c), addressing reserve asset diversification and concentration, the proposal included two options, described in the proposal as Option A and Option B. The OCC is finalizing the version of § 15.11(c)(1) from Option A but is splitting up proposed § 15.11(c)(1) into paragraphs (c)(1)(i) and (c)(1)(ii) and adding a new paragraph (c)(1)(iii) clarifying that, in order to comply with paragraphs (c)(1)(i) and (c)(1)(ii), permitted payment stablecoin issuers may need to maintain a portfolio of reserve assets that exceeds the requirements of paragraph (c)(2) and the reserve asset value of which exceeds outstanding issuance value. 74 See, e.g., 12 CFR 204.2(b)(1) (allowing a deposit with a notice period of up to 7 days to be considered a “demand deposit”).

For § 15.11(c)(2), the OCC is finalizing an edited version of Option B. Whereas § 15.11(c)(1) in Option B required a permitted payment stablecoin issuer to maintain at least 10 percent of its reserve assets as deposits or insured shares payable upon demand or money to the credit of an account with a Federal Reserve Bank, final § 15.11(c)(2)(i) requires at least 5 percent in demand deposits (or other deposits that may be withdrawn upon request at any time), funds in share accounts that are payable on demand, or money standing to the credit of an account with a Federal Reserve Bank. Final § 15.11(c) does not include § 15.11(c)(2) of Option B that would have required an amount of funds to be receivable and due unconditionally within five business days (weekly liquidity). In finalizing the rule, the OCC modified § 15.11(c)(3) of Option B, renumbered as § 15.11(c)(2)(ii), such that a permitted payment stablecoin issuer must limit its exposure to any one counterparty to no more than 40 percent of its reserve assets, subject to certain exceptions. The proposed version had required permitted payment stablecoin issuers to maintain no more than 40 percent of reserve assets at any one eligible financial institution across any of several listed exposures. The agency is finalizing § 15.11(c) without § 15.11(c)(4) and (5) from Option B, which addressed holdings at any one eligible financial institution and the weighted average maturity of reserve assets, respectively. The OCC replaced § 15.11(d) of the proposed rule, which was about the minimum amount of reserve assets that must be insured, with final § 15.11(d), which describes when reserve assets in the custody of one or more eligible financial institutions are not subject to the 40 percent limitation in final § 15.11(c)(2)(ii). The OCC is finalizing § 15.11(e) as proposed with conforming and technical edits throughout, including to the template monthly composition report. Additionally, the agency is finalizing § 15.11(f) as proposed with certain clarifying edits. In § 15.11(g), the agency is

finalizing the rule as proposed with certain clarifying edits throughout, including using the phrase “minimum reserve asset amount required by paragraph (a) of this section” in § 15.11(g)(1), (g)(2), and (g)(3). Additionally, in § 15.11(g)(2)(i), the OCC is clarifying that a noncompliant permitted payment stablecoin issuer may issue new payment stablecoins if permitted by the OCC. The OCC is also making technical changes to § 15.11(g)(4) and splitting that paragraph into three paragraphs (g)(4)(i) through (g)(4)(iii). b. Reserve Requirements (§ 15.11(a))
Section 4(a)(1)(A) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)) requires a permitted
payment stablecoin issuer to maintain identifiable reserves backing the outstanding payment stablecoins of the permitted payment stablecoin issuer on at least a 1 to 1 basis with reserves comprising certain high-quality assets specified in the Act. Section 4(a)(4)(A) of the Act (12 U.S.C. 5903(a)(4)(A)) requires the OCC, among other regulators, to issue regulations to implement certain liquidity standards as well as reserve asset diversification and interest rate risk management standards that are tailored to the business model and risk profile of permitted payment stablecoin issuers and do not exceed the standards that are sufficient to ensure the ongoing operations of permitted payment stablecoin issuers. Section 10 of the GENIUS Act (12 U.S.C. 5909) also imposes requirements on the “Custody of Payment Stablecoin Reserve and Collateral,” including restrictions on commingling certain assets. Consistent with these various sources of authority, the proposed rule included requirements related to reserve assets in several sections, including proposed § 15.11 (“Reserve Assets”), § 15.13 (“Risk Management”), and subpart C (“Custody”). Proposed subpart C’s custody requirements would have applied to OCC￾regulated custodians while proposed § 15.11’s reserve asset requirements would have applied to OCC-regulated permitted payment stablecoin issuers. These requirements mirror each other but

apply to distinct sets of entities (the permitted payment stablecoin issuers placing the reserve assets and the custodians holding them). Proposed § 15.11 set forth (a) requirements relating to ensuring that there are sufficient reserves backing a payment stablecoin, (b) the assets eligible to serve as reserve assets, (c) diversification and concentration requirements, (d) minimum insured deposit requirements, (e) monthly reporting requirements, (f) monthly certification requirements, and (g) requirements relating to the failure to maintain the required minimum amount of reserve assets. With respect to diversification and concentration risk, the proposed rule presented two options: Option A (a principles-based general requirement coupled with a quantitative safe harbor) and Option B (mandatory quantitative minimums). The proposed rule also included risk management requirements related to reserve assets, including liquidity and interest rate risk management. Many commenters offered general comments on the proposed liquidity, diversification, and concentration requirements. Several of these commenters recommended that reserve and redemption requirements should be clear or strict to protect consumers and reduce run risk, and these commenters generally recommended that liquidity requirements should be in line with those that apply to banks. One commenter stated that the proposed rule’s emphasis on high￾quality reserves, segregation of assets, defined redemption timelines, and operational backstops is directionally supportive of credit stability. A few commenters stated that the proposed liquidity and diversification requirements were overly strict or inflexible. One of these commenters also argued that the GENIUS Act grants the OCC authority to require reserve asset diversification but not diversification across reserve asset custodians. One commenter stated that liquidity, diversification, and concentration

requirements are not adequate to prevent the risk of stablecoins “breaking the buck” and that only capital protections are adequate to address those losses. One commenter stated that liquidity requirements should focus on the speed and reliability of monetizing assets since the relevant stress scenario for permitted payment stablecoin issuers is a surge in redemption rather than deterioration in asset quality. Another commenter recommended that liquidity requirements be tiered based on issuer size. One commenter stated that reserve composition requirements do not address the liquidity-during￾receivership gap demonstrated by the failure of Silicon Valley Bank. A few commenters stated that concentration requirements should be calibrated to existing supervisory expectations to avoid duplicative burdens. One commenter argued that concentration risk should be assessed together with the quality and operational reliability of the counterparty, as it may be safer for large-scale issuers to rely on concentrated exposure to a stronger, better integrated institution that can provide operational liquidity at sufficient scale to satisfy timely redemption. One commenter favored a principles-based approach to concentration and diversification in lieu of fixed limits, and this commenter cautioned that concentration and diversification requirements could push reserve assets to institutions with less operational capability to manage and deploy reserve assets. One commenter recommended addressing concentration risk by requiring larger issuers to report sector-level concentrations. A few commenters recommended against adding additional categories of risk to be considered beyond credit, liquidity, interest rate, and price risk. One of these commenters stated that counterparty risks can be better addressed through the examination process than with quantitative limits. After carefully considering the comments received, the OCC is revising § 15.11 to provide additional flexibility while still including certain core requirements intended to ensure

that payment stablecoins remain appropriately reserved at all times and available to meet redemptions. A detailed description of the proposed rule and changes to it, including the OCC’s reasoning for any changes, follows. At a high level, the OCC is adopting a principles-based approach with respect to reserve asset diversification and concentration requirements supplemented by two quantitative requirements designed to ensure a minimum amount of daily liquidity and avoid excessive concentration with respect to a single counterparty (e.g., to address the possibility of operational disruptions at certain counterparties and to mitigate potential credit risk posed by certain counterparties). The final rule also includes additional provisions designed to ensure that permitted payment stablecoin issuers are able to monetize reserve assets in stressed conditions, including new stress-testing provisions in § 15.13, and provisions relating to the use of custodians.
i. Description of Proposed Rule
Proposed § 15.11(a)(1) would have required that permitted payment stablecoin issuers maintain reserve assets that: (i) are identifiable; (ii) are segregated from and not commingled with other assets owned or held by the permitted payment stablecoin issuer; (iii) at all times have a total fair value that equals or exceeds the outstanding issuance value of the permitted payment stablecoin issuer; and (iv) are either held directly by the permitted payment stablecoin issuer or within the custody of an eligible financial institution. To maintain reserve assets that are “identifiable” and comply with proposed § 15.11(a)(1)(i), permitted payment stablecoin issuers would have needed to maintain appropriate records to ensure documented ownership and legal entitlement to individual reserve assets. Similarly, any ownership arrangements, including ownership of assets held via custodians, must comply with applicable laws and regulations, for example, requirements applicable to customer securities owned through the Fedwire Securities

Service. An issuer would have been required to maintain the appropriate operational capabilities, internal controls, policies, and safeguards to ensure that stablecoins are always backed by reserves on an at least 1 to 1 basis. Among other things, safeguards could include mechanisms to prevent the issuance of abnormally large amounts of new payment stablecoins without additional approvals. To comply with the requirement in proposed § 15.11(a)(1)(ii), a permitted payment stablecoin issuer would have needed to ensure that reserve assets were appropriately segregated from and not commingled with other assets owned or held by the permitted payment stablecoin issuer. To comply with the requirement in proposed § 15.11(a)(1)(iii), a permitted payment stablecoin issuer would have needed to ensure that the fair value of reserve assets equaled or exceeded the outstanding issuance value of the permitted payment stablecoin issuer. Proposed § 15.11(a)(1)(iv) would have required that the reserve assets must either be held directly by the permitted payment stablecoin issuer or within the custody of an eligible financial institution, which is defined in proposed § 15.2. Proposed § 15.11(a)(2) would have required that a permitted payment stablecoin issuer demonstrate the operational capability to access and monetize the identifiable reserve assets, commensurate with the permitted payment stablecoin issuer’s risk profile and business model. The issuer would have needed to be able to monetize the reserve assets, potentially quickly and at short notice, in order to meet redemption requests. To comply with proposed § 15.11(a)(2), a permitted payment stablecoin issuer would have needed to be able to demonstrate the ability to monetize all types of reserve assets it maintains.

Proposed § 15.11(a)(3) included requirements for when permitted payment stablecoin issuers could withdraw reserve assets in excess of outstanding issuance value. In order to ensure that, at all times, sufficient reserve assets are maintained to back outstanding stablecoin issuance, permitted payment stablecoin issuers would have been permitted to withdraw excess reserve assets only after the monthly examination and certification required by section 4(a)(1) of the GENIUS Act (12 U.S.C. 5903(a)(1)) and provided for in proposed § 15.11(e) and (f). Specifically, permitted payment stablecoin issuers would have been able to withdraw any surplus reserve assets in excess of outstanding issuance value, calculated and reported as of the last day of the previous month, only upon the publication of that month’s public disclosure, due at the end of the subsequent month. Proposed § 15.11(a)(3) would have also required that, while withdrawals would be based on calculations as of the end of the previous month, a permitted payment stablecoin issuer could only make withdrawals if the remaining reserve assets remained at least equal to the current outstanding issuance value, calculated as of the day of withdrawal.
ii. Description of Comments and the Final Rule
Commenters expressed different views regarding proposed § 15.11(a)(1)(iii)’s requirement that permitted payment stablecoin issuers maintain reserves that “[a]t all times have a total fair value that equals or exceeds the outstanding issuance value of the permitted payment stablecoin issuer,” both regarding the “at all times” standard and the potential propriety of alternative valuation methodologies. Regarding the “at all times” standard, some commenters supported a real-time valuation standard, noting that proof of reserves technologies can provide near-real-time information regarding reserves. Some of the commenters further noted that the OCC should allow permitted payment stablecoin issuers to rely on continuous, cryptographically verifiable on-chain

attestations provided by eligible custodians to fulfill this requirement. However, other commenters believed that the language was ambiguous, that a strictly real-time valuation standard would introduce unnecessary complexity, be impractical and, in some cases, may be impossible, based on underlying technology, intra-day asset value fluctuations, and settlement or clearing timing differences, and would be out of step with how other assets are valued. These commenters instead supported an end-of-day standard as more practical and effective. Regarding the valuation of reserve assets, some commenters noted that fair value may not be applicable in all cases. These commenters noted examples such as money market mutual funds, which are measured at their net asset value, and reverse repo agreements, which may be carried at cost less impairment. Some commenters recommended allowing valuation using amortized cost. The OCC requested comment on whether “the proposed rule [should] include additional measures to ensure that reserve assets are appropriately traceable and linked to their corresponding stablecoin so as to avoid any difficulties in resolving claims to reserve assets.” One commenter responded that such traceability would be operationally impractical and would not have a commensurate risk management benefit. The OCC agrees and has not adopted any additional regulation text requiring that reserve assets be traceable and linked to their corresponding payment stablecoin for these reasons. The OCC notes, however, that permitted payment stablecoin issuers must maintain identifiable reserves backing the outstanding value of payment stablecoins. 75 One commenter requested that the OCC clarify the permissibility of automated reserve asset management systems, including those executed via smart contracts. 75 See 12 U.S.C. 5903(a)(1)(A).

After careful consideration of the comments, the OCC is finalizing § 15.11(a)(1) with one minor change. The final rule replaces a reference to “total fair value” with the new defined term “reserve asset value.” The final rule continues to require an issuer to maintain reserve assets, the value of which equals or exceeds the outstanding issuance value of the permitted payment stablecoin issuer at all times. This requirement follows directly from section 4(a)(1)(A) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)). The final rule also continues to require reserve assets to be valued at fair value (with the exception of United States coins and currency, which must be valued at par) as a result of the new defined term “reserve asset value.” Valuing reserve assets at fair value (i.e., market value) will help ensure that the reserve assets maintained by the permitted payment stablecoin issuer reflect current prices and will be monetizable at a value sufficient to meet any redemption requests at par value. The OCC notes that “outstanding issuance value” is based on the total par value of all of a permitted payment stablecoin issuer’s payment stablecoins rather than on the fair value of the outstanding issued payment stablecoin. Thus, if the fair value of the payment stablecoin decreased (i.e., if the payment stablecoin de-pegged in the secondary market), the permitted payment stablecoin issuer would nevertheless be obligated to retain a stock of reserve assets, the fair value of which equals or exceeds the par value of outstanding payment stablecoins. Taking a contrary approach (e.g., basing the outstanding issuance value on the fair value of payment stablecoins) would be inconsistent with the plain text and goals of the GENIUS Act. 76 Moreover, such an approach could allow permitted payment stablecoin issuers to inappropriately remove assets from the required stock of reserve assets when stablecoins de-peg (as reserve asset requirements decline, along with the secondary market price of the stablecoin), 76 Id.

rather than maintaining the reserve assets on behalf of stablecoin holders, which may in turn exacerbate run risk for a permitted payment stablecoin issuer. In response to certain comments, the OCC confirms that permitted payment stablecoin issuers may use automated reserve asset management systems provided that the systems used conform to the requirements of §§ 15.11, 15.13, and 15.14 as well as any other applicable requirements in part 15. The OCC notes that it anticipates that reserve assets generally will be recorded on the permitted payment stablecoin issuer’s balance sheet under GAAP and be included in the quarterly reports required under proposed § 15.14(i) and on Call Report Schedule RC, Balance Sheet, for a parent insured national bank or Federal savings association. Several commenters addressed the requirement in proposed § 15.11(a)(3) that a permitted payment stablecoin issuer may only “withdraw any surplus reserve assets in excess of outstanding issuance value once per month, upon publication of the composition report required.” Many commenters requested clarifications or amendments to this proposed requirement. Some commenters noted that the requirement may have unintended consequences—for example, it may disincentivize issuers holding excess reserves since the rule would impose a significant delay should the issuer decide to withdraw some amount of such excess. Other commenters suggested that the end-of-month timing may incentivize issuers to increase their reserves at month’s end. One commenter argued that surplus reserve withdrawals should be calculated based on the present value of the reserves, rather than the value reported for the prior month. The commenter stated that this approach would decrease risk that withdrawals cause the reserve assets to fall below the 1 to 1 ratio. Still another commenter requested clarification as to whether withdrawals may only occur on the actual day of the specified report in § 15.11(e) (discussed below).

Some commenters requested clarity on when an asset becomes a reserve asset and recommended adding requirements concerning the handling of funds prior to the point at which they become reserve assets. Some commenters advocated for requiring reserve principal, earnings, and interest to remain identifiable and traceable until the issuer verifies the existence of excess and completes an authorized withdrawal procedure. Others opposed treating interest generated from reserve assets as reserve assets, stating that such treatment is not mandated by statute. Some argued in favor of treating customer funds as reserve assets immediately on receipt of such funds. Relatedly, several commenters expressed views on the propriety of charging expenses related to management of the reserve assets against the reserve assets. Many commenters stated that, as a general matter, such expenses should not be chargeable against the reserve assets. However, several commenters offered exceptions, for example, one commenter noted that transaction-related expenses, such as interest on repurchase agreements or investment management fees, should be chargeable against the reserve assets. Another commenter stated that management should have discretion as to the use of excess reserves if the use of such excess reserve assets is subject to an appropriate policy or agreement. Several commenters noted the importance of liquidity planning regarding reserve assets in addition to an issuer’s broader risk management obligations. Several commenters, for example, suggested that permitted payment stablecoin issuers should be required to adopt written plans, policies, and procedures related to liquidity planning, noting the importance of formal documentation in forcing an issuer to identify risks in advance, assign responsibility, and assess contingency options prior to stress arising. Other commenters discussed specific contingency planning issues, such as Federal Reserve discount window or Federal Home Loan Bank lending

access for certain issuers or mandated recovery and resolution plans. Still other commenters noted that liquidity and contingency plans should be tailored to an issuer’s operational and risk profile or should take into account any related liquidity planning that an issuer may already be subject to under other regulations. Other commenters noted that it is also important for permitted payment stablecoin issuers to plan for interest rate and credit risk regarding reserve assets. For example, commenters suggested that the OCC require written interest rate and credit risk management plans, policies, and procedures. However, other commenters stated that the asset diversification and concentration expectations in the proposal are sufficient to address interest rate and liquidity risk. Commenters also suggested that the OCC provide guidance on liquidity, interest rate, and credit risk management, including, for example, expectations regarding liquidity depth, redemption flow, measurement methodologies, risk appetites, counterparty due diligence, the unique risks posed by custodians and other intermediaries, and other topics related to reserve asset risk management. In addition to the reserve asset risk management requirements included in the proposed regulation itself, the proposed rule requested comment on two specific potential requirements:
stress testing and buffers. The OCC requested comment on whether permitted payment stablecoin issuers should be required to conduct stress tests, including as to their management of liquidity and interest rate risk. Commenters largely supported the use of stress tests as a risk management tool, though commenters differed on their views as to how any stress-testing expectations should be implemented in the regulation. Numerous commenters stated that the OCC should expressly require permitted payment stablecoin issuers to undertake liquidity and interest rate risk stress tests, with some commenters providing proposed standards (e.g.,

documentation requirements, thresholds issuers would be expected to meet, consequences for failing to meet such thresholds) or scenarios. One commenter suggested that a stress testing requirement could substitute for the weighted average maturity requirement (or safe harbor) in proposed § 15.11(c). Relatedly, several commenters suggested broader “monetization testing” to ensure that issuers’ channels for converting reserve assets into liquid funds are operational and reliable under normal and stressed circumstances. Finally, one commenter suggested that the OCC design and conduct multi-issuer stress tests prior to the effective date of the GENIUS Act and publish the results. Other commenters noted the utility of stress testing but stated that the OCC should not impose prescriptive requirements but rather adhere to a principles-based approach, under which stress testing may be an appropriate risk-based approach for an issuer depending on its characteristics. One commenter stated that any stress testing requirements would be better issued at a later date after the OCC gains experience supervising permitted payment stablecoin issuers and an understanding of the potential utility of such stress tests. The proposed rule noted that it “includes robust liquidity requirements but does not include capital-based overcollateralization or reserve asset buffer requirements. An alternative possibility would be to remove some of the proposed liquidity requirements, though this may warrant increased capital or buffer requirements.” Additionally, the OCC posed several questions to commenters on how such an approach might be handled. 77 Several commenters requested that the OCC require a permitted payment stablecoin issuer to hold a “buffer” of reserve assets—that is, to overcollateralize its reserves or apply haircuts against the values of certain reserve assets— such as a standardized across-the-board 1 percent buffer or a codification of the Fixed Income 77 For example, question 46 in the proposed rule asked more detailed questions about whether a reserve buffer was warranted.

Clearing Corporation Government Securities Division Clearing Fund haircut schedule published by the Depository Trust & Clearing Corporation for United States Treasuries. Others rejected standardized approaches, arguing that they are inconsistent with the GENIUS Act’s tailoring requirement. These commenters instead suggested that any buffers be specific to an issuer based on the facts and circumstances or else discussed the relative benefits of buffers in the GENIUS Act reserve asset context since such assets are generally low-risk assets. Some commenters also recommended that the OCC explicitly address in guidance that both the monetization capability standard and the diversification framework are intended to be jointly satisfiable, and that supervisory assessments will take into account the operational constraints that diversification arrangements may place on monetization capability. After careful review of the comments, the OCC has made several changes to § 15.11(a)(2) and (3) and added new paragraph (a)(4) to the final rule. As discussed below, the final rule reduces the number of quantitative requirements relating to reserve asset liquidity, diversification, and concentration from the number that were included in Option B of the proposed rule. To ensure that permitted payment stablecoin issuers remain adequately reserved, the OCC is balancing these reduced quantitative requirements with new provisions emphasizing the ability of a permitted payment stablecoin issuer to maintain the appropriate level of reserve assets and to monetize those assets. Some of those provisions, including those relating to stress testing, are also addressed in the final rule’s risk management provisions. Paragraphs (a)(2) through (4) also provide certain clarifications in response to comments. Paragraph (a)(2) of the final rule’s § 15.11 requires a permitted payment stablecoin issuer to demonstrate the operational capability to access and monetize the identifiable reserve assets to meet redemptions, in both normal and adverse economic, liquidity, market, and interest rate

conditions, commensurate with the permitted payment stablecoin issuer’s risk profile and business model, taking into account, among other relevant factors, market access, financing channels, haircut assumptions, and operational readiness. Depending on a permitted payment stablecoin issuer’s size, risk profile, business model, activities, and operations, a permitted payment stablecoin issuer may be able to demonstrate monetization in different ways. For example, it may be sufficient for some permitted payment stablecoin issuers to demonstrate the ability to monetize Treasury bills they hold as reserve assets by establishing that they maintain appropriate repurchase arrangements through which they can quickly sell Treasury bills and receive liquid funds with which they can satisfy redemption requests. For other permitted payment stablecoin issuers, for example, larger permitted payment stablecoin issuers or permitted payment stablecoin issuers with more complicated operations, additional measures may be appropriate to demonstrate the operational capability to monetize. It may be appropriate for such permitted payment stablecoin issuers to maintain multiple alternative methods of monetization (for example, multiple repurchase agreement lines or repurchase agreement lines plus arrangements allowing outright sales of Treasury securities) to satisfactorily demonstrate the ability to monetize their reserve assets. Such redundant arrangements may be necessary if a permitted payment stablecoin issuer maintains a sufficiently large Treasury position that it could be difficult to monetize the entire position through transactions with a single repo counterparty or if a permitted payment stablecoin issuer maintains concentrated positions in particular types of reserve assets. The availability of multiple monetization channels is intended to help ensure that a permitted payment stablecoin issuer is not required to monetize assets at reduced or “fire sale” prices. Having alternative monetization

channels reduces the risk that a permitted payment stablecoin issuer would be obliged to accept unfavorable pricing when monetizing reserve assets under stress. For certain permitted payment stablecoin issuers, it may be appropriate to periodically conduct actual monetization transactions (that is, actual outright sales or repurchase transactions) in order to demonstrate the ability to monetize. Actual transactions can more fully confirm that monetization capabilities exist. In the absence of actual test transactions, potential barriers to monetization may still exist. Permitted payment stablecoin issuers may be unfamiliar with or lack the procedures and systems to monetize assets at any time in accordance with standard settlement periods and processes. For example, internal staff may be unprepared to execute procedures, or borrowing agreements may name authorizing officials who are unavailable or inappropriate. Actual monetization transactions may be appropriate, for example, for permitted payment stablecoin issuers with unusually complicated operations or organizational structures, or for permitted payment stablecoin issuers that are particularly dependent on certain monetization channels or the ability to monetize particular assets. Periodic actual monetization transactions can minimize the risk of negative signaling during financial stress and help prepare the issuer to move quickly if necessary to acquire additional liquidity. If a permitted payment stablecoin issuer begins using a monetization channel that it has not regularly used in the past, that may spark concerns about the financial health of the issuer. For example, if a permitted payment stablecoin issuer has pre-established a repurchase agreement with a bilateral counterparty but never utilized it, sudden utilization of the repurchase agreement may generate concerns that the issuer is experiencing a run on its stablecoins. Periodic test transactions using multiple monetization channels can mitigate such concerns and may be particularly important for large, systemically important issuers where concerns about financial

distress are more likely to contribute to contagion. Permitted payment stablecoin issuers may be able to demonstrate the ability to execute actual monetization transactions in the ordinary course of their business (for example, redeeming stablecoins) and would not necessarily be required to engage in additional test transactions. Paragraph (a)(3) of the final rule’s § 15.11 requires a permitted payment stablecoin issuer to ensure that reserve asset value will continue to equal or exceed outstanding issuance value at all times and that the reserve asset portfolio will be capable of supporting timely redemption under both normal conditions and adverse economic, liquidity, market, and interest rate conditions, including, to the extent necessary, maintaining a buffer of reserve assets in excess of outstanding issuance value. This requirement will provide permitted payment stablecoin issuers flexibility in composing their reserve asset portfolio while ensuring that permitted payment stablecoin issuers are able to maintain 1 to 1 backing at all times. The final rule does not mandate a particular buffer level but makes clear that such a buffer may be appropriate, depending on the makeup of the reserve asset portfolio of a permitted payment stablecoin issuer. Permitted payment stablecoin issuers with certain reserve asset portfolios may not be required to maintain any buffer, or only a small buffer, in order to comply with paragraph (a)(3), for example, reserve asset portfolios consisting entirely of reserve assets that represent immediately available liquidity, such as deposits payable upon demand. In contrast, it may be necessary for permitted payment stablecoin issuers with longer-duration reserve asset portfolios to maintain a more substantial buffer. 78 78 The proposed rule described how an interest rate increase of the magnitude experienced in the early 1980s would result in a 90-day security losing approximately .79 percent of its value. See Fed. Reserve Econ. Data, “Table Data—3-Month Treasury Bill Secondary Market Rate, Discount Basis,” https://fred.stlouisfed.org/data/WTB3MS (including Treasury Bill secondary market rates for February 8, 1980, and March 7, 1980, with an increase from
12.05 percent to 15.37 percent between those dates). While some commenters objected that the interest rate increase

Paragraph (a)(4) of the final rule’s § 15.11 modifies proposed § 15.11(a)(3). Under this paragraph of the final rule, a permitted payment stablecoin issuer may only withdraw reserve assets in excess of outstanding issuance value after appropriate due diligence and confirmation that the withdrawal would not cause the reserve asset value to fall below outstanding issuance value, calculated as of the time and date of withdrawal. In response to comments, the revised paragraph provides additional flexibility, especially with respect to timing, to permitted payment stablecoin issuers with respect to removing reserve assets in excess of outstanding issuance value while facilitating the OCC’s key goal of ensuring that permitted payment stablecoin issuers meet, at all times, their obligations under section 4(a)(1)(A) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)). The final rule also does not apply the withdrawal limitation in § 15.11(a)(4) to income earned on reserve assets. However, the OCC emphasizes that assets serving as reserves must be identified as such by the permitted payment stablecoin issuer and that, in no situation may a permitted payment stablecoin issuer have an outstanding issuance value that exceeds its reserve asset value. For example, a permitted payment stablecoin issuer may be able to direct income earned on a reserve asset outside the portfolio of reserve assets while maintaining the principal of the reserve asset inside the portfolio. Any such procedures must comply with the requirements of the final rule, including the requirements in § 15.11(a)(1)(i) that reserve assets be “identifiable” and § 15.11(a)(1)(ii) that reserve assets be “segregated from and not commingled with other assets owned or held by the permitted payment stablecoin issuer.” experienced in the early 1980s was unlikely to recur, the OCC believes that an interest rate increase of this magnitude represents a plausible adverse scenario for which issuers may be required to plan, depending on their portfolio of reserve assets.

Consistent with § 15.11(a)(3) of the final rule, a permitted payment stablecoin issuer may, depending on various factors, also need to hold a buffer to ensure that its reserve asset value will continue to equal or exceed its outstanding issuance value. Accordingly, a permitted payment stablecoin issuer must ensure that a withdrawal of reserve assets does not cause the issuer to violate § 15.11(a)(3) or (a)(4) of the final rule. 79 A permitted payment stablecoin issuer may choose to hold funds that back minted, but not yet issued payment stablecoins, either as reserve assets or not as reserve assets, but upon issuance of the payment stablecoin, the payment stablecoin must be backed by identifiable reserve assets.
c. Reserve Asset Composition (§ 15.11(b))
i. Description of Proposed Rule
Under proposed § 15.11(b), reserve assets would have comprised only: (1) United States coins and currency (including Federal Reserve notes) or money standing to the credit of an account with a Federal Reserve Bank; (2) funds held as deposits or insured shares payable upon demand at an insured depository institution (including any foreign branches or agents, including correspondent banks, of an insured depository institution), subject to any limitation established by the FDIC and the National Credit Union Administration, as applicable, pursuant to section 4(a)(1)(A)(ii) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)(ii)) to address safety and soundness risks of such insured depository institution; (3) Treasury bills, Treasury notes, or Treasury bonds with a remaining maturity of 93 days or less; 80 (4) money received under repurchase agreements, 79 In addition, to the extent that an issuer relies on income earned on reserve assets to meet its required reserve asset value, the income would be subject to the requirements of § 15.11(a)(4). Issuers should consider the effect of withdrawals on the fair value, and consequently the reserve asset value, of their reserve assets. 80 Section 4(a)(1)(A)(iii) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)(iii)) permits the inclusion of Treasury bills, notes, or bonds “(I) with a remaining maturity of 93 days or less; or (II) issued with a maturity of 93 days or less.” The proposed rule combined these categories since the former category includes the latter, at least for purposes of complying with the requirements of proposed § 15.11. Permitted payment stablecoin issuers may choose to categorize these assets separately for other reasons, for example accounting or risk management purposes. For clarity, the 93-day limitation begins as of the settlement date of the purchase of the Treasury securities.

with the permitted payment stablecoin issuer acting as a seller of securities and with a no longer than overnight maturity, that are backed by Treasury bills with a maturity of 93 days or less; 81 (5) reverse repurchase agreements, with the permitted payment stablecoin issuer acting as a purchaser of securities and with a no longer than overnight maturity, that are collateralized by Treasury bills, Treasury notes, or Treasury bonds on a no longer than overnight basis, subject to overcollateralization in line with standard market terms, that are: (i) tri-party; (ii) centrally cleared through a clearing agency registered with the Securities and Exchange Commission; or (iii) bilateral with a counterparty that the issuer has determined to be adequately creditworthy even in the event of severe market stress; (6) securities issued by an investment company registered under section 8(a) of the Investment Company Act of 1940 (15 U.S.C. 80a-8(a)), or other registered Government money market fund, and that are invested solely in underlying assets described in proposed § 15.11(b)(1) through (5); 82 (7) any other similarly liquid Federal Government-issued asset approved by the OCC, in consultation with the State payment stablecoin regulator, if applicable, of the permitted payment stablecoin issuer; or (8) any reserve described in proposed § 15.11(b)(1) through (3), (6), or (7), in tokenized form, provided that such reserves comply with all applicable laws and regulations. In determining whether a potential reserve asset qualifies as “any other similarly liquid Federal Government-issued asset,” under proposed § 15.11(b)(7) the OCC would have considered, among other relevant factors, whether: (i) the asset has liquidity characteristics, 81 The proposed rule clarified that a repurchase agreement or reverse repurchase agreement with an intraday maturity could qualify as a permitted reserve asset. Sections 4(a)(1)(A)(iv) and (v) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)(iv) and (v)) specifically refer to repurchase agreements and reverse repurchase agreements with an overnight maturity. The OCC believes that these provisions are intended to permit repurchase agreements and reverse repurchase agreements with a maturity no longer than overnight. Thus, the proposed rule would have explicitly permitted the use of intraday repurchase agreements and reverse repurchase agreements. 82 A money market fund that invests in any other assets, including in Treasury securities with a remaining maturity longer than 93 days, would not be eligible to be held as a reserve asset.

including during times of stress, comparable to the other reserve assets allowed under proposed § 15.11(b); (ii) permitted payment stablecoin issuers will be operationally capable of monetizing the asset to meet redemption requests, including sudden and high-volume requests; (iii) the asset poses levels of risk comparable to the assets allowed under proposed § 15.11(b), including interest rate risk and counterparty credit risk; and (iv) the asset introduces additional risks that may be difficult for permitted payment stablecoin issuers to manage.
ii. Description of Comments and the Final Rule
A few commenters generally favored the reserve asset composition set forth in the OCC’s proposed rule. One commenter recommended that issuer reserves should be permitted to be composed entirely of Treasuries, overnight Treasury repurchase agreements, and their equivalents, considering their low credit risk. Another commenter recommended that all permitted payment stablecoin issuers should be required to hold a majority of their reserves as deposits in insured depository institutions and Treasuries with a remaining maturity of no longer than 93 days. Physical Currency Overall, commenters supported limited recognition of physical currency, subject to basic safeguards rather than detailed prescriptive requirements. A few commenters addressed physical currency and generally suggested that the OCC adopt a simple, principles-based approach because physical currency is unlikely to serve as a significant reserve asset in practice. One commenter stated that any physical currency held as a reserve asset should be valued at par. Another commenter noted that physical currency should be permitted only within defined limits, such as a small percentage of total reserves and potentially subject to geographic distribution requirements, while recognizing that some operating balance in physical currency may be practical for smaller issuers.

The final rule does not impose direct limits on the use of physical currency in § 15.11(b)(1) or elsewhere, but, as discussed above, physical currency must be valued at face value (rather than fair market value). In addition, risk management considerations, in particular operational risk, will likely discourage the extensive use of physical currency as reserve assets. 83 Reserve Bank Balances Overall, commenters generally supported greater clarity on the treatment of reserve bank balances but differed on whether such balances should receive preferential treatment or be subject to concentration safeguards. Several commenters suggested that reserve bank balances be exempt from concentration limits and argued that balances at Federal Reserve Banks do not present credit risk and that treating reserve banks like insured depository institutions would impose unnecessary operational constraints without corresponding safety benefits. A few commenters stated that the OCC should work with the Federal Reserve to permit an operating subsidiary of an insured depository institution to open a master account directly or maintain a designated sub-account of its parent institution’s Federal Reserve master account. In contrast, one commenter stated that exempting Federal Reserve master accounts from concentration limits could confer a competitive advantage on banks and urged the OCC to revisit the issue after the Federal Reserve further addresses payment account implementation or clarifies master account eligibility. Another commenter stated that, if a permitted payment stablecoin issuer were to obtain master account access, the OCC should limit the share of reserve assets that may be held at a Reserve Bank. 83 See, e.g., OCC, Comptroller’s Handbook, “Cash Accounts” 5-25 (1998) (discussing cash account risk management considerations in OCC exam procedures); OCC, Comptroller’s Handbook, “Custody Services” 6-8 (2002) (discussing custody services risk management considerations).

As discussed below, the final rule, like the proposed rule, imposes a 40 percent single counterparty limit with respect to money standing to the credit of a Federal Reserve Bank. The OCC determined that, although Federal Reserve Banks do not present counterparty credit risk, providing preferential treatment for the placement of reserve assets at Federal Reserve Banks could implicate financial stability risks. In times of stress, permitted payment stablecoin issuers may generally have an incentive to move reserve assets out of commercial banks and into Federal Reserve Banks. Imposing a 40 percent single counterparty limit on commercial banks but not Federal Reserve Banks could exacerbate this dynamic. This flight could also lead to increased money market volatility and potentially impede the transmission of monetary policy. Thus, consistent with the OCC’s authority and mandate under section 4(b) of the GENIUS Act (12 U.S.C. 5903(b)) to ensure financial stability, the final rule applies a 40 percent single counterparty limit with respect to money standing to the credit of a Federal Reserve Bank. Although the OCC has coordinated and will continue to coordinate with the Federal Reserve in the agencies’ implementation of the GENIUS Act, the OCC declines to provide guidance on Federal Reserve master account structures, consistent with its approach to national banks, as master account access is outside the OCC’s statutory authorities. Deposits Some commenters suggested that permissible reserve assets should include a broader range of deposit arrangements, including ordinary deposit and settlement accounts. To emphasize that settlement accounts are a routine and important part of reserve operations, some commenters stated that reserves should not be limited to custody account arrangements. Other commenters stated that the term “demand deposit” should be interpreted to include money market deposit accounts and similar deposits that may not formally qualify as demand deposits,

so long as the permitted payment stablecoin issuer can withdraw the funds at any time. One commenter stated that this interpretation is necessary to give effect to the concept of funds being “payable on demand” and would broaden the range of depository institutions permitted to hold reserve assets, including industrial loan companies that may not accept demand deposits. A few commenters opposed requiring or encouraging reserve assets to be held as insured deposits or shares, arguing that: (i) deposit insurance resources are not designed to support stablecoin volumes, (ii) increased coverage could raise unfair assessment burdens on banks, (iii) payment stablecoins are not deposits, and (iv) diversification into bank deposits could increase risks to the banking system. One commenter also cautioned that uninsured deposits are neither risk-free nor always highly liquid. A few commenters addressed insurance-related issues for reserve assets and generally urged greater clarity regarding the treatment and risks of insured and uninsured deposits. One commenter recommended that the OCC explore a supplemental excess deposit insurance or guarantee mechanism for stablecoin reserve deposits held in trust for payment stablecoin holders. Some commenters argued against permitting uninsured deposits because they would leave stablecoins highly vulnerable to runs. One commenter noted that disclosures should clearly explain the level of protection available for insured and uninsured deposits, including whether tokenized deposits qualify for deposit insurance or whether insurance does not pass through to token holders. One commenter also referenced the American Institute of Certified Public Accountants’ (AICPA) stablecoin criteria as supporting explicit disclosure where deposit insurance does not pass through to the token holder. A few commenters urged the OCC not to categorically limit reserve deposits to United States insured depository institutions and instead to permit deposits held through foreign banking

organizations, foreign branches, or correspondent banking arrangements under appropriate conditions. Some commenters stated that the statute permits deposits to be maintained at foreign banking organizations, including where those institutions maintain correspondent accounts with United States insured depository institutions. Some commenters stated that foreign banks operating in the United States should receive national treatment and thus should be allowed to conduct the same activities as United States financial institutions. Other commenters stated that permitted payment stablecoin issuers may have legitimate operational needs for reserves in non￾U.S. locations, including to meet requirements established under reciprocal arrangements. Several commenters stated that restricting U.S. dollar-denominated payment stablecoins to demand deposits at United States-based depository institutions would be disproportionate, commercially harmful, and inconsistent with a competitive and accessible stablecoin framework. Some commenters argued that the rule should avoid blanket haircuts or capital charges on reserve assets held at foreign branches or correspondent banks and instead require issuers to maintain documented risk management frameworks addressing the risks of such arrangements. One commenter urged the OCC to specify the conditions under which Eurodollar deposits would be appropriate in a manner that minimizes interference with free competition and to apply any restrictions on foreign branches, agents, or correspondent banks equally to U.S.- and foreign￾headquartered firms. As discussed above, section 4(a)(1)(A)(ii) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)(ii)) permits permitted payment stablecoin issuers to hold demand deposits at insured depository institutions. The definition of insured depository institution under
section 2(15) of the GENIUS Act (12 U.S.C. 5901(15)) and the Federal Deposit Insurance Act
excludes from the scope of permissible reserve assets deposits held at institutions that are not

insured depository institutions under section 3(c)(2) of the Federal Deposit Insurance Act. Accordingly, deposits that are not held at insured depository institutions (regardless of whether the deposits themselves are insured) are not eligible reserve assets. Some commenters also suggested that the OCC clarify that deposit placement networks may be used to hold reserve assets through eligible financial institutions. These commenters argued that such networks can improve diversification, operational efficiency, liquidity, and timely redemptions while also channeling deposits to community banks. One commenter stated that deposit placement networks are unlikely to increase run risk because deposits would be spread across institutions and stablecoins may be less likely to experience concentrated redemptions than some other liabilities. The OCC confirms that permitted payment stablecoin issuers may use deposit placement networks provided that the issuer does so in compliance with applicable requirements, including those in §§ 15.11 and 15.13. For example, if a network’s agreements included limitations on withdrawals that rendered the issuer unable to meet the liquidity demands of customers and to timely redeem tendered payment stablecoins, it would be inappropriate for the permitted payment stablecoin issuer to place amounts of its reserve assets through that deposit placement network that rendered the permitted payment stablecoin issuer unable to comply with the final rule. The final rule does not substantively change the description of funds held as deposits or insured shares payable on demand at an insured depository institution in § 15.11(b)(2). The final rule does, however, more closely match the language of section 4(a)(1)(A)(ii) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)(ii)) by replacing references to deposits payable on demand with demand deposits (or other deposits that may be withdrawn upon request at any time). The OCC notes that existing banking law and regulation use or define similar terms, such as

12 CFR part 204 and section 2 of the BHC Act; as other laws and regulations do not use the same phrasing as the GENIUS Act, may not be within the OCC’s jurisdiction, and are based on different policy purposes, applying definitions, interpretations, or market practices based on other law for purposes of this provision of the Act is not appropriate. In addition, the OCC confirms that a deposit account that allows the bank to require prior notice of withdrawal or limits the number of withdrawals within a period of time would not be a demand deposit or other deposit that may be withdrawn upon request at any time under the GENIUS Act regardless of whether the deposit was treated as a demand deposit under other law. As discussed in greater detail below, the OCC is also eliminating the proposed requirement that certain permitted payment stablecoin issuers hold a set amount of reserves as insured deposits. Permitted payment stablecoin issuers continue to be expected to manage credit and concentration risks, including those regarding insured deposits and insured depository institutions. With respect to deposit insurance, the OCC notes that the FDIC has issued a notice of proposed rulemaking addressing insurance coverage rules in 12 CFR part 330 that apply to all FDIC-insured depository institutions by clarifying that deposits held as reserves backing a payment stablecoin would be insured as to the permitted payment stablecoin issuers under the FDIC’s coverage rules for corporate deposits, but would not be insured to payment stablecoin holders on a pass-through basis. 84 The final rule also neither prohibits nor mandates the use of private deposit insurance. As discussed in the next section, § 15.12 of the final rule also includes additional disclosures, including with respect to deposit insurance, which address several of the commenters’ concerns. 84 91 FR 18534 (Apr. 10, 2026) (FDIC proposed rule for GENIUS Act requirements and standards for FDIC￾supervised permitted payment stablecoin issuers and insured depository institutions).

Treasury Securities
Several commenters recommended permitting reserve assets to consist predominantly or entirely of cash and short-term United States Treasury securities. One commenter stated that at least 80 to 90 percent of existing stablecoin reserves are already held in short-term Treasuries, while another urged that reserves be held 100 percent in Treasuries or cash. Some commenters stated that the effects of reserve requirements on the United States debt markets should be studied and monitored and that the final rule should recognize risks associated with concentration in Treasury securities (e.g., potential financial stability implications if stablecoin issuers become large Treasury investors). In contrast, some commenters suggested that it is not necessary at this stage to impose additional rule-based requirements specifically aimed at preventing disruptions in Treasury markets. Several commenters opposed limits or qualitative distinctions on Treasury holdings, including caps on older or off-the-run securities, arguing that such restrictions would be operationally harmful and unsupported by the risk profile of stablecoin reserve portfolios. One commenter also acknowledged liquidity concerns regarding off-the-run Treasuries but suggested addressing those concerns through existing mechanisms, such as the FICC haircut schedule, rather than through explicit portfolio limits. In § 15.11(b)(3), the final rule does not impose any quantitative requirements with respect to how much of a permitted payment stablecoin issuer’s reserve asset portfolio must comprise Treasury securities. The OCC believes that the changes to § 15.11(a) and the risk management provisions in § 15.13 will be sufficient to ensure that the composition of a permitted payment stablecoin issuer’s portfolio is appropriate. Permitted payment stablecoin issuers will be expected to consider, among other things, the liquidity of a particular Treasury security (e.g., if the Treasury security is off-the-run) in relation to those requirements.

TIPS, FRNs, and STRIPS
A few commenters urged the OCC not to adopt a prescriptive asset-by-asset list and instead to use principles-based eligibility criteria. These commenters suggested that the criteria potentially be supplemented by illustrative examples for Treasury Floating Rate Notes (FRNs), Treasury Inflation-Protected Securities (TIPS), and Separate Trading of Registered Interest and Principal of Securities (STRIPS). Some commenters stated that FRNs should be included as eligible reserve assets, particularly where they have relatively short remaining maturities or otherwise demonstrate sufficient liquidity, emphasizing their limited price volatility, strong secondary market liquidity, and risk characteristics comparable to Treasury bills. Other commenters supported including TIPS, with one commenter noting that TIPS could be used to hedge payment stablecoins pegged to a fixed amount of purchasing power. Another commenter suggested that FRNs and TIPS could be permitted subject to overcollateralization requirements. In contrast, one commenter stated that TIPS and STRIPS are too volatile to qualify as permissible reserve assets. Under § 15.11(b)(3) of the final rule, consistent with the proposal, any Treasury bill, note, or bond with a remaining maturity of 93 days or less may serve as a reserve asset. Thus, FRNs or TIPS with a remaining maturity of 93 days or less may serve as reserve assets. STRIPS are zero-coupon securities created from the individual interest or principal components of a Treasury note or bond. Because STRIPS are merely the individual component payments of Treasury notes, or bonds, and in light of the regulatory regime supporting the ability to reconstitute STRIPS, 85 they may qualify as reserve assets, provided they have a remaining 85 See 31 CFR 356.31.

maturity of 93 days or less under section 4(a)(1)(A)(iii) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)(iii)). Repurchase Agreements and Reverse Repurchase Agreements Many commenters urged the OCC to clarify the permissible use of repurchase agreements and reverse repurchase agreements as reserve assets, including the treatment of collateral, legal enforceability, operational controls, monetization timing, and whether intraday, centrally cleared, and on-chain repurchase agreement structures are permissible. Many commenters emphasized that repurchase agreements and reverse repurchase agreements present meaningful credit, liquidity, and market risks and recommended addressing those risks through counterparty standards, supervisory expectations, liquidity stress testing, and contingency funding planning. One commenter suggested limiting repurchase agreements to roughly 10 to 15 percent of reserves, and another commenter argued that repurchase agreements should not qualify as reserve assets at all because reserve assets should be owned outright. Some commenters stated that cash and deposits, including deposits held at tri-party custodians, should be expressly recognized as eligible collateral because those assets are permissible reserve assets and are commonly used in repo markets. In contrast, one commenter opposed allowing counterparties to pledge deposits and instead argued that reserve pools should receive cash directly into their own bank accounts. A few commenters opposed prescriptive minimum haircut requirements and instead recommended requiring overcollateralization consistent with standard market terms in the United States Treasury repo market, with documentation under industry￾86 For STRIPS, the maturity date is the payment date for each separate principal or interest component. For principal components, the maturity date is the same as the maturity date of the fully constituted (unstripped) Treasury security. For interest components, the interest payment date becomes the maturity date for the component. Treasury provides the CUSIP numbers and payment dates for the principal and interest components in auction announcements and on its website.

standard agreements serving as evidence of compliance. Several commenters requested additional clarity regarding terms such as “severe market stress” and “centrally cleared,” as well as guidance on how issuers should assess bilateral repo counterparty creditworthiness and whether net liquidity measures may account for expected inflows as well as outflows. One commenter opposed limits on repo funding altogether, arguing that repo funding can be more secure than unsecured bank deposits. Another commenter recommended enhanced disclosure and attestation requirements regarding repo counterparty tier, weighted average term, and rollover frequency. Consistent with the statute, § 15.11(b)(4) and (5) of the final rule continue to permit the use of money received under certain repurchase agreements and reverse repurchase agreements as reserve assets. The final rule does not impose any quantitative limit specifically with respect to these reserve asset types (though, as discussed below, counterparty limitations would continue to apply). The OCC recognizes that there are certain risks associated with relying excessively on repurchase agreements to facilitate redemptions (e.g., the risk that a regular repo counterparty will not roll over a repo). The OCC will receive detailed information concerning the makeup of a permitted payment stablecoin issuer’s reserve asset portfolio, including the extent to which a permitted payment stablecoin issuer relies on repurchase agreements through the weekly reporting required in § 15.14. This will provide the OCC with the ability to assess, among other things, whether a permitted payment stablecoin issuer is overly reliant on repo funding and unable to monetize its reserve assets in a timely fashion. In addition, the revisions to § 15.11(a) and § 15.13 should address risks associated with relying excessively on repurchase agreements or reverse repurchase agreements, particularly in times of stress. The final rule also does not provide that money received from repurchase agreements or reverse repurchase agreements may

be backed by cash, consistent with the requirements of section 4(a)(1)(A)(iv) and (v) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)(iv) and (v)). The final rule does not further define what constitutes “standard market terms” in recognition that standard market terms may evolve over time. Additionally, the final rule does not further define what constitutes central clearing, as that term is already sufficiently clear in the statute. The final rule includes one technical change to § 15.11(b)(5), adding the word “or” between “Treasury notes” and “Treasury bonds.” Securities Issued by an Investment Company Several commenters suggested that the OCC limit eligible securities issued by an investment company to registered government money market funds, particularly SEC Rule 2a-7 funds that maintain a stable $1.00 net asset value, satisfy applicable liquidity requirements, and invest solely in assets otherwise permitted as reserve assets. Some commenters stated that prime and municipal money market funds, and more broadly non-government registered investment companies, should be excluded because they introduce credit, liquidity, and structural risks inconsistent with the statutory reserve framework. One commenter argued that money market funds are inherently vulnerable to runs. Several commenters also requested clarification that the phrase “other registered government money market funds” does not expand eligibility beyond funds registered under the Investment Company Act. Some commenters asked the OCC to publish a list of permissible funds and assets. Other commenters urged the OCC to interpret the category more broadly to include other registered funds that hold qualifying assets, including Treasury-focused ETFs, ultra-short Treasury mutual funds, tokenized money market funds, and other funds they suggested were economically equivalent to direct holdings of permissible assets. Commenters noted that government money market funds are already comprehensively regulated under Rule 2a-7 and the Investment Company Act and stated that they therefore should not be

subject to additional OCC diversification or concentration restrictions beyond the statutory framework. Other commenters recommended specific fund-level caps or exposure limits to address concentration risk. A few commenters sought operational clarifications, including that otherwise qualifying funds may hold small amounts of residual cash in other funds for cash management purposes or operate through fund-of-funds or master-feeder structures without losing eligibility. The OCC is finalizing § 15.11(b)(6) as proposed, with some minor technical edits, to ensure consistency with the language in section 4(a)(1)(A)(vi) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)(vi)). Under the final rule, permissible reserve assets include securities issued by an investment company registered under section 8(a) of the Investment Company Act of 1940 (15 U.S.C. 80a-8(a)), or other registered Government money market fund, and that are invested solely in underlying assets described in § 15.11(b)(1) through (5). To qualify under § 15.11(b)(6), an investment company would need to be registered under section 8(a) of the Investment Company Act but need not be a mutual fund. Shares of an exchange traded fund registered under section 8(a) of the Investment Company Act that invested solely in the assets detailed in § 15.11(b)(1) through (5) would constitute eligible reserve assets. As discussed in greater detail below, these funds would nevertheless be subject to reserve asset diversification and concentration requirements addressed in § 15.11(c). These reserve asset and diversification requirements will ensure that a permitted payment stablecoin issuer is not overly reliant on one entity and may, for example, look to other sources to fund redemptions in the event of an operational issue with such a fund. The OCC confirms that “other registered government money market funds” does not expand eligibility beyond funds registered under the Investment Company Act. In addition, the OCC confirms that a fund that invested in other funds would not

meet the eligibility requirements under § 15.11(b)(6) because such a fund would not invest solely in the reserve assets permitted under section 4(a)(1)(A)(i) through (v) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)(i)-(v)). The OCC is finalizing § 15.11(b)(6) as proposed with some minor technical edits to add paragraphs (b)(6)(i) and (b)(6)(ii) to more clearly provide that the securities must be issued by an investment company and invested solely in the underlying assets described in § 15.11(b)(1) through (b)(5). Other Similarly Liquid Federal Government-Issued Assets not Listed in the GENIUS Act and Reserves in Tokenized Form Several commenters urged the OCC to preserve a process for approving additional “similarly liquid” Federal Government-issued assets beyond those expressly listed in the statute and to articulate transparent, principles-based eligibility criteria, rather than relying solely on a fixed prescriptive list. Some commenters stated that the permissible asset universe should be expanded to include longer-dated United States Treasury securities. These commenters argued that in some cases, agency securities remain deep and liquid, would improve portfolio flexibility and yield, and could reduce undue concentration at the short end of the Treasury curve. Several commenters noted that, if longer-dated assets are permitted, the OCC should address the associated interest rate and liquidity risks through tools such as haircuts, weighted-average￾maturity limits, diversification requirements, overcollateralization, stress rebalancing, or redemption controls. A few commenters requested a formal, transparent, and time-limited approval process for additional assets, including public disclosure of determinations, published eligibility criteria, and the ability for any interested party to petition for approval, with some also urging coordination with state and other relevant regulators. In contrast, some commenters

opposed expanding the category to include Treasuries with remaining maturities beyond 93 days, arguing that longer-dated instruments introduce excessive interest rate risk and should not qualify, or should be subject to a portfolio-level weighted average maturity cap of no more than 93 days. A few commenters urged even broader expansion to include assets such as agency obligations, broader Rule 2a-7 government money market fund exposures, debt instruments economically equivalent to Treasuries but issued by third parties, commercial paper, or even other stablecoins. Other commenters argued that any such expansion should occur only after careful safety-and-soundness review and interagency coordination. One commenter suggested that the OCC expand the list of permissible reserve assets to include AAA-rated corporate debt. This commenter suggested that highly rated corporate obligations should be eligible alongside other reserve assets. The final rule includes one technical change to § 15.11(b)(7), to remove the redundant “Whether” from the proposed § 15.11(b)(7)(iv). One commenter recommended that the OCC clarify that for tokenized reserve assets, a covered custodian’s demonstration of control should address both the on-chain custody of the token and the off-chain legal and operational arrangements ensuring the custodian can enforce the customer’s rights against the underlying asset. The definition of “tokenized form” in § 15.2 sufficiently addresses the applicable legal requirements. As described above, a reserve asset in tokenized form must confer rights that are identical to those that would be conferred by a non￾tokenized form of the asset under applicable law. In the case of a tokenized form of an asset under custody, a permitted payment stablecoin issuer should consider the operational capabilities of the custodian as well as the legal rights that the permitted payment stablecoin issuer has in the reserve asset. Some commenters argued against additional quantitative diversification limits on

tokenized reserve assets. Other commenters cautioned that tokenization can introduce operational uncertainty and instability and should be addressed through collateral eligibility standards, disclosure, haircuts, or other risk controls. A few commenters also requested more specific guidance on operational and disclosure issues, including treatment of digitally native assets, explicit confirmation that short-term on-chain Treasuries are permissible, disclosure of both on-chain custody locations and underlying real-world asset custody, and standards for addressing discrepancies between on-chain reserve attestations and off-chain custodian records. One commenter encouraged publishing reserve balances on-chain and eventually supporting programmatic controls that would prevent additional token minting when adequate reserves are not present. The OCC is not including a broad-based haircut for reserve assets in tokenized form in light of the many different features, positive and negative, that a reserve asset in tokenized form may have, depending on its design. Nevertheless, depending on the nature of the tokenized asset (in particular, any operational difficulties associated with monetizing the asset), it may be appropriate for a permitted payment stablecoin issuer to apply a haircut pursuant to its reserve asset and liquidity risk management requirements. The OCC is finalizing § 15.11(b) with minor changes in addition to the non-substantive change to paragraph (b)(2) described above. Specifically, § 15.11(b)(7) now provides that, when the OCC approves the use of “any other similarly liquid Federal Government-issued asset” as a reserve asset, the OCC may impose conditions consistent with the purposes of the GENIUS Act. This addition makes clear, for example, that the OCC may impose conditions (e.g., its maturity) on the use of a particular type of reserve asset to ensure that the asset is truly similarly liquid to the other types of reserve assets contemplated under the GENIUS Act. The OCC is not including corporate securities as permissible reserve assets. These assets are not Federal-Government

issued, and thus section 4(a)(1)(A) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)) does not provide an avenue to permit such assets. The OCC is also making technical edits to § 15.11(b)(8) to delete “or paragraph” as redundant, such that it now reads “Any reserve described in paragraphs (b)(1) through (3), (b)(6), or (b)(7) of this section in tokenized form, provided that such reserves comply with all applicable laws and regulations.” d. Reserve Asset Diversification and Concentration (§ 15.11(c))
i. Description of the Proposed Rule
Section 4(a)(4)(A)(iii) of the Act (12 U.S.C. 5903(a)(4)(A)(iii)) requires the OCC to issue
regulations implementing reserve asset diversification, including deposit concentration at banking institutions and interest rate risk management standards that (1) are tailored to the business model and risk profile of permitted payment stablecoin issuers and (2) do not exceed standards that are sufficient to ensure the ongoing operations of permitted payment stablecoin issuers. The proposed rule included two alternative options to implement these diversification and concentration limits in proposed § 15.11(c). “Option A” included a principles-based general requirement with an optional safe harbor containing quantitative requirements. “Option B” would have made the quantitative requirements mandatory for all issuers. Option A’s principles￾based general requirement would have required a permitted payment stablecoin issuer to maintain reserve assets that are sufficiently diverse to manage potential credit, liquidity, interest rate, and price risks. In addition, the principles-based requirement in Option A in proposed § 15.11(c) would have required a permitted payment stablecoin issuer to measure and manage the risk that concentrating reserve assets at one eligible financial institution or a small number of eligible financial institutions may impair the ability of a permitted payment stablecoin issuer to satisfy redemption demands if individual eligible financial institutions are unable to return, or if

there is a delay in returning, reserve assets placed by a permitted payment stablecoin issuer. 87 The proposed rule’s diversification and concentration requirements would have applied to custodial relationships, including sub-custodial arrangements. Permitted payment stablecoin issuers would have been expected to “look through” any sub-custodial relationships to ensure that reserve assets are custodied at a sufficiently diverse number of eligible financial institutions needed to comply with the proposed rule’s requirements. Option A contained a safe harbor under which a permitted payment stablecoin issuer would be deemed to satisfy proposed § 15.11(c) if the permitted payment stablecoin issuer maintains on each business day: (i) at least 10 percent of its required reserve assets as deposits or insured shares payable upon demand or money standing to the credit of an account with a Federal Reserve Bank; (ii) at least 30 percent of its reserve assets as deposits or insured shares payable upon demand, money standing to the credit of an account with a Federal Reserve Bank, or amounts receivable and due unconditionally within five business days on pending sales of reserve assets, maturing reserve assets, or other maturing transactions (e.g., reverse repurchase agreements); (iii) no more than 40 percent of its reserve assets at any one eligible financial institution, whether as deposits or insured shares at any one insured depository institution, securities custodied at any one eligible financial institution, bilateral reverse repurchase agreements with any counterparty, or through other exposures; (iv) no more than 50 percent of the amount provided in proposed § 15.11(c)(2)(i) at any one eligible financial institution; and (v) reserve assets with a weighted average maturity of no more than 20 days. 87 Eligible financial institutions that hold reserve assets in custody or safekeeping must be subject to supervision and comply with the requirements set forth in section 10 of the GENIUS Act (12 U.S.C. 5909). Institutions subject to OCC supervision would need to comply with the requirements set forth in proposed subpart C of part 15.

The safe harbor would also have required that a permitted payment stablecoin issuer maintain at least 30 percent of its reserve assets as deposits or insured shares payable upon demand, money standing to the credit of an account with a Federal Reserve Bank, or amounts receivable and due unconditionally within five business days on pending sales of reserve assets, maturing reserve assets, or other maturing transactions. The safe harbor would have also required that a permitted payment stablecoin issuer maintain no more than 40 percent of its reserve assets at any one eligible financial institution, whether as deposits or insured shares at any one insured depository institution, securities custodied at any one eligible financial institution, bilateral reverse repurchase agreements with any counterparty, or through other exposures. The safe harbor would have also required that a permitted payment stablecoin issuer maintain no more than 50 percent of the required daily liquidity specified under proposed § 15.11(c)(2)(i) at any one eligible financial institution. This requirement was intended to guard against the risk that problems at one eligible financial institution prevent a permitted payment stablecoin issuer from accessing its reserve assets. If a permitted payment stablecoin issuer is dependent on one eligible financial institution to maintain all or a large portion of its reserve assets, the permitted payment stablecoin issuer may be excessively exposed to, for example, operational concerns at that eligible financial institution or even the risk of the institution’s failure. To qualify for the safe harbor, proposed § 15.11(c)(2)(v) would have required that a permitted payment stablecoin issuer’s reserve assets have a weighted average maturity of no more than 20 days.

Option B would have imposed the quantitative standards as mandatory requirements, rather than an optional safe harbor.
ii. Description of Comments and the Final Rule
Generally, more commenters expressed support for the “Option A” approach to reserve asset diversification over “Option B.” Several commenters supporting Option A stated that it appropriately balances rigor, flexibility, and clarity for permitted payment stablecoin issuers and enables appropriate tailoring. Some other commenters stated that Option A provides for appropriate tailoring to different business models and risk profiles. A few commenters stated that Option A would be consistent with established custody fundamentals or existing state-level frameworks. A few commenters favored Option A because it offers predictability for new entrants and flexibility for mature issuers to demonstrate diversification through risk management practices tailored to actual operations. One commenter stated that Option B would depart from Congressional intent because the proposed reserve requirements would be excessive and not properly tailored. A few commenters supported Option A but suggested changes. One commenter stated that weighted average maturity provisions should be changed so as not to discourage holding longer-dated Treasuries (subject to the statutory 93-day cap). One commenter suggested the OCC make clear that Option A may require a buffer of extra reserve assets. One commenter suggested that small permitted payment stablecoin issuers should be presumed to comply with Option A. Some commenters specifically addressed the proposed safe harbor provision. A few of these commenters stated generally that the safe harbor would provide flexibility for issuers. Several commenters stated that the safe harbor is improperly calibrated and suggested changes to

the quantitative limits that they argued would reduce risk or better support liquidity needs. A few other commenters argued that quantitative thresholds were unnecessary, impractical, or inadequately supported by data. One of these commenters suggested that, if retained, issuers should be able to satisfy the safe harbor by meeting board-approved diversification requirements. Several commenters stated that the safe harbor should not be treated as a minimum requirement or baseline expectation. One commenter suggested that compliance with the safe harbor should be measured as of the close of each business day, with opportunity for a cure period of one business day. Several commenters favored “Option B” instead. Some of these commenters stated that quantitative thresholds would create more certainty and consistency for both issuers and third parties compared to a principles-based approach without specific quantitative thresholds. A few of these commenters also recommended changes to the specific requirements under Option B. One commenter stated that mandatory limits including single-custodian caps could reduce risk but suggested the OCC should clarify that reserve composition requirements do not eliminate liquidity risk in the event of a third-party custodian’s insolvency. One commenter supported Option B but suggested the OCC evaluate the impact of concentration limits and 20-day weighted average maturity to ensure they do not lead to unintended consequences. One commenter stated that neither Option A nor Option B fully addresses concerns related to deposit flight, impacts to credit creation, and potential systemic risk in light of increasing connections between stablecoin issuers and the banking system, citing the example of Silicon Valley Bank. A few commenters supported the establishment of minimum requirements for immediately available liquidity. One commenter noted that these requirements were preferable to

issuers relying on sales or repurchase agreements to generate liquidity. A few commenters supported having a weekly minimum liquidity requirement. One commenter supported the 10 percent and 30 percent thresholds for daily and weekly liquidity requirements, respectively. One commenter recommended that the 10 percent daily liquidity requirement should be adjustable based on each issuer’s demonstrated redemption profile, with 5 percent being an appropriate baseline for experienced issuers. The commenter further recommended that an issuer should be permitted to propose a threshold below the 5 percent minimum if the issuer can provide support for lower daily liquidity needs. One commenter suggested that the daily requirement should be calibrated to reflect actual historical redemption patterns instead of worst-case scenarios. One commenter stated that the OCC may need to revisit the 30 percent threshold for weekly liquidity at a later date to determine whether that threshold is still appropriate. A few commenters recommended raising the daily minimum liquid asset requirement, to at least 20 percent or 25 percent. One commenter recommended raising the weekly minimum liquidity requirement to 50 percent. A commenter recommended that the timeframe used for the weekly liquidity framework should be calibrated to redemption expectations across the agencies. One commenter stated that the proposal would require issuers to honor redemption requests within two business days from the date of the redemption request. Accordingly, the commenter stated that liquidity and operational constraints would not prevent almost all permissible reserve assets from being monetized within the redemption window. Another commenter recommended that the rule clarify how issuers should comply with the daily and weekly liquidity requirements without maintaining a significantly high cash balance that does not promote the rule’s liquidity objectives.

One commenter opposed the weekly liquidity requirement, stating that the requirement would not have a meaningful effect. This commenter stated that any reserve asset can be monetized within five business days. Several commenters opposed the daily liquidity requirement. Some commenters stated that the daily liquidity requirement would create unnecessary credit risk. One commenter stated that the minimum daily requirement is unnecessary because the scope of eligible reserve assets is highly liquid, as demonstrated by the requirements of SEC Rule 2a-7 (under which Treasury securities may count towards daily and weekly liquidity requirements). One commenter asserted that the 10 percent daily liquidity requirement lacks empirical or theoretical support and is inconsistent with international prudential standards, like the Basel III liquidity standards. A few commenters recommended that the final rule adopt a principles-based approach in which issuers would be required to demonstrate the capability to monetize at least 10 percent and 30 percent of their reserves on an overnight and weekly basis, respectively. One of these commenters asserted that an issuer should be permitted to demonstrate its monetization capability through any combination of eligible reserve assets. Other commenters stated that a principles-based approach would permit issuers to hold reserves like tokenized money market funds, which have less credit risk than bank deposits and settle no later than the next day. Several commenters commented on which assets should be eligible to count towards the daily and weekly liquidity requirements. One commenter recommended that eligible government money market funds offering same-day redemption should count towards the daily liquidity reserves requirement. A few commenters recommended that assets eligible to count towards the daily liquidity requirement should include reverse repurchase agreements, conducted on either an open or overnight basis. One commenter recommended that same- and next-day high-quality

instruments should be considered eligible reserve assets for purposes of the daily liquidity requirement. Another commenter suggested that all GENIUS Act-compliant reserve assets should count towards the daily liquidity requirement. One commenter recommended that reserves for the weekly liquidity requirement should include any eligible reserve asset convertible to cash within five business days, including GENIUS Act-eligible money market funds. Such a liquidity framework, the commenter reasoned, would be focused on functional liquidity and, in turn, better reflect how liquidity is generated in funding markets. One commenter recommended that government money market funds should count towards the weekly liquidity requirement, as redemption and settlement typically occur within one business day. A few commenters recommended that qualifying registered funds, like exchange-traded funds, should count towards the weekly liquidity requirement, considering their short settlement period and their daily price and portfolio transparency. One commenter stated that deposits are more vulnerable than custodied securities. One commenter noted that tokenized funds under SEC Rule 2a-7 are being developed primarily as collateral instruments rather than as cash payment instruments. One commenter suggested that any offset for expected inflows should be permitted only on a conservative basis. One commenter recommended that the OCC remove or replace the requirement in proposed § 15.11(c)(2)(ii) relating to Board review of the percentage of reserve assets required to be held that must be receivable within five days. One commenter argued that concentration limits should be limited to uninsured deposit holdings because further concentration restrictions would add little stability and could increase operational and run risk or reduce reserve yields. This commenter also stated that it is not

possible to apply concentration limits to United States Treasury repurchase agreements because there is only one remaining tri-party repurchase agreement clearing bank for United States Treasury repurchase agreements and it handles virtually all of the cleared tri-party repurchase agreement market. Several commenters specifically addressed the proposed 40 percent concentration limit under the proposed safe harbor. A few commenters stated that the 40 percent limit was well calibrated. One commenter suggested the limit should be raised to 60 percent to reflect the limited number of custodians currently willing to serve stablecoin issuers. Another commenter suggested reducing the limit to 15 percent and explicitly prohibiting the use of affiliated bank deposits as qualified reserves unless ring-fenced under separate capitalization and governance structures. One commenter stated that the 40 percent threshold was too limiting and that permitted payment stablecoin issuers should have flexibility to use one or more custodians. One commenter noted the limit could be breached due to changes in asset prices rather than redemptions or transfers. Another commenter stated that concentration restrictions should be based on gross exposures, aggregated across affiliates, custody, deposits, and bilateral transactions. This commenter further suggested that, if the OCC adopts deposit concentration caps, they should be tiered by bank credit quality, distinguish between insured and uninsured exposure, and also distinguish between deposit exposure and collateralized repo exposure. Some commenters categorically objected to the 40 percent threshold. One commenter explained that the concentration limit would still allow large exposures in the form of uninsured deposits, which highlights problems associated with a single numerical threshold without distinguishing between private credit risk and infrastructure or custodian concentration. A few commenters suggested that concentration caps should be tiered based on the issuer’s size, and one of these commenters

also recommended higher limits for assets collateralized by United States Treasuries or held at systemically important financial institutions. Several commenters argued that custodians or assets held in custody should be excluded from concentration limits. Some of these commenters stated that applying concentration and diversification limits to custodial arrangements would require permitted payment stablecoin issuers to manage a larger number of transactions across custodians, which increases the risk of operational and process errors without meaningfully reducing risks. One commenter stated that few institutions currently provide custodial services to issuers. A few commenters stated that custodians are highly regulated and pose little credit risk with respect to non-cash assets held off￾balance sheet that are segregated from the custodian’s proprietary assets. A few of these commenters stated that custodian-level concentration limits may introduce risks for permitted payment stablecoin issuers by fragmenting reserve assets across numerous custodians and banking relationships. One commenter stated that custodian diversification requirements would be novel, as SEC-registered money market funds and similar instruments are not subject to similar requirements, and could drive issuers away from the institutions best able to provide secure custody services. A few commenters suggested that concentration caps would be ineffective at preventing failures and could contribute to instability by spreading and potentially commingling reserve assets among the same set of large asset managers. One commenter suggested that self-custodied assets should be explicitly excluded from the 40 percent limit. Another commenter suggested excluding deposits held at an OCC-regulated affiliate if the affiliate holds an equivalent amount of cash at its Federal Reserve master account and remains well-capitalized. A few commenters stated that the 40 percent cap should not apply

to Federal Reserve Bank balances, and one of these commenters also suggested eliminating the cap for global systemically important banks (G-SIB). Several commenters raised other criticisms of concentration limits. One commenter suggested the OCC exclude ETFs from the 40 percent requirement, or at a minimum explain the benefit of imposing the limit on ETFs, since shares are generally held through a third-party custodian subject to a legal and regulatory framework that addresses asset segregation and protects the investor in the event of the custodian’s insolvency. This commenter also stated the 40 percent limit should not apply to self-custodied money market funds or on a look-through basis to a government money market fund’s custodian or other service providers. One commenter stated that the 40 percent limit discourages the use of local banks for remote communities and proposed a higher limit for reserves held at insured depository institutions that are located in more remote areas and meet certain other criteria. One commenter stated that the 40 percent limit should apply specifically to uninsured deposits. One commenter suggested the OCC clarify the scope of “other exposures” and in particular should address whether and how intraday credit facilities, uncommitted liquidity lines, and custodial sub-arrangements extended by or through an eligible financial institution would count toward the cap. A few commenters criticized the proposed look-through requirement. One of these commenters stated that the approach would increase compliance costs and likely impose substantial monitoring and reporting burdens, which could also reduce operational efficiency and increase the risk of settlement delays or frictions. Another commenter stated that the requirement could create significant operational challenges since reserve assets may be held through omnibus accounts, sub-custody chains, or collateral-agent structures that do not map cleanly onto a single￾institution concentration calculation. One commenter recommended removing the phrase

“through other exposures” so that issuers would not need to “look through” sub-custodians to satisfy diversification requirements, as issuers would need to obtain and continuously monitor information about their custodians’ internal sub-custodial arrangements and may be at risk of non-compliance due to subsequent events beyond their control. One commenter suggested the look-through requirement is unnecessary with respect to Treasury securities, repurchase agreements, and securities issued by a GENIUS Act-eligible investment fund, since these types of reserve assets ultimately reside with highly regulated central counterparties or central securities depositories. A few commenters recommended that the OCC remove the requirement limiting the amount of daily liquidity an issuer may hold at one financial institution. They reasoned that the requirement is impractical and the risks associated with cash reserves held at regulated institutions are already effectively addressed within the existing prudential framework. A few commenters noted that ordinary transaction flows could cause an issuer to routinely breach a 50 percent limit on daily liquidity at a single institution, especially when an issuer places liquidity reserves in only two financial institutions. Commenters recommended the OCC address this issue by raising the limit to 60 percent or building flexibility into the limit on liquidity reserves held at a single institution. A few commenters objected to the limits on deposit concentration, in whole or in part. One commenter suggested that there should be no limit on deposits at a single institution, and if such a deposit limit is established, the limit should be in the 20 to 25 percent range. Another commenter recommended that limits on deposits should not apply to insured deposits, and that, for uninsured deposits, the OCC should adopt a tiered limit for uninsured deposits that reflects historical loss rates. A few commenters advocated for the establishment of a lower deposit

concentration limit, including more granular limitations. One commenter suggested that an issuer should be permitted to deposit no more than 5 percent of eligible reserve assets at depository institutions and have no more than 2 percent exposure to a single institution, with additional deposit balances permissible for purposes of operational liquidity. Several commenters requested or suggested clarifications in the final rule regarding how to calculate the weighted average maturity. A few commenters requested confirmation that the weighted average maturity calculation would be performed on a portfolio basis, allowing issuers to hold a mix of maturities so long as the overall weighted average does not exceed the 20-day limit. Another commenter suggested the 20-day requirement be paired with amortized cost valuation. A commenter recommended that issuers whose stablecoins are predominantly used as settlement infrastructure for duration-bearing tokenized instruments be permitted to maintain a higher weighted average maturity, subject to supervisory approval. One commenter recommended that the weighted average maturity be extended in response to concentration in Treasury markets. Another commenter suggested the OCC have a two-year pilot program and modify the weighted average maturity requirements based on data collected during that timeframe. A few commenters opposed the use of SEC Rule 2a-7’s methodology to calculate the weighted average maturity. One of these commenters explained that the key consideration for measuring liquidity is how quickly an issuer can convert a non-cash asset to cash. The commenter stated that use of the methodology in SEC Rule 2a-7 would effectively assign a 20- or 40-day maturity to funds with shares that can be redeemed at par in much less time. Because of the speed with which reserves can be redeemed, the commenter recommended the OCC assign a weighted average maturity of zero for money market funds.

Another commenter stated that payment stablecoins represent redemption-backed liabilities, whereas money market funds are investment products that seek to maintain stability of net asset value. Accordingly, the commenter stated that the calculation methodology under SEC Rule 2a-7, which includes “maturity-shortening provisions” for securities subject to a demand feature or interest rate reset, is not the appropriate measurement for stablecoin reserves. The commenter suggested that the final rule calculate maturity as the period remaining until the date on which, in accordance with the terms of the security, the principal amount must unconditionally be paid, or in the case of a security called for redemption, the date on which the redemption payment must be made. A few commenters supported the 20-day weighted average maturity requirement. Several other commenters opposed the 20-day weighted average maturity on various grounds. Several of these commenters were concerned that the weighted average maturity requirement would limit issuers’ ownership of reserve assets with longer maturities, including Treasuries, which would otherwise be permissible under the GENIUS Act. Commenters also asserted that the 20-day weighted average maturity requirement would constrain efficient reserve management, increase operational risk by requiring investment in short-term assets that mature or roll over rapidly, and would impose compliance burdens on issuers, who would need to ensure that reserve assets do not breach the 20-day weighted average maturity requirement. A few commenters stated that the proposed 20-day weighted average maturity requirement would provide little, if any, benefit to an issuer’s liquidity and redemption capabilities. Several commenters recommended that the OCC increase the length of the weighted average maturity. A few commenters recommended increasing the length to 40 days, to allow smaller issuers more flexibility and to allow more issuers to use three-month Treasuries. A few

commenters recommended increasing the length to 60 days to align with money market funds and SEC Rule 2a-7, and to afford issuers greater flexibility to use Treasuries. A few commenters recommended increasing the length to 93 days, to align with permitted Treasury holdings. Several commenters proffered their views on how the reserve requirements of the proposed rule might affect community banks. One commenter, for example, noted that payment stablecoin reserves may not be as stable as demand deposits and thus may subject community banks to a greater run risk, while another noted that community banks for that reason may not be willing to provide services to permitted payment stablecoin issuers. Another commenter argued that reserve diffusion requirements could increase the financial stability risk of a run on one permitted payment stablecoin issuer throughout a large number of community banks. However, other commenters worried that payment stablecoins will shift stable funding sources away from community banks, reducing their competitiveness, and believed that reserve asset diversification should be premised in part on the funding needs of community banks. A few commenters argued that diversification should be risk-based and should not increase the risks to permitted payment stablecoin issuers or payment stablecoin holders to achieve other aims. The final rule neither mandates that permitted payment stablecoin issuers use community banks nor requires community banks to take on permitted payment stablecoin issuers as customers. The OCC believes that this approach appropriately allows community banks to exercise their business judgment with respect to payment stablecoin activities. The OCC acknowledges that deposits that serve as reserves backing a payment stablecoin could, at this time, be less stable sources of funding than other types of deposits. It is possible that these deposits may become more stable over time (i.e., as the GENIUS Act framework continues to be implemented). At this point, in light of the comments received, the OCC believes that

diversification requirements that neither mandate nor discourage placement at community banks are appropriate. The final rule makes a number of changes to § 15.11(c) in response to the comments received. Specifically, the OCC is adopting a hybrid approach using the principles-based approach from Option A and a modified and limited set of the quantitative requirements from Option B. The proposed rule included robust liquidity requirements but did not include stress testing or buffer requirements. The proposal noted that an alternative possibility would be to remove some of the proposed liquidity requirements, though this may warrant increased capital or buffer requirements. The final rule substantially lessens the quantitative liquidity, diversification, and concentration requirements that apply to permitted payment stablecoin issuers and instead imposes stress testing and buffer requirements in §§ 15.11 and 15.13. The OCC recognizes that, as a permitted payment stablecoin issuer sells more liquid assets to meet redemption requests in times of stress, it may temporarily fail to satisfy all of the terms in § 15.11(c) of the final rule. For example, a permitted payment stablecoin issuer might draw first on its deposits to timely redeem payment stablecoins, and, as a result, may temporarily fall below the 5 percent minimum while it reconfigures its reserve asset portfolio. Depending on the facts and circumstances, negative supervisory consequences for a failure to maintain that 5 percent minimum may be inappropriate, and the OCC will consider any supervisory actions for such a temporary violation in light of the totality of the circumstances causing the violation. A permitted payment stablecoin issuer should nevertheless appropriately diversify its reserve assets as soon as practicable following such an event. However, at no point can a permitted payment stablecoin issuer’s reserve asset value be less than the outstanding issuance value of the

Consistent with the proposed rule, § 15.11(c)(1) provides that a permitted payment stablecoin issuer must maintain reserve assets that are sufficiently diverse to manage potential credit, liquidity, interest rate, and price risks. The final rule clarifies in § 15.11(c)(1)(iii) that, depending on relevant factors, including a permitted payment stablecoin issuer’s risk profile, business model, and portfolio of reserve assets, a permitted payment stablecoin issuer may need to maintain an amount of reserve assets that exceeds the requirements of § 15.11(c)(2) and the reserve asset value of which exceeds outstanding issuance value. A permitted payment stablecoin issuer must measure and manage the risk that concentrating reserve assets at one eligible financial institution or a small number of eligible financial institutions may impair the ability of a permitted payment stablecoin issuer to satisfy redemption demands if individual eligible financial institutions are unable to return, or if there is a delay in returning, reserve assets placed by a permitted payment stablecoin issuer. The final rule clarifies that, depending on relevant factors, including a permitted payment stablecoin issuer’s risk profile, business model, and stock of reserve assets, a permitted payment stablecoin issuer may need to maintain reserve assets in excess of the daily liquidity amounts required under paragraph (c)(2) (discussed below). The OCC believes that this baseline principles-based approach, supplemented with the quantitative requirements described below, provides permitted payment stablecoin issuers sufficient flexibility while also providing a backstop against key risks that could result from undue concentration in assets that may be difficult to monetize within a day or exposures to a single counterparty. Permitted payment stablecoin issuers with less complex business models and lower risk profiles may be able to maintain a less diverse stock of reserve assets than permitted payment stablecoin issuers with more complex business models or higher risk profiles. However, section 4(a)(4)(A)(iii) of the

GENIUS Act (12 U.S.C. 5903(a)(4)(A)(iii)) mandates some reserve asset diversification for all permitted payment stablecoin issuers, both in types of reserve assets maintained and in the number of eligible financial institutions holding a permitted payment stablecoin issuer’s reserve assets. The OCC expects that all permitted payment stablecoin issuers will need to maintain multiple reserve asset types, if only to serve as a backup to what is otherwise a permitted payment stablecoin issuer’s primary reserve asset. Some permitted payment stablecoin issuers may need to maintain more robustly diverse stocks of reserve assets to satisfy § 15.11(c), depending on their business model, risk profile, and other relevant factors. For example, a large permitted payment stablecoin issuer with complex operations may need to maintain deposits with multiple eligible financial institutions, as well as a stock of Treasury bills, potentially custodied with more than one eligible financial institution in order to ensure they are capable of being monetized during periods of financial stress. Factors such as the number of parties that redeem directly with the permitted payment stablecoin issuer, the volume of redemptions (and volatility with respect to such volume), and the number and nature of the blockchains on which a payment stablecoin is traded could all increase the complexity of the permitted payment stablecoin issuer’s operations and weigh in favor of maintaining multiple different pools of reserve assets.
Section 15.11(c)(2) of the final rule provides a modified version of the daily liquidity and
counterparty concentration requirement from the proposed rule. Section 15.11(c)(2)(i) requires a permitted payment stablecoin issuer to maintain at least 5 percent of its reserve assets as demand deposits (or other deposits that may be withdrawn upon request at any time), funds in share accounts that are payable on demand, or money standing to the credit of an account with a Federal Reserve Bank. 88 This minimum daily liquidity requirement is intended to ensure that a 88 The final rule refers to “funds in share accounts that are payable on demand,” rather than “insured shares,” to clarify that such funds must be available on demand to meet the 5 percent minimum requirement in § 15.11(c)(2).

payment stablecoin issuer has readily available funds necessary to meet redemption requests. While all of the proposed reserve assets should be liquid and easily monetizable, the requirement to have some minimum level of immediately liquid funds provides additional protection against the risk that a permitted payment stablecoin issuer would be unable to meet redemption requests in a timely manner, which is critical to maintain confidence in the permitted payment stablecoin issuer and the stablecoin industry as a whole. Including a baseline requirement to maintain a minimum percentage of liquidity that is immediately available (without the need to sell any assets, even highly liquid assets like Treasury securities) will help ensure a permitted payment stablecoin issuer’s ability to meet redemption requests. In light of other changes to §§ 15.11(a) and 15.13 (e.g., stress testing requirements), the final rule lowers this daily liquidity requirement from 10 percent to 5 percent of reserve assets. The requirements of §§ 15.11(a) and 15.13 are designed to ensure that permitted payment stablecoin issuers are able to timely redeem payment stablecoins, including in times of stress. Since these requirements will necessarily entail measures the permitted payment stablecoin issuer must take to maintain capacity to meet short￾term redemption requests, it is appropriate to lower the quantitative requirement for daily liquidity. For example, when a permitted payment stablecoin issuer has capabilities to monetize reserve assets quickly because a large portion of their reserve assets is in the form of Treasury securities, whether held directly or by a custodian, that may obviate the need to hold a higher amount of daily liquidity. The final rule does not include the requirement from proposed § 15.11(c)(4) requiring no more than 50 percent of daily liquidity to be held at any one eligible financial institution in light of the fact that the total requirement has been reduced to 5 percent (the total amount of required daily liquidity that could be held at a single eligible financial institution under the proposed rule).

The OCC notes that, under § 15.12, a permitted payment stablecoin issuer must notify the OCC when it receives redemption requests in excess of 10 percent of its outstanding issuance value over a single 24-hour period. As discussed elsewhere, permitted payment stablecoin issuers that hold only 5 percent of their reserve assets as demand deposits or money standing to the credit of a Federal Reserve Bank should take steps to ensure that they can timely redeem tendered payment stablecoins under stressed conditions.
Section 15.11(c)(2)(ii)(A) of the final rule requires a permitted payment stablecoin issuer
to limit its exposure to any one counterparty to no more than 40 percent of its reserve assets.
Section 15.11(c)(2)(ii)(B) lists various exposures that are not subject to this limitation. Under the
final rule, the following exposures are excluded: (1) exposures to the United States Government, (2) exposures to an appropriate custodian (as described in § 15.11(d)), resulting from reserve assets being held in the custody of the custodian, and (3) exposures resulting from centrally cleared repurchase agreements and centrally cleared reverse repurchase agreements. For clarity, reserve assets held directly by a permitted payment stablecoin issuer also are not subject to the 40 percent limit in § 15.11(c)(2)(ii)(A) because the permitted payment stablecoin issuer cannot be its own counterparty. The requirement in § 15.11(c)(2)(ii) is intended to prevent an issuer from being overly exposed to any one eligible financial institution or counterparty, including through a deposit relationship, bilateral repurchase agreement, bilateral reverse repurchase agreement, or investment company. While this requirement would not eliminate the chance of either temporarily or permanently losing reserve assets because of distress at an eligible financial institution holding reserve assets, it would ensure that permitted payment stablecoin issuers have other reserve assets available to satisfy redemption requests. The final rule modifies the counterparty limit by explicitly excluding exposures to the United States Government. As

discussed above, exposures to Federal Reserve Banks would remain subject to this limit. The final rule excludes exposures resulting from centrally cleared repurchase agreements and reverse repurchase agreements due to the low credit risk associated with such transactions. The final rule also does not apply the 40 percent limit to custodians that meet certain requirements (as discussed in greater detail below). The OCC agrees with commenters that imposing a limit on custodians that comply with the requirements of the GENIUS Act may introduce unnecessary operational risks without a corresponding benefit. At the same time, it is important that there are mechanisms in the final rule to help ensure that custodians of reserve assets comply with the terms of the GENIUS Act if they are to be exempt from the 40 percent limit. Accordingly, as discussed in the next section, the final rule imposes certain additional requirements on permitted payment stablecoin issuers with respect to custodians designed to ensure that the custodians comply with the requirements of the GENIUS Act. Paragraph (c) of the final rule’s § 15.11 does not include a weighted average maturity requirement. The OCC believes that changes to §§ 15.11(a) and 15.13 will be sufficient to ensure that the reserve asset portfolio of a permitted payment stablecoin issuer is sufficiently liquid without imposing a separate weighted average maturity requirement. e. Custody of Reserve Assets (§ 15.11(d)) Self-Custody and Use of Affiliates Several commenters suggested that the OCC place significant limits on, or prohibit, an issuer holding its reserve assets itself (self-custody). These commenters argued that self-custody and captive affiliate structures can undermine the independence of the custody function and create conflicts of interest inconsistent with safety and soundness. Some commenters stated that the proposed rule does not provide sufficient clarity on how self-custody would work in practice,

including: (i) whether a permitted payment stablecoin issuer holding reserves directly would qualify as the covered customer or an eligible financial institution, (ii) how reserve assets would be segregated from proprietary assets, and (iii) whether the custody function would need to be separated from issuance and reserve management activities. A few commenters noted that, if self-custody is permitted, permitted payment stablecoin issuers should be required to maintain clear segregation, bankruptcy-remote protections, and operational separation. Some commenters argued that additional capital requirements should apply because the permitted payment stablecoin issuer would be assuming risks otherwise borne by an external custodian. Other commenters opposed intragroup reserve arrangements and urged the OCC to apply concentration limits across affiliated entities on a consolidated basis rather than institution by institution. In contrast, a couple of commenters stated that the OCC should not mandate fixed minimum allocations of reserve assets between affiliated and unaffiliated custodians and instead should focus on operational resilience, concentration risk, and effective segregation while allowing issuers flexibility in structuring custody arrangements. Many commenters addressed how reserve assets should be managed when a permitted payment stablecoin issuer is affiliated with, or is a subsidiary of, an insured depository institution. Some commenters stated that affiliated custody arrangements should be subject to consistent risk management standards and that reserve assets, liquidity-management functions, and control frameworks should be clearly maintained at the subsidiary level, with dedicated personnel, independent governance, and clear entity-level accountability to reduce the risk of internal commingling, competing liquidity demands, or unclear authority during stress. In contrast, one commenter stated that the OCC should not impose permitted payment stablecoin issuer-specific governance or staffing mandates on bank-subsidiary issuers and should allow

them to use centralized group treasury and risk functions so long as applicable statutory standards are met. Another commenter opposed any exception from concentration caps that would allow an insured depository institution subsidiary to place all reserves at its parent or an affiliate. These commenters argued that statutory flexibility for omnibus commingling increases, rather than reduces, the need to avoid single-bank dependency and ensure strong segregation, control, and auditability. Several commenters stated that the OCC should add additional requirements in instances in which a permitted payment stablecoin issuer custodies reserve assets or deposits cash reserve assets at an affiliate. These commenters stated that affiliate custody of reserve assets may give rise to significant risks as there is no independent custodian to provide an added layer of protection to holders of the relevant payment stablecoin. Commenters suggested, for example, either limiting the amount of reserves that may be custodied or deposited at an affiliate, imposing enhanced capital buffers, or including affiliate concentration risk as a factor that the permitted payment stablecoin issuer’s independent accountant must consider. The final rule, consistent with the proposal and the text of the GENIUS Act, does not prohibit self-custody of reserve assets or the use of an affiliate to hold reserve assets in custody. As discussed below, direct reserve asset holdings will not be subject to a counterparty limit but non-custodial exposures to affiliates will be. The OCC notes that, in the case of subsidiaries of national banks or Federal savings associations, the OCC will have clear visibility into the business of the parent and the subsidiary, through the supervisory process. The OCC agrees with commenters that reserve assets should be operationally separate from the other assets of a permitted payment stablecoin issuer. The OCC notes that § 15.11(a)(1)(ii) requires a permitted payment stablecoin issuer to maintain reserve assets that are identifiable and that are segregated

and not commingled with other assets owned or held by the permitted payment stablecoin issuer. In addition, as discussed elsewhere, the final rule has been designed to permit the use of separate issuer SPVs, such that the reserve assets of each issuer would be segregated from one another. Finally, with respect to affiliate transactions, the OCC notes that insider and affiliate transactions must comply with the requirements of § 15.13 (described in greater detail below). Fiduciary Responsibilities Commenters expressed differing opinions on whether fiduciary treatment should be avoided to reduce regulatory uncertainty or required to strengthen segregation and insolvency protections. A few commenters suggested that the OCC clarify whether directed custody of reserve assets constitutes a fiduciary activity under 12 CFR part 9. Some commenters stated that directed, non-discretionary custody should not be treated as fiduciary by default unless the custodian independently performs a fiduciary function identified in part 9. In contrast, one commenter stated that reserve assets should be required to be held in a fiduciary capacity and that all institutions with custody of stablecoin reserves should hold those assets in a legally segregated manner for the exclusive benefit of stablecoin holders. That commenter also noted that fiduciary custody at a national trust bank provides stronger insolvency protections because the assets are not part of the custodian’s estate, unlike ordinary deposits at a depository bank, which become general liabilities of the bank. The OCC declines to make a blanket statement that directed custody of reserve assets is a fiduciary activity. Whether a custodian is subject to 12 CFR part 9 or 12 CFR part 150 will depend, among other factors, on the charter type of the custodian and applicable law, including the agreement that the custodian has with its customer. Some commenters stated that responsibility for determining whether assets qualify as permissible reserve assets, whether reserves are sufficient on a portfolio-wide basis, and how

reserves should be classified or reported should remain with the issuer rather than the custodian. Other commenters noted that custodians often lack visibility into an issuer’s full reserve portfolio, particularly where multiple custodians or intermediaries are used, and therefore should not be required to independently verify reserve composition, adequacy, sufficiency, or compliance with diversification and concentration requirements. As discussed in greater detail below, the OCC confirms that the permitted payment stablecoin issuer remains responsible for ensuring compliance with all requirements in the GENIUS Act and implementing regulations related to reserve assets and other requirements pertaining to its issuance of payment stablecoins. 89 Covered custodians under subpart C of the final rule are responsible for compliance with requirements contained within the GENIUS Act and subpart C related to appropriate custody of reserve assets and other covered assets. Obligations of Third-Party Custodians to Ensure Compliance Commenters addressed oversight of custodians, service providers, and counterparties, with some stating that permitted payment stablecoin issuers should conduct thorough initial due diligence and ongoing monitoring of custodians’ legal status, financial condition, operational resilience, cybersecurity, and compliance programs, consistent with third-party risk management principles. In contrast, one commenter suggested that permitted payment stablecoin issuers should not be required to monitor the financial condition of all depository institutions holding reserve assets because those institutions are already subject to robust prudential regulation. Another commenter stated that a permitted payment stablecoin issuer should continuously monitor the condition of its counterparties and treat concentration risk as risk-sensitive. 89 As noted above, a permitted payment stablecoin issuer may use an investment adviser or asset manager to manage reserve assets under § 15.10 of the final rule, but the permitted payment stablecoin issuer remains responsible for ensuring compliance with the GENIUS Act and its implementing regulations.

One commenter suggested that the OCC clarify that third-party custodians are not responsible for ensuring that a permitted payment stablecoin issuer or foreign payment stablecoin issuer directs reserve assets to the correct account, such as a reserve account rather than a proprietary account. The commenter stated that, consistent with the futures commission merchant framework, the issuer should bear responsibility for segregation and avoiding commingling, while the custodian’s role should be limited to recognizing and maintaining the designated account as separate. This commenter also noted that custodians should not be required to verify the sufficiency of reserve assets held by a permitted payment stablecoin issuer at the custodian or be subject to additional requirements with respect to transaction services they provide. One commenter requested that the OCC expressly confirm that prior OCC guidance, including Interpretive Letter 1172, to the extent it required custodians to monitor 1 to 1 reserve sufficiency, has been superseded by the GENIUS Act framework. Another commenter requested additional clarity regarding reserve assets held through custodians or intermediaries, including governance, control, and access rights. As discussed in greater detail below, the final rule has been modified to provide additional clarity and notice to custodians. With respect to Interpretive Letter 1172, the OCC notes that the letter addressed deposit-taking activity and not custody. Nevertheless, the OCC confirms that a national bank or Federal savings association that holds deposits that serve as reserves or that holds other reserve assets in custody is not under an obligation to ensure that the reserve assets equal or exceed the outstanding issuance value of the payment stablecoin unless otherwise required by contract. Under § 15.11(d) of the final rule, reserve assets in the custody of one or more eligible financial institutions will not be subject to the 40 percent limit in § 15.11(c)(2)(ii) provided that

the permitted payment stablecoin issuer: (1) identifies itself to the custodian as a permitted payment stablecoin issuer; (2) ensures that the custodian commits to adhering to the requirements of section 10 of the GENIUS Act (12 U.S.C. 5909), including applicable implementing regulations; and (3) engages in appropriate due diligence and ongoing monitoring of its custodial arrangements to ensure compliance with applicable requirements of the GENIUS Act (12 U.S.C. 5901 et seq.), including applicable implementing regulations. These changes are intended to benefit custodians by providing them notice of when their obligations under section 10 of the GENIUS Act (12 U.S.C. 5909) attach. In addition, the requirements make clear that the permitted payment stablecoin issuer has an ongoing responsibility to conduct appropriate monitoring of the custodians that it employs. The OCC believes that this ongoing monitoring requirement will be both more effective and less burdensome than imposing a hard limit on the amount of exposure that a permitted payment stablecoin issuer can have to a single custodian. The final rule’s approach requires a permitted payment stablecoin issuer to take appropriate steps to ensure that its custodians comply with the GENIUS Act. This puts an emphasis on understanding and analyzing the activities of custodians, whereas the proposal could have allowed a permitted payment stablecoin issuer to meet its obligations merely by diversifying among different custodians without engaging with the substance of the custodians’ activities. 90 f. Minimum Insured Deposit Requirement for Large Issuers Proposed § 15.11(d) would have required a permitted payment stablecoin issuer with an outstanding issuance value of $25 billion or more to, on each business day, maintain at least 90 In response to certain comments, the OCC also confirms that, while a custodian may provide reserve asset valuation services, the permitted payment stablecoin issuer is responsible for ensuring that its reserve asset value equals or exceeds its outstanding issuance value at all times.

0.5 percent of its reserve assets in the form of insured deposits or insured shares at an insured
depository institution, up to a cap of $500 million.
Several commenters opposed the proposed insured-deposit minimum. These commenters explained that the insured-deposit minimum would add significant operational complexity and liquidity risk without providing a commensurate prudential benefit, especially for large operational deposit balances that do not meaningfully benefit from deposit insurance. Regarding liquidity risk, a commenter asserted that many deposit insurance schemes have tighter settlement cutoff times than traditional demand deposit accounts, which would increase operational risk if reserves would not be immediately available. Furthermore, the FDIC’s proposed restrictions on insured reserve balances would further complicate operationalizing the insured-deposit minimum requirement. A few commenters asserted that the OCC lacks the statutory authority to require issuers to place a percentage of reserve assets in numerous banks through the minimum insured deposit requirement. One commenter noted that the FDIC does not insure deposits above the $250,000 corporate limit, a limit that could render the minimum insured deposit requirement operationally infeasible. A commenter stated that the minimum insured deposit requirement would confuse stablecoin holders regarding what percentage of reserve assets are insured. Another commenter asserted that the requirement would unduly restrict an issuer’s ability to manage counterparty and credit risk. One commenter noted that it is expensive to open numerous deposit accounts, and the costs necessary to comply with the minimum insured deposit requirement could impede the adoption of stablecoins. One commenter requested clarification on how the minimum insured deposit requirement interacts with FDIC deposit insurance limits and capacity constraints at insured depository institutions. A few commenters suggested that if the minimum insured deposit requirement is

finalized, it should not exceed the smaller of $100 million or 0.1 percent of reserve assets. A commenter recommended the OCC calibrate the minimum insured deposit requirement to recognize the distinction between reserves held at smaller banks and other institutions. A few commenters were in favor of establishing a minimum insured deposit requirement and asserted that the proposed $25 billion threshold for issuers to be subject to the minimum insured deposit requirement is too high to prevent runs, de-pegging, and contagion. One of these commenters recommended lowering the threshold from $25 billion to $10 billion and raising the requisite percentage of reserve assets comprising insured deposits or shares from 0.5 percent to 5 percent, with total insured deposits or shares not to exceed $500 million regardless of the size of the issuer. A commenter opined that it is too early to determine whether all reserve deposits should be required to be insured in the event deposit insurance rules change, and that the final rule should not address such a requirement. One commenter supported permitting issuers to use deposit placement services to comply with the GENIUS Act’s diversification requirements for stablecoin reserves, subject to appropriate due diligence, including independent audit reports and Federal Financial Institutions Examination Council examinations. A few commenters opposed the use of deposit placement services for compliance with the diversification requirements, as the addition of intermediaries would increase operational complexity and counterparty risk. After careful consideration of the comments, the OCC is not adopting a requirement to have a minimum insured deposit amount. The OCC agrees with commenters that this minimum requirement may introduce additional operational risk that does not merit the reduction in credit risk associated with having a minimum insured amount.

g. Composition report, monthly certification, and failure to maintain minimum reserve assets (§§ 15.11(e) through (g))
i. Description of the Proposed Rule
Proposed § 15.11(e) would have required a permitted payment stablecoin issuer to publish on its website by noon on the last day of each month the composition of the issuer’s reserves held pursuant to the GENIUS Act as of noon of the last day of the prior month, using a format substantially similar to the template provided in table 1 to proposed § 15.11(e). The report contained fields for the total number of outstanding payment stablecoins issued by the issuer and the amount (fair value) and composition of the reserves, including the average tenor and geographic location of custody of each category of reserve instruments. The information in the report, including the value of reserve assets, would have been reported as of the end of the previous month. Section 15.11(e) of the proposed rule would have implemented the requirement in section 4(a)(1)(C) of the GENIUS Act (12 U.S.C. 5903(a)(1)(C)). Proposed § 15.11(f) implemented the applicable requirements of section 4(a)(3) of the GENIUS Act (12 U.S.C. 5903(a)(3)). This provision requires permitted payment stablecoin issuers to, each month, have the information disclosed in the previous month-end report examined by a registered public accounting firm. Proposed § 15.11(f)(1) would have required the examination of the previous month-end report to occur by noon on the last day of each month and would have required the report to be published on the permitted payment stablecoin issuer’s website at the same time as the monthly report required under proposed § 15.11(e). Consistent with the Act, proposed § 15.11(f)(2) would have required the Chief Executive Officer and Chief Financial Officer (or the persons performing the equivalent functions) of the permitted payment stablecoin issuer to submit to the OCC a certification that the monthly report is accurate. Under

section 4(a)(3)(C) of the Act (12 U.S.C. 5903(a)(3)(C)), any person who submits this required
certification knowing that such certification is false shall be subject to the same criminal penalties as those set forth under 18 U.S.C. 1350(c). Proposed § 15.11(g) set forth the consequences and remedial measures that would have applied if a permitted payment stablecoin issuer did not comply with the requirements of proposed § 15.11. Proposed § 15.11(g)(1) would have required a permitted payment stablecoin issuer to notify the OCC through its appropriate supervisory office on any day in which its reserve asset amount has fallen below the required minimum in proposed § 15.11(a). Proposed § 15.11(g)(2) would have barred a permitted payment stablecoin issuer that falls below the required minimum from issuing new payment stablecoins until it had remediated the shortfall except as necessary to facilitate a transfer of payment stablecoins from one distributed ledger to another and provided that the net outstanding issuance value does not increase. Proposed § 15.11(g)(3) provided that, if a permitted payment stablecoin issuer fails to meet its reserve asset requirement for 15 consecutive business days, it must begin liquidation of reserve assets and redemption of outstanding payment stablecoins consistent with § 15.12 and may not charge customers a fee to redeem their payment stablecoins at any time during the liquidation. The OCC would have been able to extend the time period under proposed § 15.11(g)(3) in its sole discretion. Because of the importance of maintaining minimum reserve asset levels, the proposed rule included automatic consequences for any non-compliance intended to prevent any concerns from developing further. This provision was intended to prevent chronic non-compliance with minimum reserve asset requirements. Proposed § 15.11(g)(4) stated that if at any point the OCC determined that a permitted payment stablecoin issuer had not demonstrated that it meets the reserve asset requirements in proposed § 15.11(a), (b), (c), or (d), the OCC may require the

issuer to submit a plan describing how the permitted payment stablecoin issuer will attain compliance and the timeline for the plan. If the OCC determined, either before or after the submission of a plan, that a permitted payment stablecoin issuer faces a significant risk of being unable to attain compliance with the reserve requirements in proposed § 15.11(a), (b), (c), or (d) within a reasonable period, the OCC would have been able to order the issuer to initiate redemption of all outstanding payment stablecoins. Proposed § 15.11(g)(4) also stated that the OCC’s authority to require a compliance plan or order redemption did not limit the OCC’s authority to pursue other measures, including enforcement actions, if appropriate.
ii. Description of Comments and the Final Rule
Commenters generally supported proposed § 15.11(e) through (g), although some had a few suggested changes. With respect to § 15.11(e) and (f), several commenters suggested that the once-a-month reporting standard be dropped in favor of enhanced reporting, 91 such as through implementing random floating day attestations or surprise examinations. The OCC is not requiring an additional random floating day attestation at this time. The OCC has broad supervisory authority and may examine permitted payment stablecoin issuers, as appropriate, including on an immediate basis. In addition, the OCC will receive detailed information from permitted payment stablecoin issuers each week and will have the ability to flag any unusual activity using this information. In light of that, the OCC believes that imposing a random floating day attestation requirement across all issuers is unnecessary at this time. Permitted payment stablecoin issuers may, nevertheless, decide to engage in random-day reporting and certification as a best practice. 91 Some of these commenters also addressed the requirement that excess reserves only be withdrawn once a month. The changes to § 15.11(a)(4) in the final rule address these comments.

One commenter suggested that the monthly certification section be made public. Under the final rule, the report required under § 15.11(f)(1) must be made public and the certification required under § 15.11(f)(2) must be submitted to the OCC. Permitted payment stablecoin issuers or the OCC may choose to publish the certification. If a permitted payment stablecoin issuer failed to provide a certification, the OCC would take appropriate supervisory action. One commenter recommended using particular criteria for the monthly composition report. The OCC believes that the proposed criteria, supplemented by the reporting that the OCC will receive under § 15.14, is sufficient. One commenter recommended that the OCC consider the Stablecoin Presentation and Disclosure Criteria developed by the AICPA in its rulemaking, recognizing that these criteria are already in use today and will continue to serve as the basis for issuer reporting and CPA examinations. Another commenter suggested the final rule specify that § 15.11(f) examinations are to be performed in accordance with the AICPA’ Statements on Standards for Attestation Engagements, which could suggest particular assurance and independence standards for these examinations. The OCC recognizes that certain industry criteria have been adopted by accounting firms in evaluating disclosures by stablecoin issuers today, and the OCC recognizes the importance of suitable criteria for examination engagements that are relevant, objective, measurable, complete, and available for users of the report. However, the final rule does not mandate any particular criteria so long as the examination meets the statutory requirements under the GENIUS Act to preserve flexibility as industry standards continue to develop. The proposed rule requested comments on the treatment of white-label arrangements or other arrangements where a single issuer issues multiple payment stablecoins. Several commenters stated that nothing in the GENIUS Act prohibits such arrangements. Other

commenters noted that if such arrangements are allowed, the OCC should implement additional requirements. For example, several commenters requested clarification regarding whether proposed § 15.11(a)(1)(ii)’s requirement that reserve assets be segregated from other assets owned or held by the permitted payment stablecoin issuer applied as well to payment stablecoins issued on multiple blockchains (that is, whether the reserves backing issuances on each blockchain need to be segregated from each other or can be placed in an omnibus account). The OCC confirms that it is not necessary to separate reserve assets by blockchain for a payment stablecoin that is issued under a single brand. For example, a single brand of payment stablecoin could be available on both blockchain A and blockchain B. The payment stablecoin could be backed by a single pool of reserve assets. That pool of reserve assets would be subject to the identification and segregation requirements of § 15.11(a)(1)(ii) of the final rule. Some commenters argued against allowing issuers to commingle the reserves of each payment stablecoin or to utilize a combined report under proposed section 15.11(e), as that could increase the risk that holders of one stablecoin are affected by deficient reserves of a separately marketed payment stablecoin. One commenter suggested that risks related to multi-brand issuers are best addressed through disclosure requirements akin to the treatment of white-labeled deposit or prepaid banking products. The final rule adopts § 15.11(e) of the proposed rule with minor changes. Specifically, the OCC is adding new paragraph (e)(1) and renumbering paragraphs (e)(1) and (e)(2) to (e)(1)(i) and (e)(1)(ii), respectively. The OCC is also making certain clarifying edits throughout. The final rule also makes edits to Table 1 to paragraph (e). Table 1 to paragraph (e) provides a template for the monthly composition report. Table 1 has been updated to reflect the definition of reserve asset value. Footnote 1 to the table provides guidance as to how to report if

an issuer issues multiple classes of payment stablecoins. The final rule revises this footnote to make clear that permitted payment stablecoin issuers should separately list different classes or brands, if applicable. The OCC has generally used these terms interchangeably and is making this revision for clarity. The footnote also states that, if a class or brand is secured by distinct pools of reserve assets, the permitted payment stablecoin issuer should describe both the operational and legal mechanisms for separately securing each brand or class (the proposal did not address operational mechanisms). Finally, consistent with other changes to the final rule, the OCC has revised footnote 1 to provide additional clarity for entities that use multiple separate issuer SPVs to issue payment stablecoins. The final rule makes clear that, if different payment stablecoins are issued by distinct issuers, such as SPV issuers, there should be a separate composition report for each class or brand. The final rule adopts § 15.11(f) as proposed with certain clarifying edits. Regarding the consequences for failing to meet minimum reserve asset requirements in proposed § 15.11(g), commenters were largely supportive but offered various amendments or requested clarifications. Regarding the required notification in § 15.11(g)(1), one commenter requested that the OCC specify the exact format, submission mechanism, and timing window for the notification. The OCC is not revising the rule text in response to this comment. The final rule specifies that the permitted payment stablecoin issuer must provide notice through its supervisory office on any day in which the reserve asset amount falls below the required amount. The OCC believes that this is sufficient guidance and that adopting an overly formalistic submission mechanism may serve to delay prompt notification. Regarding the prohibitions that are triggered if a permitted payment stablecoin issuer fails to satisfy the 1 to 1 reserve asset requirement at any time, several commenters asked that the

OCC clarify that this does not apply to temporary and immaterial intraday shortfalls arising from normal settlement timing differences. These commenters are incorrect; the reserve asset requirement applies at all times and does not allow for shortfalls. It is important that payment stablecoin holders have confidence that their payment stablecoins are appropriately backed at all times, consistent with section 4(a)(1)(A) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)), which does not require that a permitted payment stablecoin issuer only maintain 1 to 1 backing on an end-of-day basis. The OCC has, however, made one change to § 15.11(g)(2)(i) in response to comments. The final rule provides that the OCC may permit a permitted payment stablecoin issuer that is under-reserved to issue new payment stablecoins. This additional language will provide additional flexibility to address situations where it may be appropriate to allow a permitted payment stablecoin issuer to continue issuing when under-reserved while ensuring that an under-reserved permitted payment stablecoin issuer remains subject to appropriate scrutiny. Regarding the 15-consecutive-business-day trigger period for reserve asset liquidation in proposed § 15.11(g)(3), commenters expressed views on both the length of the period and the consequences. First, one commenter stated that the 15-day threshold is too permissive and should be based on a failure for 12 days in any 15-day period. Another commenter believed the 15-day period was reasonable but stated that the OCC should retain discretion to accelerate the period for material shortfalls. Second, several commenters cautioned against automatic liquidation thresholds, arguing that this could be overly punitive and could be more likely to result in fire sales. Instead, these commenters suggested either that the issuers implement gradual remediation or wind-down plans or else that the OCC establish tailored remediation timelines based on the nature and severity of the shortfall. The OCC believes that the flexibility in paragraph (g)(4) eliminates the need for any revisions. If an issuer fails to be adequately reserved for a significant

period, the OCC could require a remediation plan or order the redemption of all outstanding payment stablecoins of a permitted payment stablecoin issuer even if the issuer did not trigger the automatic redemption provisions in § 15.11(g)(3). The OCC also disagrees with the commenters who cautioned against automatic liquidation thresholds. In the first instance, the OCC reiterates the importance of permitted payment stablecoin issuers meeting their required reserve levels at all times. Second, the OCC notes that the OCC has discretion to extend the 15 consecutive-business-day period. Thus, if circumstances warranted an extension, the OCC could provide one. In § 15.11(g), the agency is finalizing the rule as proposed with certain clarifying edits throughout, including using the phrase “minimum reserve asset amount required by paragraph (a) of this section” for consistency in § 15.11(g)(1), (g)(2), and (g)(3). Additionally, in § 15.11(g)(2)(i), the OCC is clarifying that a noncompliant permitted payment stablecoin issuer may issue new payment stablecoins if permitted by the OCC. The OCC is also making technical changes to § 15.11(g)(4) and splitting that paragraph into three paragraphs (g)(4)(i) through (g)(4)(iii). Other Comments Exceptions for Smaller Issuers that are Subsidiaries of OCC-Regulated Depository Institutions Commenters had a variety of views concerning potential exceptions from the requirements of § 15.11. A commenter opposed creating an exception for smaller issuers or issuers that are subsidiaries of insured depository institutions from the proposal’s concentration and diversification requirements. One commenter supported the use of narrow exceptions from the proposal’s concentration and diversification requirements, subject to enhanced disclosure

requirements. A few commenters recommended that the exception for a subsidiary of an insured depository institution should be limited to parent institutions that are well capitalized. One of these commenters also supported permitting subsidiaries of insured depository institutions to hold all reserve assets as deposits at the parent institution only if the parent institution holds an equivalent amount of cash in its Federal Reserve master account. The commenter also suggested permitting reserve assets to be held in a designated sub-account of the parent institution’s master account or in the master account of the subsidiary issuer. The OCC is not revising the rule in response to these comments. The OCC believes that applying the same general standards to permitted payment stablecoin issuers that are subsidiaries of insured depository institutions and those that are not will enhance the safety and soundness of permitted payment stablecoin issuers, help to ensure financial stability, and facilitate competitive equity among different types of issuers. The OCC notes, however, that several of the requirements in the final rule are principles-based and tailored based on the size and complexity of a permitted payment stablecoin issuer. Thus, certain smaller and less complex permitted payment stablecoin issuers may be able to achieve compliance with these provisions using a simpler approach than that which would be necessary for a large and complex permitted payment stablecoin issuer. Reserve Asset Management, Mechanics, and Operations The OCC requested comments on whether to include additional measures to address de￾pegging in the secondary market. Several commenters responded that the OCC should not consider secondary market transactions owing to the risk of market manipulation or a potential lack of depth or reliability. The final rule does not include additional text concerning secondary market transactions except in the context of final § 15.16 (where such transactions are a factor

the OCC may consider in determining whether unusual and exigent circumstances exist). While the OCC believes that secondary market transactions may provide important supervisory information (and the OCC intends to review such information for supervisory purposes), the requirements of the GENIUS Act do not impose requirements on permitted payment stablecoin issuers regarding reserve assets that directly bear on secondary market transactions.
3. Redemption (§ 15.12)
a. Overview of Changes from Proposed Rule to Final Rule for § 15.12 As described below, the OCC is adding new paragraph (a) (and renumbering subsequent paragraphs appropriately). This new paragraph addresses the timeline for redemption. The OCC is adopting paragraph (a) as proposed other than renumbering it to paragraph (b), changing a reference from “customer” to “payment stablecoin holder,” adding “in the policy” before the colon, and making other conforming edits to reflect the renumbering of paragraphs in final § 15.12. The OCC is adopting paragraph (b) as proposed other than renumbering it to paragraph (c) in the final rule and making clarifying edits. The reserved numbering for proposed § 15.12(b)(2) has been removed, which led to a renumbering and a minor clarifying edit in final § 15.12(c). The OCC is renumbering proposed paragraph (c) to paragraph (d) and eliminating the automatic redemption provision that was contained in proposed § 15.12(c)(1) and described in proposed § 15.12(c)(2) and (c)(3). Section 15.12(d)(1) of the final rule provides that a permitted payment stablecoin issuer must provide notice to the OCC through its supervisory office within 24 hours if it receives redemption requests in excess of 10 percent of the outstanding issuance

value of any brand of payment stablecoin issued by the permitted payment stablecoin issuer in a single 24-hour period. Under § 15.12(d)(2) of the final rule, a permitted payment stablecoin issuer that experiences redemption requests in excess of 10 percent of the outstanding issuance value of any brand of payment stablecoin issued by the permitted payment stablecoin issuer in a single 24-hour period may request that the OCC extend the timeframe for timely redemption. Under § 15.12(d)(3) of the final rule, the OCC may, in its discretion, grant or deny an extension request or impose discretionary limitations upon timely redemption in accordance with section 4(a)(1)(B)(i) of the GENIUS Act (12 U.S.C. 5903(a)(1)(B)(i)). The OCC is renumbering proposed paragraph (d) to paragraph (e), changing references from “customer” to “payment stablecoin holders,” and making other conforming edits to reflect the renumbering of paragraphs in final § 15.12. Where proposed § 15.12(d)(1)(iii) required disclosure of a link to the monthly composition report, final § 15.12(e)(1)(iii) requires disclosure of a webpage that includes a link to the same report. The OCC is also adding new § 15.12(e)(1)(v), which would require a permitted payment stablecoin issuer to disclose that payment stablecoins are not legal tender, issued by the United States, or guaranteed or approved by the United States. The OCC is also adding new § 15.12(e)(1)(vi) which requires a permitted payment stablecoin issuer to disclose that payment stablecoins are not deposits and are not backed by the full faith and credit of the United States, subject to deposit insurance by the FDIC, or subject to share insurance by the National Credit Union Administration. The OCC is removing the surplus phrase “that it provides” from § 15.12(e)(4). Finally, the OCC is adding new § 15.12(f) to clarify that the OCC will not require a permitted payment stablecoin issuer to redeem a payment stablecoin to the extent the permitted payment stablecoin issuer’s actions to redeem the payment stablecoin would cause the issuer to violate other applicable law.

b. Description of the Proposed Rule
Section 15.12 of the proposed rule addressed redemption requirements imposed by
section 4(a)(1)(B) of the GENIUS Act (12 U.S.C. 5903(a)(1)(B)). Consistent with the statute,
under proposed § 15.12(a), a permitted payment stablecoin issuer must publicly disclose its redemption policy. 92 The OCC proposed that, in disclosing its redemption policy, the issuer must include, at a minimum, certain information. Specifically, proposed § 15.12(a)(1) provided that the issuer must include a timeframe in which the issuer will redeem payment stablecoins and the timeframe under which the issuer is required to redeem payment stablecoins (which, under proposed § 15.12(b)(1)(i) may not exceed two business days following the date of the requested redemption). Proposed § 15.12(a)(2) would have required the issuer to include a statement consistent with proposed § 15.12(b)(1)(ii) that any discretionary limitations on timely redemptions can only be imposed by the OCC or, in the case of a State qualified payment stablecoin issuer, by the OCC, Federal Reserve, or the State payment stablecoin regulator, as applicable. Proposed § 15.12(a)(3) required that issuers include in their redemption disclosures a statement explaining the scenarios when the redemption period may be extended as provided for in proposed § 15.12(c). Proposed § 15.12(a)(4) provided that the issuer must provide a statement with clear instructions on how a payment stablecoin holder can redeem a payment stablecoin, including a link to the website(s) where a customer can redeem the payment stablecoin. Proposed § 15.12(a)(5) would have required the issuer to specify the minimum number of payment stablecoins, if any, that the permitted payment stablecoin issuer will redeem, provided that the 92 Under section 2(22) of the GENIUS Act (12 U.S.C. 5901(22)), the issuer of a payment stablecoin must be obligated to convert, redeem, or repurchase a payment stablecoin for a fixed amount of monetary value, not including a digital asset denominated in a fixed amount of monetary value.

issuer must redeem any number greater than or equal to one payment stablecoin, subject to appropriate customer screening and onboarding. Proposed § 15.12(b)(1) provided that an issuer’s redemption policy must provide clear and conspicuous procedures for timely redemption of outstanding payment stablecoins. In proposed § 15.12(b)(1)(i), the OCC proposed to define “timely” to mean that the permitted payment stablecoin issuer would have to redeem a payment stablecoin no later than two business days following the date of the requested redemption. The OCC proposed this two-business-day timeframe as an outer limit on when a permitted payment stablecoin issuer must redeem a payment stablecoin and understands that many issuers may choose a timeframe that is less than two business days. Proposed § 15.12(b)(1)(ii), consistent with the statute, provided that discretionary limitations on timely redemptions can only be imposed by the OCC or, in the case of a State qualified payment stablecoin issuer, by the OCC, the Federal Reserve, or the State payment stablecoin regulator, as applicable. Proposed § 15.12(c)(1) provided that the period for timely redemption is extended to seven calendar days if a permitted payment stablecoin issuer faces redemption demands in excess of 10 percent of its outstanding issuance value in a single 24-hour period. Under proposed § 15.12(c)(2), the extended redemption period would have applied to all redemption requests that are outstanding at the time the 10 percent threshold is met as well as any subsequent redemption requests following the time the threshold is met. Proposed § 15.12(c)(3) stated that the extension is non-discretionary and that a permitted payment stablecoin issuer may only redeem any of the outstanding or subsequent redemption requests prior to the seven-calendar-day period if the OCC determines that the issuer has the ability to redeem sooner in an orderly fashion and through a fair and transparent process or the OCC otherwise provides notice to the permitted payment

stablecoin issuer that the extended redemption period no longer applies. Under proposed § 15.12(c)(4), a permitted payment stablecoin issuer that exceeds that 10 percent threshold would have been required to provide notice to the OCC through its supervisory office within 24 hours. Proposed § 15.12(c)(5) provided that the OCC may, in its discretion, extend timely redemption described in proposed § 15.12(b)(1) or (c)(1), as applicable, if the OCC determines that the permitted payment stablecoin issuer poses a threat to safety and soundness, financial stability, or such an extension is otherwise in the public interest. Proposed § 15.12(d)(1) provided that a permitted payment stablecoin issuer must also publicly, clearly, and conspicuously disclose in plain language and in a format that is readily noticeable to customers, readily understandable by customers, and segregated from other information: (i) the name of the permitted payment stablecoin issuer that issues the payment stablecoin; (ii) that the permitted payment stablecoin issuer is the entity that is obligated to convert, redeem, or repurchase the payment stablecoin for a fixed amount of monetary value; (iii) the link to the monthly composition report of the relevant permitted payment stablecoin issuer’s reserves as required under proposed § 15.11(e); and (iv) all fees associated with purchasing or redeeming payment stablecoins. The OCC included a requirement that the disclosures under proposed § 15.12(d)(1) be readily noticeable by customers, readily understandable by customers, and segregated from other information to provide more certainty on what it means to “publicly, clearly, and conspicuously disclose [the information] in plain language.”93 The OCC proposed to include the requirement that the disclosures be segregated from other information to ensure that the information in the disclosures is not combined with other nonrelevant information that could obscure the importance of these disclosures. 93 12 U.S.C. 5903(a)(1)(B)(ii).

Proposed § 15.12(d)(2) provided that an issuer must update the disclosures in proposed § 15.12(d)(1)(iv) if there are any changes in the fees associated with purchasing or redeeming stablecoins and provide customers at least seven calendar days’ prior notice of the change, including by securely delivering the notice to current customers. Proposed § 15.12(d)(3) provided that a permitted payment stablecoin issuer must publish the disclosures in proposed § 15.12(d)(1) and any updates made in accordance with proposed § 15.12(d)(2) on the permitted payment stablecoin issuer’s website. Proposed § 15.12(d)(4) provided that a permitted payment stablecoin issuer must include the disclosures in proposed § 15.12(d)(1) and any updates made in accordance with proposed § 15.12(d)(2) in any customer agreements that it provides.
c. Description of Comments and Final Rule
Commenters generally supported the majority of the requirements in proposed § 15.12(a). Some commenters disagreed on whether permitted payment stablecoin issuers should be permitted to set minimum redemption amounts. One commenter argued that the OCC should not require redemption of amounts greater than or equal to one stablecoin because such a low threshold would create disproportionate know-your-customer and anti-money-laundering burdens. Another commenter argued that the OCC should not impose a minimum redemption amount because redemption at par is a core feature of payment stablecoins. Commenters were also divided on whether permitted payment stablecoin issuers should be required to offer direct redemption to all payment stablecoin holders. Some commenters supported direct redemption for any holder, with no minimums, subject to compliance checks or the creation of a formal customer relationship through an onboarding process. In contrast, several commenters argued that issuers should be able to choose whether to have a fully retail redemption model or operate through institutional counterparties or authorized participants. One commenter went further by

suggesting that redemptions should only be structured to take place with institutional counterparties and authorized participants, rather than through retail relationships. Similarly, another commenter indicated that permitted payment stablecoin issuers should not be required to screen and onboard any stablecoin holder who requests redemption. In setting the requirement that a permitted payment stablecoin issuer must redeem any number greater than or equal to one payment stablecoin, the OCC looked to the structure of the Act and the relevant definitions. Notably, section 2(22) of the GENIUS Act (12 U.S.C. 5901(22)), defines “payment stablecoin” as a digital asset that an issuer “is obligated to convert, redeem, or repurchase for a fixed amount of monetary value.” The statutory language indicates that, while an issuer could set a minimum redemption threshold at a fraction of a payment stablecoin, an issuer redeems any number greater than or equal to one payment stablecoin under the GENIUS Act. Otherwise, a payment stablecoin would not be redeemable for a fixed amount of monetary value. 94 More generally, the OCC has identified nothing in the other provisions or structure of the Act, including the requirement to convert, redeem, or repurchase a payment stablecoin in section 2(22) of the GENIUS Act (12 U.S.C. 5901(22)) that distinguishes between retail or wholesale payment stablecoin holders. 95 Accordingly, the OCC has determined that a permitted payment stablecoin issuer must have the legal obligation to convert, redeem, or repurchase a payment stablecoin from any holder, subject to applicable law (e.g., Federal laws, 94 As discussed in greater detail below, a permitted payment stablecoin issuer could set a fee schedule that provided discounts for bulk redemptions or for new customers. Such a fee schedule would need to be publicly, clearly, and conspicuously disclosed in accordance with the final rule. 95 A permitted payment stablecoin issuer must also meet its Bank Secrecy Act and economic sanctions obligations under the GENIUS Act.

including BSA and economic sanctions requirements, including requirements of the customer identification program rule, certain non-U.S. laws, and State laws that are not preempted). To determine that a permitted payment stablecoin issuer does not have to redeem from any holder could result in the elimination of the obligation merely through a permitted payment stablecoin issuer limiting its customer base. For example, if a permitted payment stablecoin issuer were permitted to limit itself to only one institutional customer (e.g., a digital asset service provider that served as a cryptocurrency exchange), and that customer ceased operations or its legal existence, the permitted payment stablecoin issuer would no longer have an obligation to convert, redeem, or repurchase from the remaining payment stablecoin holders. Such a result would not be consistent with the text of section 2(22) (12 U.S.C. 5901(22)). However, a permitted payment stablecoin issuer need not have a business that focuses on retail customers. Whether or not the permitted payment stablecoin issuer focuses on retail customers, it will have the legal obligation to be able to convert, redeem, or repurchase from such customers and should have appropriate procedures in place to onboard such customers, particularly in times of stress. In light of the foregoing, the OCC is finalizing § 15.12(a) as proposed with certain renumbering changes to reflect other changes in § 15.12, discussed in greater detail below. The provisions of proposed § 15.12(a) are codified in the final rule at § 15.12(b), and references to other sections of § 15.12 have been correspondingly updated. In addition, subsection (b) of the final rule includes “in the policy” before the colon and listed items, and paragraph (b)(4) of the final rule replaces a reference to a “customer” that was in proposed § 15.12(a)(4) with a reference to a “payment 96 As discussed in greater detail below, new § 15.12(f) expressly confirms that the OCC will not require a permitted payment stablecoin issuer to redeem a payment stablecoin to the extent the permitted payment stablecoin issuer’s actions to redeem the payment stablecoin would cause the issuer to violate other applicable law.

stablecoin holder.” The final rule also includes technical changes, including adding “the” in front of “Federal Reserve” in paragraph (b)(2) of the final rule. Several commenters supported retaining a two-business-day standard for onboarded holders, particularly for direct counterparties, while some recommended that the OCC encourage same-day or real-time capabilities or tie shorter issuer commitments in terms of service to compliance expectations. One commenter recommended a 24-hour standard. Other commenters urged a more flexible, risk-based standard that accounts for reserve structure, safety and soundness, cross-border and intermediary arrangements, compliance reviews, and real-world settlement constraints. Commenters stated that the OCC should provide a clear timeframe for when redemption begins and ends. Commenters urged the OCC to adopt a clear, technology￾neutral definition of redemption that focuses on completion of the issuer’s obligations. Commenters requested clarification on when redemption is complete for compliance purposes, including whether completion occurs on burn initiation, block confirmation, ledger finality, or fiat currency credit to the customer’s bank account. Several commenters suggested that redemption should be considered complete when the issuer either initiates payment, credits the holder’s account, or fully processes the outgoing transfer, or when the holder receives fiat currency funds in its account. One commenter recommended a final-settlement approach based on receipt of funds by the redeeming party. Another recommended measuring compliance from the issuer’s initiation of payment rather than final settlement. Commenters also requested clarification on what is timely in various instances, including cross-border redemptions, court-ordered redemptions, and intermediated relationships. Several commenters supported preserving the two-business-day standard but allowing flexibility for delays caused by factors outside the issuer’s control, such as payment-system disruptions,

correspondent bank failures, or broader financial stress. Several commenters stated that the redemption timeline should begin only after the issuer is able to satisfactorily onboard the holder consistent with applicable laws and regulations. One commenter requested clarification that custodians should not be required to commit to specific settlement or release timeframes, and that the two-business-day standard should operate as an issuer liquidity and reserve requirement rather than a direct custodian obligation. One commenter requested recognition of comparable home-jurisdiction redemption standards in section 18(b) comparability determinations. One commenter requested that the OCC specify the consequences for untimely redemption. The OCC agrees that it is important to provide a clear timeframe for when redemption begins and ends. Accordingly, the OCC is adding a new paragraph (a) (and renumbering subsequent paragraphs appropriately). This paragraph addresses the timeline for redemption and provides that, for purposes of § 15.12: (1) a permitted payment stablecoin issuer’s obligation to redeem begins once: (i) the permitted payment stablecoin issuer has received a redemption order from a customer; 97 and (ii) if the permitted payment stablecoin issuer has onboarding procedures reasonably designed to not unduly delay the onboarding of retail or other customers, including in times of stress, the customer has been successfully onboarded and all other legal conditions necessary to permit redemption that complies with this part have been met. As discussed in greater detail below, permitted payment stablecoin issuers should have in place the capability to onboard new customers in times of stress. While many issuers may only interact directly with a small number of digital asset service providers in normal times, in times of stress or in the event of a failure of a digital asset service provider, payment stablecoin holders may seek to redeem 97 The OCC notes that the revised definition of customer includes a person who requests that a permitted payment stablecoin issuer convert, redeem, or repurchase a payment stablecoin.

directly with the permitted payment stablecoin issuer. The issuer should therefore have processes in place to address a sudden increase in customers. Accordingly, paragraph (a)(1)(ii) is designed to ensure that a permitted payment stablecoin issuer cannot use deficiencies in its onboarding process as a pretext to artificially extend the timeline for redemption. Paragraph (a)(2) clarifies that redemption is deemed to occur when the permitted payment stablecoin issuer has fully processed and initiated the outgoing transfer of monetary value to the customer or the customer’s financial institution as directed by the customer, 98 or, if requested by the customer, credited monetary value to the customer’s account with the payment stablecoin issuer. This approach to the redemption timeline appropriately (1) focuses on aspects that are within the permitted payment stablecoin issuer’s control (i.e., the issuer sending monetary value rather than the customer receiving monetary value), (2) addresses potential complications that may arise in cross-border transactions or transactions with new customers, (3) ensures that an unduly short timeline will not conflict with a permitted payment stablecoin issuer’s BSA/AML obligations and economic sanctions compliance requirements, and (4) aligns with current market practices. With this clarification concerning the redemption timeline, the OCC is retaining the baseline two-business-day timeline for timely redemption. The OCC believes this timeframe provides sufficient responsiveness to stablecoin holders who seek to redeem their stablecoins while also ensuring that issuers can appropriately manage liquidity demands. The OCC is not amending the rule to address comparable requirements of other jurisdictions, as those are best addressed through the determination that the Secretary of the Treasury makes pursuant to section 18(b) of the Act (12 U.S.C. 5916) and any associated reciprocal arrangements. In the event a permitted payment 98 Consistent with the revised definition, a payment stablecoin holder would become a customer of the permitted payment stablecoin issuer upon requesting redemption.

stablecoin issuer fails to timely redeem a payment stablecoin, the OCC intends to evaluate the facts and may take an appropriate enforcement action. The two-business-day timeline for timely redemption is a ceiling, and the OCC acknowledges that in order for payment stablecoins to be considered “cash equivalents” under GAAP and qualify as margin collateral under other requirements, the payment stablecoins may need to have an on-demand contractual right. Permitted payment stablecoin issuers may redeem earlier than two business days, but they may not redeem later than two business days, absent an extension of the period for timely redemption. Whether any particular payment stablecoin may qualify as margin collateral is outside the scope of this rulemaking. One commenter urged the OCC not to permit issuers to freeze redemptions, including in unusual and exigent circumstances. Other commenters recommended a narrow safe harbor or exception where suspensions or delays result from clearly defined circumstances outside the issuer’s control, such as system-wide disruptions, fraud investigations, sanctions screening, or payment-system failures, conditioned on the issuer providing notice and disclosure when the law permits. Many commenters opposed the proposed automatic seven-day stress extension and argued that it is pro-cyclical, could reinforce panic, and may undermine confidence or contribute to de-pegging. Several commenters recommended a discretionary or multi-factored approach instead of an automatic trigger. Commenters proposed alternatives including tailoring automatic extensions around reserve liquidity, requiring OCC notification of stress events and approval for an extension, a reserve-to-circulating-token trigger, and treating seven days as an outer limit rather than a mandatory delay. Commenters also requested clarity on operational application of the trigger, including whether it would be triggered on a brand-by-brand basis for multi-brand or white-labeled coins,

how to measure requests in pull-claim architectures where holders submit redemption requests but such requests are not immediately executed, whether the OCC may object or impose conditions, whether extensions apply to outstanding and subsequent requests, and queuing and communication practices during an extension. One commenter noted possible conflict where a United States issuer suspends redemption while a foreign affiliate remains redeeming. Commenters requested clearer operational expectations for redemption throughput, automation, contingency staffing, banking-rail dependence, and stress readiness. One commenter supported requiring clear rules for timely and orderly customer redemption. After considering the comments, the OCC is eliminating the automatic extension provided in proposed § 15.12(c). The OCC agrees with commenters that the automatic extension could prove pro-cyclical and trigger or exacerbate runs. At the same time, the OCC believes that it is important that the OCC receive prompt notice of any sudden spike in redemption requests, which may indicate stress at a permitted payment stablecoin issuer. Accordingly, § 15.12(d)(1) of the final rule provides that a permitted payment stablecoin issuer must provide notice to the OCC through its supervisory office within 24 hours if it receives redemption requests in excess of 10 percent of the outstanding issuance value of any brand of payment stablecoin issued by the permitted payment stablecoin issuer in a single 24-hour period. Under § 15.12(d)(2) of the final rule, a permitted payment stablecoin issuer that experiences redemption requests in excess of 10 percent of the outstanding issuance value of any brand of payment stablecoin issued by the permitted payment stablecoin issuer in a single 24-hour period may request that the OCC extend the timeframe for timely redemption. The OCC may, in its discretion, grant or deny the extension request or impose discretionary limitations upon timely redemption in accordance with section 4(a)(1)(B)(i) of the GENIUS Act (12 U.S.C. 5903(a)(1)(B)(i)). The OCC expects to use this

authority sparingly and that redemption extensions will be rare. The OCC notes that the OCC may also impose (and the permitted payment stablecoin issuer may request) discretionary limitations upon timely redemption in certain other circumstances, consistent with the statute. 99 The OCC would impose any such limit so as not to trigger or exacerbate runs or other stress events. The notification requirement in the final rule will provide the OCC with an early opportunity to assess whether such limitations may be appropriate and justified under the statute. The OCC notes that, because permitted payment stablecoin issuers may face redemption requests from payment stablecoin holders (subject to appropriate onboarding and screening), permitted payment stablecoin issuers should have in place processes to appropriately and promptly screen and onboard new customers, including in times of stress. It would be prudent for a permitted payment stablecoin issuer to provide disclosures concerning its onboarding process so that customers understand the process and how it may affect the timing of redemption (including when the permitted payment stablecoin issuer is under stress). Commenters generally supported the proposed disclosures. Many supported including additional disclosures that payment stablecoins are not insured and, in one case, not legal tender. Several commenters requested clear disclosures regarding redemption rights, timeframes, fees, reserve composition, operational disruptions, and the identity of the legal issuer responsible for redemption. Several commenters supported disclosure of redemption fees and fee changes, limits on hidden or abusive fees, point-of-transaction disclosure flexibility, and clarification that fee disclosure obligations apply to issuers rather than all market participants. Other commenters 99 See 12 U.S.C. 5904(a)(1)(B).

requested clearer allocation of disclosure responsibilities among issuers, exchanges, custodians, and intermediaries. A few commenters supported disclosures requiring such an affirmative statement, with commenters stating that the OCC should either require such disclosure, provide sample disclosures, or require a standardized disclosure related to certain prohibitions against deceptive language in the GENIUS Act (12 U.S.C. 5903(a)(9)). One commenter stated that such a requirement should be principles-based and should emphasize prominence, timing, and customer comprehension. A different commenter opposed a requirement for such disclosure, stating that such disclosures were not required by the Act, and the prohibition itself obviates the need for disclosures. The commenter further stated that to the extent the OCC believes such additional disclosures are required, the OCC should only consider requiring them if and when actual market practices or consumer confusion demonstrate a clear need. Additionally, a few commenters stated that the OCC should require disclosures that provide that the issuer’s payment stablecoins are not insured by the FDIC and not eligible for pass-through insurance. The OCC is adopting proposed § 15.12(b) and (d) but renumbered as § 15.12(c) and (e) in the final rule, with certain additional modifications. First, the paragraph includes renumbering in light of new § 15.12(a). Second, because the OCC is no longer reserving § 15.12(b)(2), the OCC has consolidated proposed § 15.12(b)(1) into final § 15.12(c) with a clarification (adding “that state” before the colon) and appropriate renumbering. Third, final § 15.12(e) includes certain disclosures beyond those proposed in § 15.12(d). The OCC believes that the baseline disclosures in proposed § 15.12(d) are appropriate and consistent with the statute but that certain additional disclosures would provide important additional clarity to customers and payment stablecoin holders. New § 15.12(e)(1)(v) would

require a permitted payment stablecoin issuer to disclose that payment stablecoins are not legal tender, issued by the United States, or guaranteed or approved by the United States. This requirement would align with the prohibition against deceptive names in section 4(a)(9) of the GENIUS Act (12 U.S.C. 5903(a)(9)) and § 15.10(c) of the final rule. New § 15.12(e)(1)(vi) would require a permitted payment stablecoin issuer to disclose that payment stablecoins are not deposits, not backed by the full faith and credit of the United States, not subject to deposit insurance by the FDIC, and not subject to share insurance by the National Credit Union Administration. This would align with the prohibition against misrepresentation of insured status in section 4(e) of the Act (12 U.S.C. 5903(e)) and the definition of payment stablecoin (which excludes deposits) in section 2(22) of the Act (12 U.S.C. 5901(22)). The OCC has legal authority to require the disclosures under sections 4(a)(1)(B)(ii), 4(a)(9), and 4(e) of the Act (12 U.S.C. 5903(a)(1)(B)(ii), (a)(9), and (e)). Waiting for market practices to develop prior to requiring such disclosures does not appear prudent, given that the benefit of disclosing this information to payment stablecoin holders outweighs the minimal burden of including these statements in disclosures to payment stablecoin holders. This burden appears particularly minimal since such redemption disclosures are mandatory regardless of whether the OCC chose to add these additional requirements. The final rule also replaces certain references to “customers” with “payment stablecoin holders” to be clear that disclosures should be readily noticeable and understandable to payment stablecoin holders, including those who have not yet become customers (i.e., payment stablecoin holders who have not interacted directly with the permitted payment stablecoin issuer, including by requesting redemption from the permitted payment stablecoin issuer). Certain requirements would, however, apply only to customers with whom the issuer has a current relationship. These

changes are appropriate in light of the change to the definition of “customer” described above. For a similar clarifying purpose, the OCC is replacing the phrase “The link to the monthly composition report” in proposed § 15.12(d)(1)(iii) with “The website that contains a link to the monthly composition report” in final § 15.12(e)(1)(iii). Final § 15.12(e)(4) does not include “that it provides,” which was included in proposed § 15.12(d)(4), because the phrase introduced a risk of ambiguity while adding no substantive description of the relevant disclosures. A few commenters provided suggestions for the format of disclosures, including that they should be on the issuer’s website, provided at the point of issuance or sale, and in a standalone format before the transaction is completed. Commenters also stated that disclosures should be prominent and obvious on the issuer’s website, application interface, and in any promotional materials. Another commenter stated that the OCC should adopt a specific standardized data format for stablecoin-related disclosures and that on-chain disclosure has its advantages. One commenter stated that the OCC should not impose technically infeasible disclosure obligations at every downstream transaction touchpoint and that there should be issuer-level disclosures rather than at the point of sale. Moreover, one commenter stated that disclosures should not be made through terms of service while another commenter stated that permitted payment stablecoin issuers should provide a fuller set of disclosures on their primary user interfaces and webpages. One commenter stated that any such disclosures should be continuously available, prominent, and linked with the issuer’s core redemption, reserve, and product-risk disclosures. A few commenters suggested that the OCC should establish safe harbors or standardized disclosure templates for payment stablecoin disclosures that emphasize clarity and brevity. The OCC declines to provide sample disclosures or a standardized format for such disclosures but notes that the disclosures must meet the requirements of § 15.12(e)(1). That

section requires that the permitted payment stablecoin issuer’s disclosures must publicly, clearly,
and conspicuously disclose the required information in plain language and in a format that is readily noticeable to payment stablecoin holders, readily understandable by payment stablecoin holders, and segregated from other information. Such sample disclosures are not necessary because the disclosure requirements are simple and clear. The OCC is not instituting a principles-based requirement because it believes that disclosing this limited additional information does not impose significant burden on permitted payment stablecoin issuers. The OCC does not believe it is prudent to pick a specific format for disclosures, given that a Federal disclosure regime specific to stablecoins did not exist prior to the passage of the Act. Therefore, the market needs to develop prior to the OCC considering whether there should be a specific format for disclosures. The OCC is not opposed to on-chain disclosures, so long as such disclosures meet the requirements in § 15.12(e). Similarly, the OCC takes no view on whether disclosures should be at the issuer level or at the point-of-sale, so long as they meet the requirements of the Act and this final rule. To the extent the disclosures are made through the terms of service, but the disclosures are not conspicuous and readily noticeable to payment stablecoin holders, such disclosures would not comply with the requirement in § 15.12(e)(1) of the final rule. The OCC is not establishing safe harbors or standardized disclosures because there may be different formats of disclosures that can satisfy the requirements in § 15.12(e), and the OCC believes the disclosure requirements are straightforward and do not necessitate further clarification beyond what is in the final rule. While the OCC agrees with commenters that stated that permitted payment stablecoin issuers should have to disclose that payment stablecoins are not insured by the FDIC, the OCC did not include any requirements related to pass-through insurance as the FDIC’s notice of

proposed rulemaking addresses the applicability of pass-through insurance, and the FDIC’s proposal has not yet been finalized. Once the FDIC finalizes its rulemaking, the OCC will consider whether any revisions to 12 CFR part 15 are necessary. Many commenters also made suggestions of other categories of disclosures the OCC should consider. One commenter stated that there should be clear disclosure requirements for permitted payment stablecoin issuers and intermediaries regarding the timing, content, and roles of each party so consumers understand the relevant risks. Commenters also suggested that permitted payment stablecoin issuers should disclose the redemption rights of payment stablecoin holders, the nature of the issuing entity, that the payment stablecoin is issued by a permitted payment stablecoin issuer, the identity of the primary Federal regulator, and a warning, if applicable, that all transactions using the payment stablecoin are not reversible. One commenter also suggested disclosures related to operational risk, including disclosures regarding blockchain network participation, all blockchain activities, risks from a network disruption, and third-party details. Another commenter stated that the OCC should work with the FDIC to require disclosures regarding how customer funds are protected by reserve requirements, 100 how customers can convert their payment stablecoins back to dollars, and information about insured and uninsured balances. Commenters also suggested prohibitions on nonbank permitted payment stablecoin issuers using the word “bank” in their names, marketing materials, websites, application interfaces, and any other communications targeted at customers. The OCC is not adopting any additional disclosure requirements in the final rule beyond the changes already discussed to § 15.12(e). With respect to disclosures surrounding 100 Similarly, one commenter stated that there should be standards for the user interfaces that people will use to access permitted payment stablecoin issuers and that those standards should describe the payment stablecoin’s relationship to reserves.

intermediaries, the OCC believes that disclosing the name of the permitted payment stablecoin issuer that issued the payment stablecoin under § 15.12(e)(1)(i) is sufficient to help customers understand the entity they can redeem from. Additionally, disclosing the primary Federal regulator might cause confusion because several Federal agencies have different responsibilities under the Act. The OCC also believes that disclosing that transactions using a payment stablecoin are not reversible, which may not always be the case, is unnecessary and could similarly cause confusion. The OCC also believes disclosure regarding blockchain activities need not be mandatory, but, to the extent issuers believe they would be helpful, they may provide this information to customers. While a nonbank permitted payment stablecoin issuer referring to itself as a “bank” is not explicitly prohibited by the Act, such representations might raise concerns under other applicable laws. Moreover, the OCC already requires public disclosure of reserve assets in the monthly composition report required under § 15.11(e) of the final rule. The OCC is not adding a disclosure requirement for the token asset identifier, but issuers may disseminate this information if it would be helpful to customers. A few other commenters asked for additional clarity related to disclosures. One commenter stated that the OCC should articulate a more defined reasonableness standard based on the net impression of the communication and provide examples of likely violations and compliant communications. One commenter asked for clarity on the responsibility allocation and stated that issuers should remain responsible for their marketing materials while digital asset service providers should be responsible for their own customer-facing representations. The commenter further stated that both should be expected to maintain controls designed to prevent misrepresentation. Another commenter stated that it would be helpful to understand which factors the OCC would consider in evaluating such disclosures. Another commenter stated that

the OCC should clarify how it will implement prohibitions on deceptive marketing practices, provide clarity around marketing practices, and strengthen the customer protection objectives of the prohibition. The commenter further stated that the OCC should clarify the factors it would consider relevant to finding a disclaimer sufficiently clear and specific and provide examples of disclaimers that would be acceptable. Another commenter stated that the OCC should establish disclosure safe harbors for clarity and brevity.
Section 15.12(e)(1) provides sufficient clarity regarding the requirements for the
disclosures required by the final rule. The disclosure requirements under § 15.12(e) apply to permitted payment stablecoin issuers, and therefore issuers are responsible for those particular disclosures. The OCC agrees that permitted payment stablecoin issuers should have controls designed to prevent misrepresentation, which would generally be part of an effective risk management program required under § 15.13 of the final rule. Permitted payment stablecoin issuers are also responsible for overseeing service provider arrangements under § 15.13(a)(7), which means that their service providers should have appropriate measures in place designed to meet the requirements of this final rule. Permitted payment stablecoin issuers may include additional disclosures as best practices. For example, depending on a permitted payment stablecoin issuer’s business model, it may be important to provide disclosures relating to the timeframe for onboarding new customers (including in times of stress). As market practices develop and the OCC gains additional experience supervising permitted payment stablecoin issuers, the OCC may consider proposing additional or revised disclosures, as appropriate. The final rule includes new § 15.12(f), which confirms that the OCC will not require a permitted payment stablecoin issuer to redeem a payment stablecoin to the extent the permitted

payment stablecoin issuer’s actions to redeem the payment stablecoin would cause the issuer to violate other applicable law. 101 The OCC is adding this provision to make clear that the OCC would not consider it a violation of the Act or part 15 if a permitted payment stablecoin issuer failed to redeem a payment stablecoin due to, for example, its obligations under applicable BSA and economic sanctions requirements because the OCC would not require such a redemption. As another example, if a foreign jurisdiction required that a permitted payment stablecoin issuer be licensed or registered to redeem a payment stablecoin in a foreign country and the issuer did not have such a license or registration, the OCC would not require the issuer to redeem a payment stablecoin from a payment stablecoin holder who is in a foreign country in which the issuer was not licensed or registered. The OCC may consider revising § 15.12(f) over time based on, among other things, the nature of the conflicting laws that arise. 102 Relationship of redemption requirements to liquidity and reserve requirements. Several commenters stated that liquidity requirements should be calibrated to the issuer’s actual redemption obligations or contractual redemption period. Some commenters requested clarification on how issuers are expected to satisfy redemption obligations under the proposed liquidity thresholds and settlement mechanics. Other commenters supported strict reserve, stress￾testing, and prompt par redemption requirements to protect consumers and reduce run risk. One commenter argued that credit risk management should focus on actual counterparty and redemption risk rather than temporary fair-value fluctuations, particularly for reserves held at supervised insured depository institutions. Commenters also requested flexibility for affiliate and cross-border reserve structures, including reserve rebalancing across regulated affiliates and 101 “Applicable law” does not include any State law that is preempted. 102 The OCC will scrutinize attempts to inappropriately use § 15.12(f) in a manner that attempts to evade the provisions of the GENIUS Act and 12 CFR part 15.

recognition of on-chain reserves under reciprocity arrangements. Comments related to liquidity and risk management requirements are addressed in the sections of the preamble discussing §
15.11 and § 15.13, respectively.
Fees.
Commenters were divided on whether redemption fees should be permitted. Some commenters supported allowing fees if they are market-driven, transparent, proportionate, and tied to genuine processing costs. One commenter also argued that minting and burning fees are ordinary in commercial transactions and may provide needed revenue in low-rate environments. Other commenters supported prohibiting redemption fees that reduce the value received below par, while distinguishing ancillary service charges such as foreign exchange conversion or expedited settlement. The GENIUS Act clearly contemplates that permitted payment stablecoin issuers may charge fees, subject to appropriate disclosures. See, e.g., section 4(a)(1)(B)(ii) of the Act (12 U.S.C. 5903(a)(1)(B)(ii)). Accordingly, the OCC is not limiting permitted payment stablecoin issuers from charging properly disclosed fees except in the event of liquidation for failure to meet liquidity, capital, or operational backstop requirements, or pursuant to an enforcement action, as appropriate. 103 Foreign jurisdictions. One commenter requested that the OCC address issuers operating in foreign jurisdictions and the risk that economically similar instruments issued under different regimes could confuse holders about reserve backing and redemption rights. Disclosure requirements applicable to permitted payment stablecoin issuers and the requirements of section 18 of the GENIUS Act 103 A permitted payment stablecoin issuer may, for example, use a properly disclosed fee structure to impose higher fees on redemption requests for small amounts of payment stablecoins or for redemption requests arising from foreign jurisdictions.

(12 U.S.C. 5916), its implementing regulations, and any conditions imposed thereunder should help to address potential issues relating to confusion. Multiple chains. Commenters requested clarification on how reserve requirements, redemption timelines, reporting obligations, and the 10 percent threshold apply when issuance is distributed across multiple chains with different finality characteristics. Commenters also requested clarification that cross-chain and cross-network interoperability activities directly support issuance and redemption and that the OCC address the operational, settlement, interoperability, and control risks of cross-chain transfers used to meet redemption demands. The final rule applies in a technology-neutral manner and thus its application does not change based on the particular blockchain on which a payment stablecoin operates. The 10 percent threshold applies on a per￾brand basis. With respect to interoperability, section 12 of the GENIUS Act (12 U.S.C. 5912) provides that the Federal payment stablecoin regulators, in consultation with the National Institute of Standards and Technology, other relevant standard-setting organizations, and State bank and credit union regulators, shall assess and, if necessary, may prescribe standards to promote interoperability. The OCC is actively engaging in assessing issues relating to interoperability, in consultation with other regulators. The OCC is not, however, imposing interoperability standards in this rulemaking. Civil recovery. One commenter recommended tolling the ordinary two-business-day redemption timeframe upon receipt of a qualifying civil recovery order until the order is satisfied, requiring the issuer to satisfy order-related redemptions before ordinary requests and notify the OCC within 24 hours. The commenter stated that qualifying orders should include pre-judgment

restraining orders under 18 U.S.C. 983(j), civil forfeiture orders under 18 U.S.C. 981 or 21 U.S.C. 881, restitution orders in Federal criminal proceedings, and writs of execution or judgment liens. This comment addresses an issue that is generally outside the scope of this rulemaking. Accordingly, the OCC is not revising the rule to address the issue at this time but may consider it as part of future rulemakings addressing part 15. The OCC may, in the interim, use its reservation of authority to toll the two-business-day redemption timeframe in connection with a civil order, as appropriate. Finally, the OCC notes that the requirements of § 15.12 apply only to the redemption of a payment stablecoin by the permitted payment stablecoin issuer (including any entity acting as agent on behalf of the permitted payment stablecoin issuer) and do not apply to secondary market trading.
4. Risk Management (§ 15.13)
Section 4(a)(4)(A)(iv) of the GENIUS Act (12 U.S.C. 5903(a)(4)(A)(iv)) provides that
the OCC must issue regulations implementing appropriate operational, compliance, and information technology risk management principles-based requirements and standards that are tailored to the business model and risk profile of permitted payment stablecoin issuers and are consistent with applicable law. This provision also requires that Bank Secrecy Act and sanctions compliance standards be implemented. The Bank Secrecy Act and sanctions compliance requirements are addressed in a different proposed rule. 104 Proposed § 15.13 addressed the remaining requirements and standards required under section 4(a)(4)(A)(iv) of the GENIUS Act (12 U.S.C. 5903(a)(4)(A)(iv)). Proposed § 15.13 also addressed interest rate risk management standards under section 4(a)(4)(A)(iii) of the GENIUS Act (12 U.S.C. 5903(a)(4)(A)(iii)). 104 See 91 FR 37840 (June 24, 2026).

a. Overview of Changes from Proposed Rule to Final Rule for § 15.13 The OCC is adopting § 15.13(a)(1) through (a)(5) as proposed except for changes to four provisions. In final § 15.13(a)(1)(i) on internal controls and information systems, the description of the organizational structure no longer includes an internal control structure. The final version of this paragraph also has a new phrase at the end; the OCC moved the proposed segregation of duties to this phrase and added a reference to dual controls. In final § 15.13(a)(2)(i), the phrase “size, complexity, or scope of operations” has been moved before “permitted payment stablecoin issuer” for clarity. In final § 15.13(a)(3)(ii), the phrase “adequate” is changed to “sufficient” and moved after the term information, and “to an extent commensurate with their duties” now qualifies the information sufficient for management and the board of directors to assess the level of interest rate exposure risk. Both of these changes are meant to clarify the expectations related to the information provided in periodic reporting to management. Additionally, other technical edits were made to final § 15.13(a)(4) to enhance readability of the provision. The agency is adopting § 15.13(a)(6) on insider and affiliate transactions with several revisions. Paragraph (a)(6)(i) clarifies that a permitted payment stablecoin issuer must ensure the listed conditions are satisfied alone and in the aggregate. Additionally, the OCC has replaced proposed § 15.13(a)(6)(i)(A), which addressed transactions that would be excessive or pose significant risks of material financial loss, with § 15.13(a)(6)(i)(A) and (B). The final § 15.13(a)(6)(i)(A) addresses transactions that are quantitatively detrimental in light of the business model of the permitted payment stablecoin issuer. Transactions posing significant risks of material financial loss are covered in final § 15.13(a)(6)(i)(B). The OCC is adopting proposed § 15.13(a)(6)(i)(B) and (C), renumbered as § 15.13(a)(6)(i)(C) and (D), as proposed with

technical edits to add commas and replace “or” with “and” when referring to transactions with, or involving, non-insiders and non-affiliates. The OCC is adopting proposed § 15.13(a)(7) and (a)(8) as proposed, except that final § 15.13(a)(7)(ii) expands the list of applicable requirements to include GENIUS Act requirements and has technical edits to move the phrase “by contract” to enhance readability. There is also a technical change in § 15.13(a)(7)(iii) to replace “permitted payment stablecoin issuers” with “a permitted payment stablecoin issuer.” The final rule includes new § 15.13(a)(9) and (a)(10). Section 15.13(a)(9) concerns monetization and stress testing, with requirements addressing the capability of a permitted payment stablecoin issuer to support timely redemption, the ability of a permitted payment stablecoin issuer to reliably access and monetize reserve assets, and regular stress testing of the reserve asset portfolio. Section 15.13(a)(10) covers foreign exchange risk and the use of foreign exchange risk management instruments by permitted payment stablecoin issuers. The OCC is adopting § 15.13(b) as proposed with changes to five paragraphs. First, in § 15.13(b)(2) addressing board oversight of an information technology and security program, the proposal’s reference to a specific Information Technology and Security Officer title has become a reference to a qualified individual responsible for the program. Second, whereas proposed § 15.13(b)(4)(i) would have required a permitted payment stablecoin issuer’s information technology program to ensure the security and confidentiality of records containing nonpublic personal information, final § 15.13(b)(4)(i) also requires the program to ensure the security and confidentiality of sensitive customer information. Third, final § 15.13(b)(6) is modified to clarify that it concerns the permitted payment stablecoin issuer’s ability to monitor and adjust the program. Related to this clarification, final

§ 15.13(b)(6)(i) includes the proposed language for § 15.13(b)(6) except for a phrase related to evaluation and adjustment of the program, and the OCC is adding § 15.13(b)(6)(ii), which provides that the permitted payment stablecoin issuer must evaluate and adjust the information technology and security program, as appropriate, based on the monitoring required by § 15.13(b)(6)(i). Fourth, final § 15.13(b)(7) is modified for non-substantive edits, to add clarifying language, and to separate the provision into § 15.13(b)(7)(i)(A) through (C). In addition, final § 15.13(b)(7)(ii) covering notification of unauthorized access to sensitive customer information for a group of customers includes clarifying edits, including that the proposal’s reference to a group of files instead refers to the files of a group of customers. Fifth, final § 15.13(b)(8) on information technology resilience removes the specific reference to disruptions, and it corrects a preposition in the proposal. b. Description of Comments and General Overview of Final Rule Approach The GENIUS Act requires that the regulation’s requirements and standards be “principles-based.” Accordingly, the OCC proposed flexible standards in § 15.13 that scaled based on the nature, scope, and risk of a permitted payment stablecoin issuer’s activities. Most of the standards in proposed § 15.13 were adapted from relevant provisions of 12 CFR part 30, appendices A and B, which in turn implement 12 U.S.C. 1831p-1. 105 The OCC identified standards from appendices A and B of 12 CFR part 30 that fit the requirements of section 4(a)(4)(A)(iii) or 4(a)(4)(A)(iv) of the GENIUS Act (12 U.S.C. 5903(a)(4)(A)(iii) or (a)(4)(A)(iv)) and then, consistent with the statute, adapted and tailored those standards to the 105 While the standards listed in 12 U.S.C. 1831p-1 provide a useful reference point for standards that may be applicable to permitted payment stablecoin issuers, the OCC is not invoking 12 U.S.C. 1831p-1 as a source of authority for issuing these risk management requirements. Accordingly, the specific requirements for violating 12 U.S.C. 1831p-1 would not necessarily apply to permitted payment stablecoin issuers (e.g., a mandatory plan).

business models of permitted payment stablecoin issuers, as appropriate. In addition, on July 14, 2025, the OCC issued a joint statement, together with the Federal Reserve and FDIC, on Risk Management Considerations for Crypto-Asset Safekeeping, 106 and the standards in proposed § 15.13 were consistent with the considerations described in the joint statement. 107 The OCC is adopting proposed § 15.13 with targeted changes. The final rule retains the principles-based and technology-neutral approach of the proposed rule, but the final rule has been modified to provide additional clarity, include stress test requirements, and address foreign exchange risk management. A description of the general comments received pertaining to proposed § 15.13 and the OCC’s responses is below, followed by a description of specific comments relevant to proposed § 15.13 and changes made in the final rule. Many commenters opined on whether § 15.13 should be principles-based as opposed to prescribing specific requirements. For example, a few commenters suggested that principles￾based requirements and standards allow for needed flexibility while maintaining strong governance, operational resilience, and financial controls. Other commenters recommended principles-based requirements and standards accompanied by clear supervisory guidance. One commenter noted the importance of providing sufficient detail to enable consistent compliance and examination if maintaining a principles-based approach. A few commenters indicated that a principles-based approach allows for better scaling to an institution’s size, complexity, and risk profile. 106 See OCC News Release 2025-68, “Agencies Issue Joint Statement on Risk-Management Considerations for Crypto-Asset Safekeeping” (July 14, 2025), https://www.occ.gov/news-issuances/news-releases/2025/nr-ia-2025- 68.html. 107 Consistent with the recommendations in the Digital Financial Technology Report, the OCC intends to provide additional clarity with respect to digital asset activities undertaken by OCC-supervised entities.

Additionally, many commenters discussed whether the rule should remain technology￾neutral. For example, several commenters suggested that in order to remain principles-based, § 15.13 should not impose specific requirements around the use of particular technical elements of stablecoins due to rapid technological changes occurring in the industry. Other commenters, however, suggested that while requirements in general should be principles-based, the framework should focus on technology-specific risks given the technological nature of the industry. In particular, these commenters recommended addressing the risks or benefits associated with distributed ledger technology in greater detail.
Section 4(a)(4)(A)(iv) of the GENIUS Act (12 U.S.C. 5903(a)(4)(A)(iv)) provides that
risk management standards and requirements must be “principles-based.” In addition, the nature of many of the areas covered by the § 15.13 risk management provisions is such that implementation will depend on the business model, activities, and circumstances of each institution. Because of this nature, principles-based requirements are appropriate as a matter of policy as well as required by law. Additionally, the OCC has historically taken a technology￾neutral approach to rulemaking, which it intends to continue. Employing a technology-neutral approach will help ensure that the requirements of 12 CFR part 15 adequately address the core risks applicable to permitted payment stablecoin issuers even as technology changes. Thus, while the final rule includes certain references to concepts that generally apply to distributed ledger technology (e.g., private keys), the final rule does not favor one particular technological solution over another. Several commenters suggested requiring real-time monitoring of smart contract activity, distributed ledger activity, reserve management, and redemption activity. A few commenters suggested requiring real-time and API-based reporting for regulators. The above discussion of

§ 15.11(a) considers these and similar comments with respect to how permitted payment stablecoin issuers satisfy their reserve requirements under the GENIUS Act, and the below discussion of § 15.14 relates to audits, reports, and supervision. The final rule does not include a real-time monitoring requirement for permitted payment stablecoin issuers (consistent with the technology-neutral and principles-based approach that the OCC has taken with respect to § 15.13). The OCC notes, however, that the final rule requires permitted payment stablecoin issuers to back payment stablecoins with reserve assets on at least a 1 to 1 basis at all times. Refer to the discussions of § 15.11 and § 15.14 for more about how permitted payment stablecoin issuers satisfy this requirement. Several commenters suggested allowing a permitted payment stablecoin issuer that is an insured depository institution subsidiary to satisfy risk management requirements through the insured depository institution’s risk management framework. Commenters making this recommendation argued that doing so would reduce duplication of requirements. Some commenters made this recommendation specifically in situations where the parent insured depository institution’s framework explicitly encompasses the permitted payment stablecoin issuer’s specific activities and risk profile. Other commenters suggested that compliance may be based on a parent’s risk management framework where the parent’s framework already addresses the risks covered in § 15.13 in a manner that is at least equivalent in outcomes. A few commenters recommended that any compliance based on a parent’s framework be subject to supervisory confirmation, rather than automatically and conclusively determining that the subsidiary is in compliance, and that the OCC retain discretion to require additional or standalone risk management for risks that are not adequately addressed by the parent’s framework. Alternatively, one commenter argued that a permitted payment stablecoin issuer that

is a subsidiary of an insured depository institution should not be allowed to satisfy risk management requirements by reference to the parent institution’s existing framework and that in all cases compliance should be demonstrated by the permitted payment stablecoin issuer. A parent insured depository institution will separately be subject to the requirements of 12 CFR part 30, Appendices A and B, and other applicable requirements, and the OCC will separately supervise the insured depository institution parent’s risk management. A permitted payment stablecoin issuer that is a subsidiary of an insured depository institution may rely on the parent’s risk management framework to the extent that the parent’s risk management framework addresses the requirements of the GENIUS Act and 12 CFR part 15 and to the extent the management of the permitted payment stablecoin issuer plays a meaningful role in the risk management framework related to the permitted payment stablecoin issuer’s activities. Similarly, a permitted payment stablecoin issuer that is an SPV may rely on the risk management framework of its parent entity, provided that the parent entity’s risk management framework complies with and adequately addresses § 15.13. The OCC will reduce duplicative regulatory requirements to the fullest extent possible. Many commenters discussed whether the rule should include additional tailoring of risk management requirements and standards across permitted payment stablecoin issuers. Several commenters called for consistent standards for all permitted payment stablecoin issuers regardless of size, which they asserted would establish a common safety and soundness baseline and promote regulatory clarity. Many other commenters supported a tailored framework to allow community banks better access to the stablecoin market. A few commenters advocated for a combination of standardized and tailored frameworks. For example, one commenter suggested that there be baseline risk management standards across permitted payment stablecoin issuers

with tailoring that takes into account other regulatory requirements with which the permitted payment stablecoin issuer is already required to comply. One commenter advocated for tailored requirements based on specific risk profile and complexity rather than simply by size. The Act requires “risk management principles-based requirements and standards ... that are tailored to the business model and risk profile of permitted payment stablecoin issuers.”108 Consistent with the statutory requirement, it is appropriate to require risk management requirements and standards appropriate to the size and complexity of a permitted payment stablecoin issuer and the nature, scope, and risk of its activities. Accordingly, the final rule includes broad principles-based language that accounts for the size and complexity of a Some commenters suggested strategies to address challenges posed by interoperability in payment stablecoin transactions. The above discussion of § 15.12 addresses commenters who referred to interoperability in the context of certain payment stablecoin transactions (issuance and redemption). Some commenters advocated for developing mandatory interoperability standards in coordination with the National Institute of Standards and Technology (NIST). Other commenters opposed including interoperability standards in the final rule. Some favored including high-level principles-based standards. The final rule does not mandate interoperability standards in recognition of the relative novelty of the payment stablecoin industry. The OCC notes, however, that under section 12 of the GENIUS Act (12 U.S.C. 5912), the primary Federal payment stablecoin regulators, in consultation with NIST, other relevant standard-setting organizations, and State bank and credit union regulators, shall assess and, if necessary, may 108 12 U.S.C. 5903(a)(4)(A)(iv).

prescribe standards for permitted payment stablecoin issuers to promote compatibility and interoperability. As the industry develops, the OCC will continue to work with the other regulators to assess whether it is necessary to prescribe standards for permitted payment stablecoin issuers to promote compatibility and interoperability. A few commenters suggested that permitted payment stablecoin issuers should be required to acquire insurance against certain risks, for example, cyber, crime, or professional liability insurance. A few commenters suggested that there should be minimum coverage requirements, potentially tailored based on size and complexity of the permitted payment stablecoin issuer. A few commenters suggested that disclosure of insurance coverage should be required to regulators but not the public. A few commenters argued that a potential problem posed by requiring insurance coverage may be the lack of availability of particular types of insurance. The OCC recognizes insurance as a piece of risk management but does not prescribe particular private insurance requirements. This approach is consistent with the OCC’s treatment of other OCC-supervised entities.
c. Description of Proposed Rule, Comments, and Final Rule
Proposed § 15.13(a)(1) would have required that a permitted payment stablecoin issuer have internal controls and information systems that are appropriate for the size and complexity of the permitted payment stablecoin issuer and the nature, scope, and risk of its activities and that provide for: (i) an organizational structure with appropriate segregation of duties and an internal control structure that establishes clear lines of authority and responsibility for monitoring adherence to established policies; (ii) effective risk assessment; (iii) timely and accurate financial, operational, and regulatory reporting, including with respect to reports required under

proposed part 15; (iv) adequate procedures to safeguard, manage, control, and monetize assets, including reserve assets; and (v) compliance with applicable laws and regulations. Internal controls refer to the systems, policies, procedures, and processes effected by the board of directors and other personnel to safeguard permitted payment stablecoin issuer assets, limit or control risks, achieve permitted payment stablecoin issuer objectives, and ensure compliance with applicable laws and regulations. The internal controls standards in proposed § 15.13(a)(1) were modeled on the internal controls standards in 12 CFR part 30, with some adjustments to accommodate the particular activities and risks of permitted payment stablecoin issuers. A few commenters discussed requirements relating to the risk assessments under § 15.13(a)(1). One commenter suggested taking an open-methodology approach where OCC examiners could audit the risk assessment methodology rather than only its output and the OCC could establish principles for what constitutes an acceptable approach rather than needing to endorse any specific methodology. Several commenters discussed the benefits of real-time or continuous risk monitoring and reporting. One commenter opined that adequate risk assessment requires continuous monitoring of the full cycle of stablecoin activity, including both on- and off-chain activity. Another commenter suggested that risk assessment frameworks should be assessed against a baseline standard for all permitted payment stablecoin issuers. Some commenters supported strong internal controls, including segregation of duties, independent validation, dual or multi-party approvals, and strong governance over issuance systems. Another commenter noted that, with respect to reserve asset management, while assets should be appropriately segregated and independently controlled, any personnel or governance requirements should be proportional to the size and complexity of the issuer and implemented through broader reserve asset and risk management standards rather than as a separate standalone

requirement. In contrast, some commenters suggested more specific direction concerning the appropriate organizational structure and responsibilities, such as greater clarity on the oversight role of the board of directors and requiring boards of directors to approve and implement a risk appetite statement. The OCC is adopting paragraph (a)(1) as proposed with a change in § 15.13(a)(1)(i).
Section 15.13(a)(1)(i) has been modified to delete “with appropriate segregation of duties and an
internal control structure” and add “, including appropriate segregation of duties and dual controls.” These modifications are not substantive but instead clarify that segregation of duties and dual controls may be elements of an organizational structure that facilitates internal controls. In response to commenters, the OCC is not mandating any particular method for risk assessment, and the OCC expects that different permitted payment stablecoin issuers may take different approaches based on the size and complexity of the issuer and the nature, scope, and risk of its activities. This approach is most consistent with the statutory requirement to provide tailored and principles-based risk management standards. Effective risk management depends on an effective risk assessment since a permitted payment stablecoin issuer cannot effectively manage its risks without an understanding of its risk profile. Procedures to safeguard, manage, control, and monetize assets will be expected to include measures to monitor and ensure the deposit concentration and diversification requirements are met. Likewise, procedures will be expected to address potential risks related to fraud and the theft of payment stablecoins or other assets. The OCC proposed that § 15.13(a)(2) require permitted payment stablecoin issuers to have an internal audit system that is appropriate to the size and complexity of the permitted payment stablecoin issuer and the nature, scope, and risk of its activities and that provides for (i) adequate monitoring of the system of internal controls through an internal audit function, or for a

permitted payment stablecoin issuer whose size, complexity, or scope of operations does not warrant a full-scale internal audit function, a system of independent reviews of key internal controls; (ii) independence and objectivity; (iii) qualified persons responsible for the audit function; (iv) adequate independent testing and review of internal controls and information systems, verification of published information available to customers, calculations for required reserves, and regulatory filings; (v) adequate documentation of tests and findings and any corrective actions; (vi) verification and review of management actions to address deficiencies; and (vii) review by the institution’s audit committee or board of directors of the effectiveness of the internal audit systems. A few commenters discussed requirements related to internal audit systems in proposed § 15.13(a)(2). A commenter suggested specific requirements to guide internal audit structure. Specific suggestions related to revising the rule to reference specific proprietary internal audit practice frameworks and clarifying who constitutes a qualified person by requiring that such persons possess appropriate education, relevant experience, and certain professional certifications that demonstrate competency in internal auditing or other relevant expertise. A few commenters suggested that the OCC clarify structural independence expectations. One commenter suggested that the OCC address governance as a distinct area of internal audit coverage; require that procedures be developed, implemented, and adhered to; ground internal audit monitoring in a risk-based approach; require clear ownership and timelines in management action plans; clarify internal audit’s purview over all material risk areas in § 15.13; require all permitted payment stablecoin issuers to establish an internal audit function; and rely on internal audit work in carrying out its supervision activities. A few commenters recommended that the

rule require third-party or independent audits, or at least that systems have the records or ability to be audited by an independent party. After careful consideration of the comments, the OCC is adopting paragraph (a)(2) as proposed except for a clarifying edit to § 15.13(a)(2)(i). Internal audit systems are intended to provide objective, independent reviews of permitted payment stablecoin issuer activities, internal controls, and information systems to help the board of directors and management monitor and evaluate internal control adequacy and effectiveness. An internal audit system, among other items, is expected to independently test and review systems, as appropriate, related to (1) a permitted payment stablecoin issuer’s compliance with the GENIUS Act and requirements in any final rules implementing the GENIUS Act; (2) payment systems; 109 and (3) third-party risk management. Well-planned, properly structured audit programs are essential to effective risk management and internal control systems. Effective internal audit programs are a critical defense against fraud and provide vital information to the board of directors about the effectiveness of internal control systems. An internal audit program’s coverage includes evaluating compliance systems, safeguards around use of payment systems, and risks posed by relationships with and dependence on third parties. While it is important that internal audit functions be conducted by qualified persons with an appropriate level of independence from other business lines, the final rule does not mandate a particular organizational structure (for example, three lines of defense).
Section 15.13(a)(2) does not prescribe a one-size-fits-all approach to risk management. Smaller
permitted payment stablecoin issuers with a lower risk profile may be able to comply using a simpler, less delineated organizational structure, or may be able to outsource certain functions 109 A payment system is the mechanisms, rules, institutions, people, markets, and agreements that make the exchange of payments possible. See OCC, Comptroller’s Handbook, “Payment Systems,” 99 (2021).

such as the internal audit function, while larger permitted payment stablecoin issuers, with higher risk profiles, may require organizational structures with more clearly delineated risk management functions, including internal audit personnel. The OCC’s approach is grounded in the principles￾based framework, and prescriptive requirements or references to proprietary frameworks or certifications are unnecessary for the rule text. Moreover, a permitted payment stablecoin issuer that is a subsidiary of an insured depository institution or that is a SPV may rely on the audit framework of its parent, provided the parent’s framework complies with § 15.13. Final § 15.13 does not mandate the use of an external audit, but such an audit may be appropriate for some permitted payment stablecoin issuers. Moreover, permitted payment stablecoin issuers must comply with the requirements of § 15.14, including applicable audit requirements. Proposed § 15.13(a)(3) addressed interest rate risk and would have required a permitted payment stablecoin issuer to (i) manage interest rate risk in a manner that is appropriate to the size and complexity of the permitted payment stablecoin issuer and the complexity of its assets and liabilities and (ii) provide for periodic reporting to management and the board of directors regarding interest rate risk with adequate information for management and the board of directors to assess the level of risk. 110 Several commenters discussed the interest rate risk provisions in proposed § 15.13(a)(3). Some commenters suggested that the OCC replace specific requirements in other provisions of the rule (e.g., weighted average maturity in proposed § 15.11) with more robust risk management 110 The GENIUS Act explicitly authorizes interest rate risk management standards under section 4(a)(4)(A)(iii) (12 U.S.C. 5903(a)(4)(A)(iii)) whereas section 4(a)(4)(A)(iv) (12 U.S.C. 5903(a)(4)(A)(iv)) authorizes the other requirements and standards proposed in § 15.13. The OCC proposed that interest rate risk management standards be included under proposed § 15.13 since it is a risk management standard like the other standards already included in proposed § 15.13.

capabilities for interest rate risk (e.g., stress testing, haircuts). Another commenter suggested that the OCC include interest rate risk, among other items, in capital requirements. The OCC is adopting § 15.13(a)(3) as proposed with clarifying edits. While permitted payment stablecoin issuers hold reserve assets that may, depending on their type, have limited or no duration (e.g., in the case of demand deposits), it is still important for permitted payment stablecoin issuers to be mindful of this risk, particularly in light of the role of interest rate risk in the previous failures of money market funds, whose investments, like those of permitted payment stablecoin issuers, were supposed to be limited to short-duration safe assets. 111 Increases in interest rates, particularly in short time periods, can reduce the value of interest￾sensitive reserve assets, potentially impacting their fair value, marketability, and the permitted payment stablecoin issuer’s ability to meet redemptions. Similarly, changes in interest rates can affect the earnings and long-term viability of permitted payment stablecoin issuers since their earnings may rely in substantial part on interest earned on reserve assets. Likewise, increases in interest rates may reduce the demand for payment stablecoins, particularly since permitted payment stablecoin issuers are prohibited from paying interest to stablecoin holders solely in connection with the holding, use, or retention of payment stablecoins under final § 15.10(c)(4). Proposed § 15.13(a)(4) would have required a permitted payment stablecoin issuer’s asset growth to be prudent and commensurate with a permitted payment stablecoin issuer’s risk management capabilities, operational capacity, and staffing. A couple of commenters addressed 111 Mismanagement of interest rate risk was a leading cause of failure in two of the three money market funds in the United States in which the net asset value of the fund fell below $1 (also referred to as “breaking the buck”), ultimately leading to liquidation. See In the Matter of John E. Backlund, et al., Investment Company Act Release No. 23639 (January 11, 1999) (SEC administrative order involving the Community Bankers U.S. Government Money Market Fund liquidated in 1994); In the Matter of First Multifund Advisory Corp. and Milton Mound, Initial Decision, File No. 3-5881 (December 29, 1982) (SEC initial decision involving the First Multifund for Daily Income liquidated in 1978).

this provision. One stated that the interest rate exposure, asset growth, asset quality, and earnings standards from 12 CFR part 30 should be adapted to focus on reserve composition, liquidity, redemption capacity, operational scalability, and run-risk management rather than traditional banking intermediation. Another suggested that the risk management standards should include an emphasis on growth management. The OCC is adopting § 15.13(a)(4) as proposed with clarifying edits. While there are no hard limits to how quickly permitted payment stablecoin issuers may grow, permitted payment stablecoin issuers must ensure that growth does not undercut the permitted payment stablecoin issuer’s capabilities to comply with the requirements of this rule and other applicable law. For example, rapid issuance of new payment stablecoins would require a rapid increase in reserves, and permitted payment stablecoin issuers must ensure that they maintain the capabilities to maintain these reserves in compliance with § 15.11 and maintain the ability to access and monetize the reserves in order to meet redemption requests. The approach in the final rule is sufficiently tailored to the business models of permitted payment stablecoin issuers and balances flexibility with the need to appropriately manage the risks associated with asset growth. Proposed § 15.13(a)(5) would have required that a permitted payment stablecoin issuer establish and maintain a risk management system that is commensurate with the permitted payment stablecoin issuer’s size and complexity and the nature and scope of its operations to evaluate and monitor earnings and ensure that earnings are sufficient to support operations and maintain the capital levels that would be required under subpart E of proposed part 15. Commenters generally supported requiring permitted payment stablecoin issuers to adopt risk management systems commensurate with their size and complexity and the nature and scope of their operations. Some commenters recommended including additional and more prescriptive

requirements with respect to how a permitted payment stablecoin issuer monitors its earnings and other risks. Some commenters stated that the rule should include more bank-like risk management requirements. The OCC is adopting § 15.13(a)(5) as proposed. To reflect the distinct characteristics of permitted payment stablecoin issuers, the standards on earnings in § 15.13(a)(5) do not include all the listed elements in paragraph II.H in appendix A to 12 CFR part 30, from which the earnings standard in proposed § 15.13(a)(5) was adapted. Permitted payment stablecoin issuers must nevertheless comply with the overarching requirement to evaluate and monitor earnings. It may be particularly important for permitted payment stablecoin issuers to evaluate the volatility and sustainability of earnings, since changes in short-term interest rates could have sudden impacts on permitted payment stablecoin issuer earnings. Section 15.13(a)(5) provides risk management requirements that are appropriately tailored to the business model of permitted payment stablecoin issuers. The OCC declines to include additional prescriptive requirements in the rule text in keeping with the principles-based approach to risk management under 12 CFR
part 15 and section 4(a)(4)(A)(iv) of the GENIUS Act (12 U.S.C. 5903(a)(4)(A)(iv)).
Proposed § 15.13(a)(6) addressed insider and affiliate transactions and was intended to protect a permitted payment stablecoin issuer from entering into detrimental transactions with insiders or affiliates. Under proposed paragraph (a)(6)(i), a permitted payment stablecoin issuer would have been required to ensure that transactions between the permitted payment stablecoin issuer and insiders or affiliates: (1) are not excessive and do not pose significant risks of material financial loss; (2) are conducted on terms that are the same or at least as favorable to the permitted payment stablecoin issuer as those prevailing at the time for comparable transactions with or involving non-insiders or non-affiliates (or in the absence of comparable transactions, are

offered on terms and under circumstances that, in good faith, would be offered to, or would apply to non-affiliates or non-insiders); and (3) are appropriately documented and reviewed by the board of directors. Proposed paragraph (a)(6)(ii) would have required a permitted payment stablecoin issuer to appropriately monitor and validate compliance with these requirements. Some commenters requested additional clarity with respect to the scope of transactions that were prohibited under proposed § 15.13(a)(6). Some stated that the OCC should define what is “excessive.” Others stated that the paragraph should incorporate additional provisions from Regulation W (12 CFR part 223) or Regulation O (12 CFR part 215). Others cautioned against using a more prescriptive or quantitative approach for insider and affiliate transactions. One commenter stated that the proposal needs further clarification, as the proposal used a principles￾based standard that does not reflect differences among issuers. The commenter recommended separate rules for insured depository institution subsidiaries and nonbank permitted payment stablecoin issuers. Some commenters stated that § 15.13(a)(6) was appropriately scoped and tailored. The final rule modifies paragraph (a)(6) to provide more clarity while maintaining a principles-based approach. First, paragraph (a)(6)(i) has been modified to include the phrase “alone or in the aggregate” to clarify the scope of transactions between the permitted payment stablecoin issuer and its affiliates or insiders to which paragraph (a)(6)(i) applies. In addition, the OCC has modified paragraph (a)(6)(i)(A) to remove the word “excessive” and provide greater specificity as to the types of transactions prohibited under the final rule. Paragraph (a)(6)(i)(A) of the final rule prohibits transactions that are quantitatively detrimental to the permitted payment stablecoin issuer in light of the business model of the permitted payment stablecoin issuer. The degree of risk and potential loss associated with one or more transactions is dependent on the

business model of the permitted payment stablecoin issuer. As a result, the particular business model will be relevant to whether a particular transaction, a series of transactions, or transactions in the aggregate would be appropriate for a permitted payment stablecoin issuer to consider in the context of fulfilling its § 15.13 risk management obligations. A permitted payment stablecoin issuer that conducts insider and affiliate transactions consistent with sections 22(g), 22(h), 23A, and 23B of the Federal Reserve Act (12 U.S.C. 375a, 375b, 371c, 371c-1) and the implementing regulations of those sections (Regulations O and W) is likely to satisfy its § 15.13(a)(6)(i)(A) risk management obligations. Paragraph (a)(6)(i)(B) of the final rule incorporates the requirement from proposed § 15.13(a)(6)(i) that transactions between a permitted payment stablecoin issuer and its affiliates or insiders do not pose significant risks of material financial loss. Within the language proposed at § 15.13(a)(6)(i)(B), the OCC is making non-substantive clarifying edits. The OCC is adopting the remainder of § 15.13(a)(6) as proposed with renumbered paragraphs. Proposed § 15.13(a)(7) addressed requirements for overseeing third-party service provider arrangements. Specifically, a permitted payment stablecoin issuer must (i) exercise appropriate due diligence in selecting its service providers; (ii) require its service providers by contract to implement appropriate measures designed to meet the requirements of part 15; and (iii) as appropriate, monitor its service providers to confirm they have satisfied their obligations under proposed part 15. Several commenters requested clarification on third-party risk management practices. For example, a few requests for clarification concerned whether banks may oversee stablecoin￾related programs through established program-management structures. A few comments requested clarification that regulated entities are responsible for compliance outcomes even when

relying on third-party providers. Other comments requested clarification that evaluating a permitted payment stablecoin issuer’s service provider oversight program requires assessing performance in addition to contractual provisions. Some commenters requested robust third￾party risk management expectations given community banks’ reliance on third-party technology partners in the digital assets space. Other commenters requested specific reference to third-party service providers in the rule, for example, by referencing the establishment and monitoring of service level agreements as a component of the contractual and monitoring requirements in § 15.13(a)(7). The OCC is adopting § 15.13(a)(7) as proposed with two minor changes. The final rule includes a reference to compliance with the GENIUS Act in addition to compliance with part 15. Paragraph (a)(7) provides an appropriately robust and principles-based approach with respect to third-party risk management. As part of this monitoring, a permitted payment stablecoin issuer must review audits, summaries of test results, or other equivalent evaluations of its service providers. The final rule also moves the phrase “by contract” for clarity. Proposed § 15.13(a)(8) would have required a permitted payment stablecoin issuer to (i) appropriately monitor and validate compliance with the requirements of § 15.11 and (ii) manage liquidity and concentration risk in a manner that is appropriate to the business model and risk profile of the permitted payment stablecoin issuer. As discussed above, several commenters recommended that the OCC use a stress testing framework in place of the prescriptive and quantitative requirements in proposed § 15.11. Consistent with this feedback, the OCC is adopting § 15.13(a)(8) as proposed but is also adopting new § 15.13(a)(9), which provides monetization and stress testing requirements. Under the new § 15.13(a)(9)(i), a permitted payment stablecoin issuer must ensure that the reserve asset

portfolio, taken as a whole, is capable of supporting timely redemption under both normal and stressed conditions, including by conducting analyses considering a range of redemption scenarios. 112 Under § 15.13(a)(9)(ii), a permitted payment stablecoin issuer must also maintain and demonstrate to the OCC the ability to reliably access and monetize reserve assets necessary to meet redemption requests in normal and stressed conditions, taking into account: (A) market access; (B) financing channels; (C) haircut assumptions; and (D) operational readiness. Additionally, under § 15.13(a)(9)(iii), a permitted payment stablecoin issuer must engage in regular stress testing of the reserve asset portfolio in order to confirm that the portfolio of reserve assets will continue to equal or exceed outstanding issuance value in stressed conditions, including in significant positive interest rate scenarios. The OCC is also adding new § 15.13(a)(10) which addresses the risk management of foreign exchange risk. The proposal asked whether the OCC should explicitly provide that managing foreign exchange risk is a permissible activity for the issuers of stablecoins that are not denominated in the United States dollar and whether to include limitations relating to the management of foreign exchange risk. Commenters generally favored permitting foreign exchange risk management as a permitted activity. Commenters noted that permitting foreign exchange risk management would reduce risk. Some commenters emphasized that the final rule should not permit speculation. Consistent with this feedback, the final rule requires foreign exchange risk management for issuers that issue payment stablecoins that are denominated in monetary value other than the 112 Permitted payment stablecoin issuers should consider the makeup of their reserve asset portfolio in light of their respective business models. For certain issuers it may be appropriate to hold reserves comprising money to standing to the credit of an account with a Federal Reserve Bank, funds held as demand deposits, or funds in share accounts that are payable on demand beyond the amount required under § 15.11(c)(2).

United States dollar, subject to certain conditions designed to ensure that the foreign exchange risk is appropriately hedged and that the permitted payment stablecoin issuer does not use its foreign exchange risk management program as a means of engaging in impermissible speculation. Under the final rule, a permitted payment stablecoin issuer that issues a payment stablecoin denominated in monetary value other than the United States dollar must hedge any residual foreign exchange risk identified pursuant to the monetization and stress testing requirements of § 15.13(a)(9) in accordance with § 15.13(a)(10). Section 15.13(a)(10)(ii) states that the permitted payment stablecoin issuer: (A) may not take anticipatory positions or maintain residual positions in the instruments used to hedge the permitted payment stablecoin issuer’s foreign exchange risk, except as necessary for the orderly establishment or unwinding of a hedging position; (B) must hedge to retain no more than minimal foreign exchange risk; (C) must not use foreign exchange risk management as a means to speculate, including with respect to the appreciation or depreciation of any national currency; and (D) must have in place policies and procedures that appropriately manage its foreign exchange risk and any attendant risks, including risks relating to the posting or collection of margin, foreign exchange counterparties, and basis risk. The policies and procedures must include adherence to the below-described § 15.13(a)(10)(iii) and (iv). Under § 15.13(a)(10)(iii), before a permitted payment stablecoin issuer engages in foreign exchange risk management, it must provide prior notice to the OCC through its supervisory office and receive the OCC’s approval. Additionally, under § 15.13(a)(10)(iv), the permitted payment stablecoin issuer must adhere to any limit or other condition to the OCC’s approval under § 15.13(a)(10)(iii). Such limits or conditions are likely to concern how the permitted payment stablecoin issuer remains both capable of meeting redemption requests in a timely manner and fully reserved.

Notably, while a permitted payment stablecoin issuer that issues a non-dollar￾denominated payment stablecoin must engage in foreign exchange risk management under the final rule, foreign exchange derivatives are not permitted reserve assets under section 4(a)(1)(A) of the GENIUS Act (12 U.S.C. 5903(a)(1)(A)). Accordingly, the fair value of foreign exchange derivatives used to hedge a permitted payment stablecoin issuer’s foreign exchange risk is not included in the reserve asset value of the permitted payment stablecoin issuer, and a permitted payment stablecoin issuer may need to hold a buffer to ensure that its non-dollar-denominated payment stablecoins remain properly reserved. Such derivatives may, however, be relevant to the permitted payment stablecoin issuer’s liquidity risk management and ability to timely redeem payment stablecoins. A permitted payment stablecoin issuer that issues a non-dollar￾denominated stablecoin should consider and address the effectiveness of its hedging instruments and how such instruments may behave in times of stress. For example, the need to rapidly unwind and reapply hedges in times of stress may limit the effectiveness of the permitted payment stablecoin issuer’s hedging strategy. Accordingly, permitted payment stablecoin issuers should carefully consider their ability to manage foreign exchange risk before issuing a non￾dollar-denominated payment stablecoin. Likewise, the OCC expects it would closely review such activities, both as proposed and on an ongoing basis. Proposed § 15.13(b) addressed risk management requirements relating to information technology and security. Several commenters suggested addressing risk management expectations for specific technologies, such as smart contracts or super intelligence. For example, a few commenters suggested requiring smart contract controls governing activities such as minting, burning, and freezing. Other commenters suggested establishing specific requirements governing the use of super intelligence, given that, as the commenters noted, its use

may become commonplace among permitted payment stablecoin issuers in their compliance programs. The final rule includes a reference to smart contracts but does not impose detailed requirements with respect to particular technologies. This level of detail is consistent with the GENIUS Act and the principles-based and technology-neutral approach that 12 CFR part 15 is taking toward risk management. Proposed § 15.13(b)(1) provided that a permitted payment stablecoin issuer must implement a comprehensive written information security risk and control framework, including a program that assesses and manages information technology and information security risks. The OCC is finalizing § 15.13(b)(1) as proposed. Under proposed § 15.13(b)(2), the board of directors of the permitted payment stablecoin issuer, or an appropriate board committee, would have been required to approve the information technology and security program described in paragraph (b)(1). The board would have been required to oversee the development, implementation, and maintenance of the program, including the appointment of a qualified Information Technology and Security Officer. The oversight required of the board or committee would have included assigning specific responsibility for program implementation and review of program-related reports. A few commenters supported requiring a permitted payment stablecoin issuer to have a Chief Risk Officer or Chief Audit Executive in addition to the Information Technology and Security Officer. Some commenters suggested that it is more important for the rule to require permitted payment stablecoin issuers to have officers and employees with the responsibilities of certain roles, such as a Chief Risk Officer, rather than requiring a specific officer or role. A few commenters suggested requiring a Chief Risk Officer with explicit responsibilities distinct from the Information Technology and Security Officer, for example, requiring a Chief Risk Officer

with explicit responsibility for protocol-level exposure above a materiality threshold. Another commenter suggested that a subsidiary permitted payment stablecoin issuer should be able to satisfy any requirement for a Chief Risk Officer if the subsidiary’s parent has a Chief Risk Officer. Another commenter suggested that a tailored approach to requiring a Chief Risk Officer or Chief Audit Executive ought to be adopted, where the requirements should be proportionate to the size and complexity of the issuer and consistent with standards applicable to comparable financial institutions. The OCC is adopting § 15.13(b)(2) with a modification to refer to “a qualified individual responsible for the program” and deleting the reference to an “Information Technology and Security Officer.” The OCC agrees with some commenters that it is more important for a permitted payment stablecoin issuer to have qualified individuals with the relevant responsibilities for overseeing the information technology and security program rather than to prescribe certain required titles or role names. The OCC is not requiring permitted payment stablecoin issuers to have additional named roles at this time. Permitted payment stablecoin issuers should generally create organizational roles to appropriately manage their operations. As discussed above, a permitted payment stablecoin issuer that is a subsidiary of an insured depository institution may rely on the parent’s risk management framework, including certain shared employees, provided that the parent’s risk management framework addresses the requirements of part 15 and the management of the permitted payment stablecoin issuer plays a meaningful role in the risk management framework related to the permitted payment stablecoin issuer’s activities. Under proposed § 15.13(b)(3), a permitted payment stablecoin issuer’s information technology and security program would have needed to include (i) an inventory and

classification of assets, processes, and sensitivity of data; (ii) controls supporting and safeguarding sensitive information and processes; (iii) evaluation, validation, and reporting processes to ensure that key information technology systems and controls, including smart contracts, are operating as intended; (iv) periodic independent testing; and (v) a comprehensive and effective incident identification and assessment process and incident response program. Several commenters suggested various specific information security requirements that, they argued, would be broadly appropriate for payment stablecoin issuers. These commenters’ descriptions indicate that these reflect the current and latest standards given the existing operational models and technology related to payment stablecoins. The OCC is adopting § 15.13(b)(3) as proposed. The OCC believes that the requirements of § 15.13(b)(3) are appropriately principles-based and technology-neutral. This approach will help ensure that the requirements remain relevant as relevant technology and best practices continue to develop. Under proposed § 15.13(b)(4), a permitted payment stablecoin issuer’s information technology and security program would have had to include administrative, technical, and physical safeguards designed to (i) ensure the security and confidentiality of records containing nonpublic personal information about a customer; (ii) protect against any anticipated threats or hazards to the security or integrity of such records; (iii) protect against unauthorized access to or use of such records that could result in substantial harm or inconvenience to any customer; and (iv) ensure the proper disposal of such records. A few commenters suggested requiring permitted payment stablecoin issuers to adopt privacy-preserving technologies to limit public disclosure of information. Some commenters suggested that demonstrating adoption of privacy-enhancing technologies should be sufficient to show compliance with risk management information security requirements. The OCC is not

mandating the use of any particular privacy-enhancing technology in the final rule, consistent with the OCC’s technology-neutral and principles-based approach to § 15.13. Permitted payment stablecoin issuers must ensure that their activities comply with § 15.13(b) and applicable BSA/AML-related requirements. Whether a particular privacy-enhancing architecture can comply with both provisions will depend on the facts of that particular architecture. Accordingly, the OCC is not commenting generally on whether a particular architecture is permitted or prohibited. Because § 15.13 must be principles-based and technology-neutral, as described above, the OCC believes that imposing requirements surrounding privacy-enhancing technology would be inappropriate. The OCC notes that § 15.13(b) does include requirements concerning the security of customer information, including developing an information technology and security program, ensuring the security and confidentiality of records containing nonpublic personal information about a customer, protecting against any anticipated threats or hazards to the security or integrity of records that could result in harm or inconvenience to any customer, and ensuring the proper disposal of such records. The OCC is adopting paragraph (b)(4) with one clarifying change. The final rule includes a reference to sensitive customer information, in addition to nonpublic personal information. Sensitive customer information will generally be a subset of nonpublic personal information. The final rule clarifies that, to the extent there is sensitive customer information that is not nonpublic personal information, the permitted payment stablecoin issuer must nonetheless take appropriate steps to ensure the security and confidentiality of such information. Proposed § 15.13(b)(5) provided that a permitted payment stablecoin issuer must develop, implement, and maintain appropriate measures to ensure secure handling of digital

assets, including private key management, backup, and recovery, incorporating: (i) relevant technical, operational, strategic, market, legal, and compliance considerations relating to each digital asset and its underlying ledger; and (ii) material developments specifically related to supported digital assets and their underlying ledgers. 113 A commenter described key backup and recovery procedures with continuity exercises as one facet of a broader risk management framework. Another commenter suggested that the rule emphasize robust practices for change management alongside other management tools like pre￾implementation testing. A separate commenter asked for additional guidance on change management and information security in general. The OCC is adopting § 15.13(b)(5) as proposed. The OCC believes that the requirements of the final rule are appropriately principles￾based and technology-neutral. This approach will help ensure that the requirements remain relevant as relevant technology and best practices continue to develop. The OCC anticipates issuing additional guidance concerning various provisions of the GENIUS Act and will consider what additional guidance concerning change management and information security may be appropriate. Proposed § 15.13(b)(6) would have required that a permitted payment stablecoin issuer monitor, evaluate, and adjust, as appropriate, its information technology and security program in light of any relevant changes in technology, the sensitivity of its customer information, internal or external threats, and the permitted payment stablecoin issuer’s own changing business 113 If a permitted payment stablecoin issuer holds digital assets on a customer’s behalf, the permitted payment stablecoin issuer’s risk management practices must reflect this activity. Consistent with the July 14, 2025 Joint Statement on Risk-Management Considerations for Crypto-Asset Safekeeping, a permitted payment stablecoin issuer holding digital assets on a customer’s behalf would be required to maintain risk management practices, and information security practices in particular, that reflect the permitted payment stablecoin issuer’s capacity to understand a complex and evolving asset class, ability to ensure a strong control environment, and appropriate contingency plans to address unanticipated challenges in effectively providing services to customers.

arrangements, such as mergers and acquisitions, alliances, joint ventures, third-party arrangements, and changes to applicable information systems. Some commenters recommended adopting a more prescriptive approach that would incorporate references to more specific types of technology and audits. Others stated that compliance with recognized industry security and risk management standards serves as evidence of compliance with § 15.13(b)(6). The OCC is adopting § 15.13(b)(6) as proposed with clarifying edits. Instead of the proposed language where § 15.13(b)(6) was titled “Adjust the program” and described the obligation to “monitor, evaluate, and adjust,” the final rule clarifies the requirement to both monitor and adjust through an edited title and a new structure: final § 15.13(b)(6)(i) focuses the proposed language on monitoring, and the new § 15.13(b)(6)(ii) addresses the need to evaluate and adjust the program in light of that monitoring. The OCC believes that the requirements of the final rule are appropriately principles-based and technology-neutral. Proposed § 15.13(b)(7)(i) would have required a permitted payment stablecoin issuer to conduct a reasonable investigation when it became aware of an incident of unauthorized access to sensitive customer information, including a customer’s private key, to determine the likelihood that the information had been or would be misused. If the permitted payment stablecoin issuer determined that misuse of customer information had occurred or was reasonably possible, the permitted payment stablecoin issuer would have needed to notify the customer or customers affected or possibly affected as well as the OCC as soon as possible. Customer notice must be delayed if an appropriate law enforcement agency determined that notification would interfere with a criminal investigation and provided the permitted payment stablecoin issuer with a written request for the delay. If delayed by investigation, the permitted payment stablecoin issuer would have needed to notify its customers of the misuse or possible

misuse of customer information as soon as law enforcement notified the permitted payment stablecoin issuer that notification would no longer interfere with the investigation. Proposed § 15.13(b)(7)(ii) recognized that there may be situations where the permitted payment stablecoin issuer determines that a group of files has been accessed improperly but is unable to identify which specific customers’ information has been accessed. If the circumstances of the unauthorized access led the permitted payment stablecoin issuer to determine that misuse of the information was reasonably possible, it would have needed to notify all customers in the group. Several commenters discussed the customer notification requirements. Some commenters suggested that due to the broad proposed definition of customer, the customer notification requirements were impractical. Some commenters also requested clarity as to the definition of “sensitive customer information.” Specifically, commenters requested clarification that GLBA data privacy protections apply by defining “sensitive customer information” or replacing that term with “nonpublic personal information.” The final rule, in § 15.2, narrows the definition of customer substantially. Accordingly, the OCC is adopting § 15.13(b)(7) with non-substantive adjustments. Specifically, the final rule replaces a reference to “a group of files” with “the files of a group of customers” for additional clarity. Additionally, the OCC is making clarifying edits, such as adding more precise wording to describe the actions of the relevant law enforcement agency. The OCC is also separating the proposed § 15.13(b)(7)(i) into final § 15.13(b)(7)(i)(A) through (C). Proposed § 15.13(b)(8) provided that a permitted payment stablecoin issuer’s information technology and security program must include measures to ensure continuity of operations and recover critical functions in the face of disruptions, including by business impact analyses, testing of vulnerabilities, and testing with critical service providers.

Some commenters stated that § 15.13(b)(8) should be modified to include specific additional items such as ongoing monitoring of critical service provider performance. The language of § 15.13(b)(8) is broad enough to include such monitoring to the extent necessary to ensure continuity of operations. The OCC is adopting § 15.13(b)(8) with two modifications. First, the final rule omits the phrase “in the face of disruptions” because the phrase was not necessary to include. Recent corporate information technology system failures have demonstrated the importance of measures to maintain operational resilience. Permitted payment stablecoin issuers should ensure that they have sufficient controls to reliably address operational issues that may arise with burning and minting new stablecoins and should conduct appropriate due diligence before supporting any new distributed ledger. Operational resilience will be particularly important for permitted payment stablecoin issuers, who will depend on customer confidence in the stable value and availability of their stablecoins. Second, the final rule changes “testing of vulnerabilities” to “testing for vulnerabilities” to clarify the purpose of the testing.
5. Audits, Reports, and Supervision (§ 15.14)
a. Overview of Changes from Proposed Rule to Final Rule for § 15.14 The OCC is adopting § 15.14 as proposed with certain modifications described below. The OCC is adopting § 15.14(a) through (c) as proposed. The OCC is revising paragraph (d) to shorten the length of the extended examination cycles to an “18- to 24-month period” from an “18- to 36-month period.” The OCC is further revising § 15.14(d)(3) by adding “, together with any affiliated permitted payment stablecoin issuers,” and removing “or less than $25 billion in total monthly trading volume.” The OCC is

making a technical change to the heading in paragraph (d), using the word “examination” instead of the word “exam.” The OCC is adopting the remainder of § 15.14(d) as proposed. The OCC is adopting § 15.14(e) through (i) as proposed except for separating proposed § 15.14(i) into § 15.14(i)(1) through (3) with minor technical edits. The OCC is revising § 15.14(j)(4) to limit the reporting requirement to “Federal qualified nonbank payment stablecoin issuers” by adding the following language to the beginning of the subparagraph, “In the case of a Federal qualified nonbank payment stablecoin issuer.” The OCC is adopting the remainder of § 15.14(j) as proposed. The OCC is revising § 15.14(k) by removing the reference to the board of directors in the first sentence, which would have required the board of directors to make all compliance certifications. Instead, the OCC is adding an additional sentence at the end of the paragraph, which provides that the initial certification must be provided by the permitted payment stablecoin issuer’s board of directors, whereas subsequent certifications may be provided by the issuer’s Bank Secrecy Act officer, board of directors, or an appropriate committee of the board of directors. The OCC is also revising § 15.14(k) to replace the phrase “defined in § 15.30” with “set forth in § 15.30.” Furthermore, the OCC is separating proposed § 15.14(k) into § 15.14(k)(1) and (2). The OCC is revising § 15.14(l) by replacing “$50 billion in outstanding issuance value” with “$50 billion in total consolidated outstanding issuance value” and making a clarifying edit. The OCC is also adding the phrase “rules and” before “auditing standards” in § 15.14(l)(1) and making a clarifying edit to § 15.14(l)(2)(ii). The OCC is renumbering paragraph (l)(2)(iii) as (l)(3) and renumbering the rest of paragraph (l)(3) appropriately. The OCC is adopting the remainder of § 15.14(l) as proposed.

The OCC is adopting § 15.14(m) through § 15.14(o) as proposed with clarifying edits in § 15.14(m)(1). b. Examinations
i. Description of the Proposed Rule
Section 6(a)(1) of the GENIUS Act (12 U.S.C. 5905(a)(1)) authorizes primary Federal
payment stablecoin regulators, including the OCC, to supervise permitted payment stablecoin issuers, as defined in the statute, that are not State qualified payment stablecoin issuers with an outstanding issuance of less than $10 billion in payment stablecoins. Section 6(a)(3) of the GENIUS Act (12 U.S.C. 5905(a)(3)) authorizes the OCC to examine permitted payment stablecoin issuers to assess the nature of their operations and the financial condition of the permitted payment stablecoin issuer; the financial, operational, technological, compliance, and other risks associated with the permitted payment stablecoin issuer that may pose a threat to the safety and soundness of the permitted payment stablecoin issuer or the stability of the financial system of the United States; and the systems of the permitted payment stablecoin issuer for monitoring and controlling the risks. Pursuant to section 6(a)(4)(C) of the GENIUS Act (12 U.S.C. 5905(a)(4)(C)), the OCC may only request examinations at a cadence and in a format that is similar to that required for similarly situated entities regulated by the OCC. Proposed § 15.14(a) provided that the OCC will conduct a full-scope examination of every permitted payment stablecoin issuer subject to its supervision at least once during each 12- month period, unless otherwise specified in proposed § 15.14(d). Consistent with the OCC’s statutory authority to supervise permitted payment stablecoin issuers, proposed § 15.14(d) would have provided the OCC with the option to examine some permitted payment stablecoin issuers on an 18- to 36-month cycle, as determined by the OCC, in its sole discretion, if the issuers satisfied the following conditions: (1) the permitted payment

stablecoin issuer currently is not subject to a formal enforcement proceeding or order; (2) no person acquired control, as specified in § 15.14(m), of the permitted payment stablecoin issuer during the preceding 12-month period in which a full-scope examination would have been required but for proposed § 15.14(d); (3) the permitted payment stablecoin issuer has an outstanding issuance value of less than $1 billion or less than $25 billion in total monthly trading volume; and (4) the permitted payment stablecoin issuer is in compliance with all of the reserve requirements set forth in proposed § 15.11 and the reporting requirements in proposed § 15.14. The proposed criteria for certain permitted payment stablecoin issuers to qualify for an 18- to 36- month examination cycle were similar to the factors the OCC considers for national banks and Federal savings associations under 12 CFR 4.6(b). Consistent with the OCC’s statutory authority under the GENIUS Act and the OCC’s supervisory authority over national banks and Federal savings associations, proposed § 15.14(e) would have allowed the OCC to conduct examinations of permitted payment stablecoin issuers as frequently as the agency deemed necessary, including examinations of a limited scope. 114 The OCC proposed this provision to ensure the agency had a clear mechanism, consistent with its statutory authority, to conduct ad hoc examinations when emergencies or risks to the safety and soundness of a permitted payment stablecoin issuer or the financial stability of the United States required the agency to deviate from its routine 12- or 18- to 36-month examination cycle. Proposed § 15.14(b) would have required that, upon request, permitted payment stablecoin issuers grant OCC examiners prompt and complete access to all officers, directors, employees, agents, and relevant books, records, or documents of any type. The OCC, through its examination authority over national banks and Federal savings associations, has authority to 114 See 12 U.S.C. 5905(a)(3).

access the officers, agents, and books and records of these institutions. 115 The books and records of a permitted payment stablecoin issuer include, but are not limited to, information retained on distributed ledgers. Sections 6(a)(1), (3), and (4) of the GENIUS Act (12 U.S.C. 5905(a)(1), (3), and (4)) give the OCC similar authority to supervise and examine permitted payment stablecoin issuers. Proposed § 15.14(b) would have applied the OCC’s examination authority to permitted payment stablecoin issuers in the same manner that it is applied to national banks and Federal savings associations. Additionally, proposed § 15.14(c) would have clarified that the OCC may conduct examinations either on site or remotely. Proposed § 15.14(f) would have provided that all permitted payment stablecoin issuers must maintain a complete set of books and records in English. Proposed § 15.14(g) would have required all permitted payment stablecoin issuers to develop and implement a records retention policy that ensured the permitted payment stablecoin issuer could demonstrate compliance with the GENIUS Act, this part, and all applicable laws and regulations.
ii. Description of Comments and Final Rule
Many commenters submitted general comments about the proposed examination framework and requested that the OCC modify or incorporate various concepts into the proposed examination framework. The OCC received several comments related to the imposition of uniform standards on permitted payment stablecoin issuers. Specifically, several commenters stated that banks operate in a highly regulated environment, and if permitted payment stablecoin issuers offer bank-like products, they should also be subject to the same supervisory expectations to which banks are subject. One commenter also stated that inconsistent standards or permitted payment stablecoin issuer-specific safe harbors risk creating perceived tiers of payment 115 12 U.S.C. 481 and 1464.

stablecoin quality. The commenter further added that keeping standards high and uniform protects the global “singleness” of U.S.-issued dollar stablecoins and urged the OCC to establish uniform examination, reporting, capital, and other prudential requirements. Another commenter claimed that nonbank stablecoin issuers present materially different supervisory considerations and argued that the OCC should apply more stringent, standalone audit, reporting, and transparency requirements to nonbank issuers to account for the absence of consolidated supervision, ongoing examination, and access to the Federal banking safety net. The commenter further argued that applying uniform requirements across bank and nonbank issuers would fail to recognize these differences and could place community banks at a competitive disadvantage despite their significantly higher level of existing regulatory oversight. After considering these comments, the OCC is finalizing § 15.14 as proposed with certain minor changes and clarifications. The overall framework continues to recognize the key differences between the business models of banks and permitted payment stablecoin issuers while ensuring that the OCC receives sufficient information from permitted payment stablecoin issuers to carry out its supervisory duties under the GENIUS Act. One commenter stated that, where a technology provider has been examined by another Federal regulator in connection with stablecoin services, the OCC should consider that examination work as part of its own independent evaluation. The commenter stated that this approach would reduce duplicative burden on community banks and their technology partners without compromising OCC supervisory authority. The OCC takes seriously its obligation to reduce duplication in supervision and regulation and has substantial experience coordinating with other regulators. The OCC will take appropriate steps to minimize duplicative efforts while

supervising permitted payment stablecoin issuers, and therefore it is not necessary to change the final rule in response to this comment. Another commenter stated that the supervisory framework for permitted payment stablecoin issuers should align, to the greatest extent possible, with existing supervisory and regulatory structures applicable to banking organizations and financial institutions. Where entities are already subject to comprehensive oversight with respect to capital, liquidity, operational resilience, and risk management, additional requirements should be designed to complement, rather than duplicate, those obligations. As required by statute, the OCC will pursue examination and supervisory policies that maximize efficiency and minimize duplication, including, where appropriate, coordinating examination activities and leveraging existing supervisory frameworks. 116 Another commenter stated that the compliance window is very short, that the statutory penalties starting in January 2027 will mount quickly, and that permitted payment stablecoin issuers are likely to fail as a result. The effective date is set by section 20 of the GENIUS Act (12 U.S.C. 5901 note (effective date)). The OCC will monitor permitted payment stablecoin issuers’ compliance with the GENIUS Act and part 15 and take enforcement actions as appropriate in light of the facts and circumstances of any particular violation. While the OCC recognizes that the time period between the issuance of this final rule and the effective date of the GENIUS Act is short, permitted payment stablecoin issuers should take seriously their obligations to comply with the provisions of the GENIUS Act as they become effective. Moreover, as discussed in more detail below, prospective permitted payment stablecoin issuers 116 See 12 U.S.C. 5905(a)(4)(B).