OCC Final GENIUS Act Rule: Reserves and Keys

On Wednesday, 21 October, the US Office of the Comptroller of the Currency (OCC) announced a final rule implementing the GENIUS Act, the 2025 federal law on payment stablecoins. CoinDesk describes the OCC as the first of several federal agencies to finish its GENIUS Act regulations. The rule and the Act take effect on 18 January 2027. We read the release, the bulletin and the rule document, focusing on reserves, redemption and custody.

Who it covers#

According to OCC Bulletin 2026-50, the rule applies to national banks, federal savings associations, federal branches and their subsidiaries, foreign payment stablecoin issuers, nonbank firms seeking or holding federal qualified issuer status, and state qualified issuers where the OCC has authority. It also covers certain custody activities of OCC-supervised entities. Most of it sits in a new 12 CFR Part 15. Bank Secrecy Act, anti-money laundering and sanctions requirements are left to a separate rulemaking with the Treasury.

Reserves and redemption#

As Cointelegraph summarises, issuers must hold reserves worth at least as much as their outstanding stablecoins. The rule text adds that timely redemption may not exceed two business days, and that reserve assets must be identifiable, segregated and not commingled with other assets.

The more technical changes concern liquidity. At least 5% of reserve assets must be held as demand deposits, funds payable on demand or balances at a Federal Reserve Bank. The proposal's Option B, which the OCC built on, had set this at 10%. The OCC says it lowered the figure in light of other requirements, including new stress-testing provisions. Exposure to any single counterparty is capped at 40% of reserve assets; exposures to the US government, to an appropriate custodian holding the reserves, and from centrally cleared repo are excluded. If redemption requests exceed 10% of a stablecoin's outstanding issuance in a single 24-hour period, the issuer must notify the OCC within 24 hours and may ask for more time to redeem. The OCC calls this a "principles-based approach" to diversification and concentration, supplemented by those two quantitative limits.

Custody and the definition of a key#

For readers who work with keys, two passages stand out. The proposal defined a private key as "the unique alphanumeric string" that allows a transfer. Commenters said this implied a single-key architecture and did not fit designs in which key shares are distributed so that the full key is never held in one place. The final rule defines a private key as "the cryptographic material, whether held in whole, in shares, or reconstructed ephemerally, that confers the ability to authorize a transaction on a distributed ledger."

The custody provisions keep the proposed control test. A custodian maintains control if it can reasonably demonstrate that no other party, including the customer, can transfer the asset without its consent. The OCC notes this does not require the custodian to be able to move assets alone, which it says accommodates multi-signature and multiparty computation set-ups.

What remains open#

On yield, the OCC kept the statutory ban on issuers paying holders interest solely for holding, using or retaining a stablecoin. It dropped the proposed rebuttable presumption that certain affiliate and third-party arrangements break that ban, and says it will apply the statute to the facts and circumstances of each arrangement. Rewards programs that predate the Act get no presumption of compliance.

Several practical points are still pending. The OCC will announce separately when it starts accepting issuer applications. The anti-money laundering and sanctions rules have yet to come. The Treasury, the Federal Reserve and the FDIC are still working on their own rules, and CoinDesk notes that not all of them are likely to be in place by January.

For now, the OCC rule gives the clearest picture yet of what a US payment stablecoin issuer under federal supervision will have to show: reserves it can document, redemptions it can meet within two business days, and keys whose control it can demonstrate. We will follow the remaining rulemakings as they are finalised.

Sources#

• OCC News Release 2026-92, 21 October 2026
• OCC Bulletin 2026-50, 21 October 2026
• OCC final rule (PDF)
• CoinDesk, Jesse Hamilton, 21 October 2026
• Cointelegraph, Robert Lakin, 21 October 2026

This article is for information only and is not legal or investment advice.