OCC leaves crypto exchange stablecoin rewards open under GENIUS rule

The Office of the Comptroller of the Currency (OCC) has finalized rules for payment stablecoins that bar issuers from paying holders interest directly but leave some exchange reward programs possible. The distinction matters because a stablecoin issuer and a crypto exchange can play different roles in passing earnings to customers.

Under the GENIUS Act, stablecoins are digital tokens designed to keep a steady value, often around $1. Issuers back them with assets such as bank deposits and U.S. Treasuries. Those reserves can earn interest. As the Associated Press reported, exchanges that trade and hold stablecoins may pass earnings to customers as rewards. The OCC says the final rule takes effect Jan. 18, 2027.

How can an exchange reward differ from issuer interest?

The issuer creates the stablecoin and holds the assets backing it. The exchange holds or trades the token for customers. In the arrangement described by AP, the issuer’s reserves generate earnings, and an exchange may share earnings with customers through a reward program. That is the route that lets a customer receive a return even though the issuer cannot pay interest directly to the token holder.

The OCC has not given every such arrangement blanket approval. The agency said it will assess the facts and circumstances, including whether a payment is interest or yield made solely because someone holds, uses or retains a stablecoin. A payment that meets those conditions is prohibited by the law. The final rule leaves the treatment of particular arrangements to case-specific review.

What did the OCC’s rule change?

The OCC’s final rule notice implements the GENIUS Act for stablecoin issuers under the agency’s jurisdiction. It sets standards for reserves, redemptions, risk management, audits, custody and supervision. The OCC says the rule does not cover separate requirements for anti-money laundering, sanctions and the Bank Secrecy Act, which will come through another rulemaking.

The act was signed on July 18, 2025, and the rule takes effect Jan. 18, 2027. Until then, the key distinction is between direct issuer payments, which the law bars when tied solely to holding a stablecoin, and exchange rewards, which the OCC will assess based on how each program works.

Why are banks challenging the rewards?

Banks argue that crypto rewards could draw deposits away from accounts that banks use to fund loans. AP reported that Coinbase offered up to 3.5% on USDC balances, compared with a 0.38% average yield for traditional savings accounts, citing Federal Deposit Insurance Corp. figures. Those rates help explain the dispute: the same reserve earnings that support a stablecoin can become a competitive return for customers if an exchange shares them.

Sources and documents

• the Associated Press reported — apnews.com
• final rule notice — occ.gov