The Office of the Comptroller of the Currency (OCC) has officially approved the final rules for payment stablecoin issuance and custody under the GENIUS Act framework. However, the federal banking regulator’s move immediately drew pushback from the primary US banking lobby, the American Bankers Association (ABA). The ABA argued that the OCC’s interpretation undermines the original intent of the US Congress by removing protective provisions that limit yields for token holders.
At the core of the dispute is not merely an issue of administrative compliance, but a yield-sharing loophole now open to the digital asset industry.
Third Parties and Deposit Flight Concerns
In its final rule, the OCC eliminated a provision that previously established a legal presumption of violation regarding yield distributions through third parties. These intermediary channels include affiliates, crypto exchanges, and token distribution partners. The ABA emphasized that loosening this rule creates a loophole for stablecoin issuers to pass economic yields to token holders while circumventing the statutory prohibition.
Similar concerns were voiced by the Bank Policy Institute (BPI). Fully backing the ABA’s stance, the banking policy group warned that stripping the presumed ban on yields replaces legal certainty with ambiguity. The BPI warned that this lack of regulatory clarity poses a real risk of customer deposit flight from conventional banking to stablecoin products.
Crypto Industry Support and Stalled Senate Deliberations
An opposing view was voiced by crypto industry advocacy group Blockchain Association. The organization welcomed the OCC’s move, stating that the regulator’s final rule aligns implementation provisions more closely with the official statutory text. For crypto industry representatives, the OCC’s ruling delivers legal clarity in line with the legislative mandate without adding unwritten restrictions.
The dispute between banks and crypto players reignites regulatory friction in Washington. The debate over stablecoin incentives resurfaced after deliberations on the Digital Asset Market Clarity Act stalled in the US Senate last month. The legislative impasse over the digital asset market bill has shifted the regulatory battleground directly to federal banking watchdogs.
Awaiting Fed Guidance Ahead of 2027
The OCC’s final regulation was issued ahead of the GENIUS Act’s scheduled implementation in January 2027. While the OCC has clarified its position for institutions under its supervision, regulatory certainty at the national level remains incomplete. Other federal agencies, including the Federal Reserve and the US Department of the Treasury, are still drafting implementing regulations within their respective jurisdictions.
For depositors and asset owners in the United States, the dispute comes down to whether their money will remain in commercial bank accounts or shift to stablecoins offering interest-like returns. As long as the Fed and the Treasury have not published their official rules, the battle for customer deposits between banks and stablecoin issuers remains an open question.
Via Cointelegraph.
Previously: OCC Finalizes GENIUS Act Regulations - Full Reserve Requirement and Total Ban on Interest
Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
