Today the OCC published its final GENIUS Act rules for stablecoins, substantially relaxing requirements in some critical areas compared to its February proposals. The rules come into force on January 18, 2027, but given the document runs to more than 700 pages, we’re only highlighting a few points here. While yield may attract the headlines, the surprise is the light touch on reserves, particularly maturity.
Stablecoins are known to have a moderately high run risk, so having sufficient reserves on hand for redemptions is critical. The OCC’s February proposal floated a 10% daily liquidity requirement, since cut to 5%. The potential 30% weekly liquidity requirement has gone entirely, as has the weighted average maturity cap of 20 days. In theory, a stablecoin issuer could hold 5% of reserves in daily liquidity and the balance in Treasuries out to 93 days, if the issuer assesses this as addressing liquidity risks. Issuers that mainly hold Treasuries could get additional liquidity through repo, assuming markets are functioning smoothly.
The concentration relaxations overlap with the maturity ones. For daily liquidity, the proposals capped exposure to a single institution at 50%. That’s gone. The proposals also included a broad 40% limit on exposure to any one institution. While the 40% has been retained, there are now numerous exclusions covering government exposures, centrally cleared repo, self-held assets and qualifying custodians. The rule makes explicit that an issuer can custody 100% of its own assets. That said, if it invests in Treasuries, third party involvement is practically unavoidable.
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