OCC leaves stablecoin rewards open to crypto exchanges

The Office of the Comptroller of the Currency’s new stablecoin rule keeps a route open for crypto exchanges to pay customers interest-like rewards, while barring stablecoin issuers from paying holders directly. The rule implements the GENIUS Act, and takes effect on January 18, 2027. The Associated Press report says exchanges can pass along earnings from stablecoin holdings as rewards on a case-by-case basis.

How can an exchange pay a reward if an issuer cannot?

A stablecoin issuer creates the coin and holds assets to back it. Those reserves can include bank deposits and U.S. Treasuries, which earn interest. An exchange, such as Coinbase or Robinhood, can trade and hold the coins for customers. The exchange may then pass along some earnings connected to those coins as a reward. The issuer and the exchange are separate parts of the chain: the issuer is barred from paying interest directly to holders, while the exchange’s rewards are assessed case by case under the OCC rule.

That distinction is the heart of the policy. The GENIUS Act, signed into law on July 18, 2025, restricts direct yield payments by permitted payment stablecoin issuers. The OCC’s final rule sets requirements for issuers under its jurisdiction, including standards for reserves, redemption, risk management, audits and supervision. It takes effect on the same date as the law.

What does “case by case” mean for platforms?

It means the rule does not give every exchange a blanket approval to pay rewards. The OCC will assess arrangements individually. The agency had proposed a presumption that certain issuer and third-party arrangements would count as the issuer paying yield indirectly. The final approach leaves exchanges able to offer some rewards, according to the AP, but the terms and structure of a particular program matter.

Think of it as a rule about who hands over the payment: the issuer cannot pay a holder just for keeping the coin, while an exchange may be able to share earnings through a separate arrangement. That separation does not settle every program’s status.

Why did banks object to the rewards?

Banking groups say crypto rewards could draw deposits away from banks, leaving them with less funding to make loans. The AP reported that Coinbase offered up to 3.5% on USDC balances, compared with a 0.38% average rate for traditional savings accounts, citing Federal Deposit Insurance Corp. figures. The American Bankers Association said the OCC decision threatens funds banks use for lending.

Consumer groups have raised a different concern: people may mistake exchange rewards for bank-account interest. Stablecoin holders do not get the equivalent of federal deposit insurance, the AP reported. The OCC’s final rule bulletin says the agency will regulate issuers and certain custody activities within its jurisdiction. It does not make exchange rewards identical to insured bank deposits.

Sources

• Associated Press report — apnews.com
• final rule bulletin — occ.gov