OCC leaves stablecoin rewards to case-by-case review

The Office of the Comptroller of the Currency finalized rules for payment stablecoins on Oct. 21, leaving crypto exchanges able to offer interest-like rewards under case-by-case review. The rule implements the GENIUS Act, while keeping its ban on stablecoin issuers paying holders interest or yield.

A stablecoin is a crypto token designed to hold a steady value, often one U.S. dollar. Its reserves can include bank deposits and U.S. Treasury securities, which earn interest. The issuer holds the reserves; an exchange may hold the customer’s tokens and offer rewards tied to them. The OCC’s final rule announcement says the rule takes effect Jan. 18, 2027. The Associated Press reported that exchanges may pass some earnings from stablecoin holdings to customers, subject to the regulator’s case-by-case assessment.

Who can pay a stablecoin holder?

The GENIUS Act prohibits issuers from paying interest or yield to holders of their payment stablecoins. The restriction also reaches payments made through other parties when they are made solely because a person holds, uses or retains the token. The OCC’s rule sets out how it will apply that statutory language to particular arrangements.

That leaves a distinction between the issuer and an exchange. Circle issues USDC; Coinbase and Robinhood are examples of exchanges that trade or hold stablecoins. An issuer cannot simply pay a holder interest. An exchange’s reward program, however, is not categorically barred by the rule. It will be assessed against the law and its facts.

What will the OCC examine?

The OCC says it will assess each arrangement on its facts and circumstances. As CoinDesk reported on the final rule, the agency indicated that the word “solely” matters: a reward made at least partly for other reasons may fall outside the ban. The agency did not give a list of approved reward designs.

Existing programs get no automatic exemption. The OCC said programs that predated the GENIUS Act do not necessarily comply just because Congress knew about them. That means exchanges cannot treat a longstanding reward offer as a guaranteed safe harbor; the regulator will still review its structure.

When do the rules start, and what is at stake?

The OCC’s final rule takes effect Jan. 18, 2027, the same date the agency identifies for the GENIUS Act’s effective date. The rule applies to stablecoin issuers and other entities within OCC jurisdiction, including certain federally qualified issuers and foreign issuers.

The distinction matters because rewards can influence where customers keep dollars. Banks have warned that stablecoin programs could pull deposits from lenders, reducing funds available for loans. Crypto firms have argued for room to offer incentives. The final rule leaves that competition in place, but an exchange reward must fit the law’s limits and may face OCC scrutiny. Stablecoin rewards are not bank deposits, and the programs do not carry the same FDIC deposit insurance described by AP.

Sources and documents

• final rule announcement — occ.treas.gov
• CoinDesk reported on the final rule — coindesk.com