The Federal Deposit Insurance Corporation (FDIC) has issued its proposed rules for regulating stablecoin issuers. While the Office of the Comptroller of the Currency (OCC) is the regulator for national banks, the FDIC will oversee stablecoins issued by state chartered banks that have FDIC insurance but are not a member of the Federal Reserve.
The FDIC’s wording for the controversial area of stablecoin interest is almost identical to the OCC’s. The GENIUS Act banned issuers from paying interest directly. However, today you have PayPal, which is technically not the issuer of its PYUSD stablecoin, paying rewards. Additionally, Anchorage Digital which issues stablecoins on behalf of Tether and Ethena, created an affiliate to pay stablecoin rewards. The OCC and FDIC rules prohibit these pathways. It’s not entirely clear whether the Coinbase rewards would fall under the prohibitions. White label issuances are expressly covered. But so is “A person offering to pay interest or yield to payment stablecoin holders as a service”, which may cover Coinbase. The OCC says other arrangements not captured by its wording may still violate the statutory prohibition and will be assessed case by case.
Where the FDIC and OCC diverge quite substantially is on reserves, both the composition and diversification requirements.
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