OCC leaves crypto platforms room to pay stablecoin rewards

The Office of the Comptroller of the Currency on Oct. 21 issued a final rule that keeps stablecoin issuers from paying holders interest while leaving trading platforms room to offer interest-like rewards, according to the Associated Press report. The distinction matters because rewards tied to stablecoins may continue even as federal rules set limits on what issuers can pay directly.

The mechanism has three parts. An issuer creates a stablecoin designed to hold a steady value, typically $1, and backs it with assets such as bank deposits and U.S. Treasuries. Those reserves can earn interest. The issuer cannot pass that interest directly to people holding its coins, but an exchange or other platform that trades and holds them may share earnings with customers as rewards. The OCC says its final rule implementing the GENIUS Act takes effect Jan. 18, 2027.

Who can pay rewards under the rule?

Crypto platforms may offer rewards on a case-by-case basis, the AP reported; the OCC rule does not impose the blanket ban on those programs that banking groups had sought. The difference is between the stablecoin issuer and the platform: one issues the token and holds reserve assets, while the other can offer a customer reward linked to those assets’ earnings.

Think of the reserve earnings as money collected in one place and shared through a separate arrangement. The analogy stops there: the platform reward is not the same as interest paid by a bank on a deposit, and the stablecoin itself is not a bank account.

What does the OCC rule cover?

The rule sets requirements for permitted payment stablecoin issuers under OCC jurisdiction, including standards for reserves, redemption, risk management, custody and supervision. The OCC says it received hundreds of comments on its proposal. Its final rule covers the GENIUS Act provisions the agency must implement, with anti-money-laundering and sanctions rules to come in a separate rulemaking.

The law’s framework applies to payment stablecoin issuance. The rewards question sits at the boundary between that issuance and services provided by crypto platforms. The OCC rule’s effective date is Jan. 18, 2027, so the new framework is not yet in force.

Why did banks oppose platform rewards?

Banking groups have argued that higher returns from crypto platforms could pull deposits from banks and reduce funds available for lending. The AP reported that Coinbase offered up to 3.5% on USDC balances, compared with a 0.38% average yield for traditional savings accounts in the latest Federal Deposit Insurance Corp. figures cited in the report.

The OCC’s decision leaves platforms able to compete with such rewards under the rule’s case-by-case approach. It does not let stablecoin issuers pay holders interest directly, and the agency’s final rule governs issuers and related activities within its jurisdiction.

Sources

• Associated Press report — apnews.com
• final rule implementing the GENIUS Act — occ.gov