Source Document: [[OCC NPRM.pdf]] **Office of the Comptroller of the Currency | Federal Register Vol. 91, No. 40** **Published:** March 2, 2026 | **Comment Deadline:** May 1, 2026 | **Docket:** OCC-2025-0372 --- ## Executive Summary The Office of the Comptroller of the Currency (OCC) has published a Notice of Proposed Rulemaking (NPRM) to implement the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act, 12 U.S.C. 5901 et seq.), signed into law on July 18, 2025. The proposed regulations establish the operational framework governing payment stablecoin issuance by entities within OCC jurisdiction, including reserve requirements, redemption obligations, capital standards, risk management, and custody requirements. The rulemaking is directly relevant to the Commission's work. The GENIUS Act creates a federal floor for stablecoin regulation while expressly preserving substantial state authority, including a distinct pathway for state-issued tokens and a state-qualified issuer regime that operates independently of OCC oversight below a $10 billion issuance threshold. --- ## Background ### The GENIUS Act Framework The GENIUS Act establishes the first comprehensive federal regulatory framework for payment stablecoins. It prohibits any entity from issuing a payment stablecoin in the United States unless it qualifies as a "permitted payment stablecoin issuer" under one of the Act's recognized categories. The Act delegates authority to primary federal regulators — principally the OCC — to issue implementing regulations. The GENIUS Act's effective date is the earlier of 18 months after enactment (January 17, 2027) or 120 days after final regulations are issued by primary federal regulators. The OCC's rulemaking timeline therefore has direct consequences for when the federal framework becomes operative. ### Scope of This Rulemaking This NPRM addresses entities within OCC jurisdiction only. It does not govern all stablecoin issuers in the United States. Parallel rulemakings are underway at the FDIC (NPRM published December 19, 2025) and are expected from the Federal Reserve. The full federal framework will require synthesis across all three rulemakings. --- ## Statutory Issuer Categories The GENIUS Act creates three primary pathways for permitted payment stablecoin issuers relevant to this rulemaking: |Category|Description|Primary Regulator| |---|---|---| |Federal Qualified Issuer|Nonbank entities approved by OCC; uninsured national banks; Federal branches|OCC exclusively| |State Qualified Issuer|Entities licensed under a qualifying state regime|State regulator (OCC oversight activates above $10B)| |Subsidiary of Insured Depository Institution|Separate entity chartered by a national bank or federal savings association|OCC| A fourth category — **state-issued tokens** (e.g., Wyoming's Frontier Token) — occupies a distinct statutory space not governed by the OCC's permitted issuer framework. These are addressed separately under the Act and are the most insulated from federal OCC oversight. --- ## Key Proposed Requirements ### 1. Reserve Asset Standards (Proposed §15.11) The cornerstone of the proposed rule is a 100% reserve requirement. Every payment stablecoin in circulation must be backed at all times by a corresponding dollar of qualifying reserve assets. **Qualifying reserve assets include:** - U.S. dollars held at insured depository institutions or Federal Reserve Banks - Short-duration U.S. Treasury securities - Central bank reserve deposits - Repurchase agreements fully collateralized by Treasuries or central bank deposits **Expressly prohibited as reserve assets:** - Cryptocurrencies or other digital assets - Equities or corporate debt - Non-Treasury government securities of longer duration - Crypto assets held to pay transaction fees on distributed ledgers (permitted operationally but not as reserves) Reserve assets must be identifiable, segregated from the issuer's own operating assets, and not commingled with non-reserve holdings at any time. Issuers must publish a monthly attestation of reserve composition, verified by an independent qualified public accountant. Concentration limits are proposed to prevent over-reliance on any single custodian or asset class. The OCC is soliciting comment on the appropriate thresholds. ### 2. Redemption Requirements (Proposed §15.12) Issuers must honor redemption requests — the exchange of stablecoins for the underlying monetary value — within a defined and publicly disclosed timeframe. Key provisions: - Issuers must publish and maintain a written redemption policy accessible to customers - The policy must disclose the standard redemption window, circumstances under which it may be extended, and step-by-step instructions for redemption - If redemption requests in any 24-hour period exceed **10% of total outstanding issuance**, the issuer must notify the OCC within 24 hours — an early-warning mechanism for liquidity stress - The OCC retains discretionary authority to extend the redemption window if an issuer poses a threat to safety, soundness, or financial stability ### 3. Risk Management Standards (Proposed §15.13) The proposed rule adopts a principles-based approach to operational risk management, explicitly scaled to the nature, size, and complexity of the issuer. Requirements are adapted from existing OCC standards in 12 CFR Part 30, Appendices A and B. Required programs include: - **Internal controls:** Segregation of duties, clear lines of authority, compliance monitoring - **Cybersecurity:** Controls appropriate to the issuer's risk profile and technology stack - **Business continuity:** Documented plans for operational disruptions, including distributed ledger failures - **Third-party risk:** Oversight of service providers with contractual risk controls - **AML/BSA compliance:** Full Bank Secrecy Act obligations, including customer identification and suspicious activity reporting ### 4. Capital Requirements (Proposed §15.40–15.41) In addition to reserves, issuers must maintain a capital buffer to absorb unexpected operational losses. The proposed framework mirrors bank capital structure: - Minimum capital must consist of Common Equity Tier 1 (CET1) and Additional Tier 1 (AT1) components - CET1 instruments must have no maturity date, be redeemable only with OCC approval, and contain no features creating incentives for redemption - The OCC may impose individual capital add-ons above the standard minimum for issuers presenting elevated risk - Issuers subject to add-ons must submit an acceptable capital plan within a timeframe specified by the OCC ### 5. Custody of Reserve Assets (Proposed Subpart C) Only "eligible financial institutions" may hold reserve assets on behalf of permitted payment stablecoin issuers. To qualify, a custodian must: - Be subject to supervision by a federal primary financial regulatory agency, a state bank supervisor, or a state credit union supervisor (or be a Federal Reserve Bank) - Comply with Section 10(b), (c), and (d) of the GENIUS Act governing safe custodial practices - Enter into a formal custody agreement with the issuer documenting compliance and applicable policies Covered custodians must maintain possession or control of covered assets, including control of associated private keys for digitally held assets. Omnibus accounts are permitted subject to appropriate safeguards and record-keeping. ### 6. Application and Registration Processes (Proposed Subpart D) The rulemaking establishes distinct application pathways: - **Subsidiaries of insured depositories** seeking to issue stablecoins must apply to the OCC - **Nonbank entities and uninsured national banks** seeking Federal Qualified status must apply - **Foreign payment stablecoin issuers** must register with the OCC and demonstrate they are subject to a comparable regulatory regime in their home jurisdiction Applications must include organizational details, executive officer disclosures, proposed risk management programs, and reserve management plans. --- ## Federal Preemption and State Authority The GENIUS Act's preemption provisions are carefully bounded and are of direct relevance to the Commission. ### What Is Preempted - State charter, license, and authorization requirements for **Federal Qualified issuers** are preempted under Section 5(h) of the Act (12 U.S.C. 5904(h)) - The OCC has exclusive visitorial authority over Federal Qualified issuers and subsidiaries of OCC-regulated insured depositories - Certain state laws inconsistent with the OCC's exclusive oversight of Federal Qualified issuers are preempted ### What Is Preserved - **State consumer protection laws** are expressly preserved under Section 7(f)(4) of the Act (12 U.S.C. 5906(f)(4)) - **State-qualified issuer regimes** are fully preserved; states may license and regulate their own stablecoin issuers - **State-issued tokens** operate in a distinct statutory category outside the OCC's permitted issuer framework - OCC preemption does not extend to State Qualified issuers below the $10 billion threshold ### The $10 Billion Threshold State Qualified issuers with outstanding issuance below $10 billion remain under the exclusive oversight of their state regulator. Above $10 billion, the OCC's regulatory and enforcement authority activates. This threshold is a critical design parameter for any New Hampshire regulatory framework. --- ## Interstate Compact Provisions The GENIUS Act contemplates interstate agreements as a mechanism for states to collaborate on stablecoin regulation and token distribution. Wyoming's presentation to the Commission referenced this pathway, including the potential for states to operate as Distributed Verifier Nodes (DVNs) in stablecoin infrastructure. The OCC's proposed rule does not address interstate compacts in detail, but the Commission should monitor for guidance from Treasury and other federal agencies on how such arrangements will be treated under the federal framework. --- ## Parallel Federal Rulemakings This NPRM is one component of a multi-agency implementation process. The Commission should track the following: |Agency|Action|Date| |---|---|---| |Treasury|Advance NPRM on GENIUS Act|September 19, 2025| |FDIC|NPRM on application provisions|December 19, 2025| |OCC|This NPRM|March 2, 2026| |Federal Reserve|Rulemaking expected|TBD| Final rules from all agencies must be issued before the GENIUS Act's effective date. The interplay between these rulemakings — particularly for entities supervised by multiple regulators — will require careful analysis as final rules emerge. --- ## Selected Open Questions for Public Comment The OCC poses over 70 specific questions in the NPRM. The following are of particular relevance to the Commission's work: - Should permissioned or semi-permissioned blockchains qualify as "public" distributed ledgers for purposes of the rule? - Is the $10 billion threshold for OCC oversight of State Qualified issuers appropriately calibrated? - How should overlapping requirements between OCC and state regulators be managed for issuers subject to dual jurisdiction? - Should money market fund shares be permitted as reserve assets? - How should concentration limits be structured for reserve asset custodians? - Are the proposed redemption timeframes appropriate for the operational realities of stablecoin issuance? --- ## Implications for New Hampshire ### Preserved State Authority The GENIUS Act's architecture confirms that New Hampshire retains meaningful legislative space. A state-qualified issuer regime, or a state-issued token authority modeled on Wyoming's approach, would not require OCC approval and would operate under NH law below the $10 billion threshold. ### Wyoming Model Alignment Wyoming's Frontier Token program, presented to the Commission at the October 15, 2025 meeting, is structured as a state-issued token and therefore occupies the statutory category most insulated from OCC oversight. New Hampshire legislation following this model would similarly avoid the federal qualified issuer pathway and its associated OCC requirements. ### Comment Opportunity The May 1, 2026 comment deadline presents an opportunity for the Commission to file a formal comment addressing: (1) the importance of preserving robust state authority; (2) the appropriate design of the $10 billion threshold; (3) treatment of state-issued tokens relative to the OCC's permitted issuer framework; and (4) interstate compact provisions. A Commission comment would establish a public record of New Hampshire's regulatory interests at a formative stage of federal rulemaking. ### Legislative Design Considerations Any NH stable token legislation should be drafted with the following federal parameters in mind: - Reserve requirements must meet or exceed the GENIUS Act's 100% floor - Consumer protection laws are preserved and should be addressed explicitly in NH legislation - Redemption rights and disclosure standards in NH law should be compatible with federal minimums - AML and BSA compliance obligations apply to all permitted issuers regardless of state or federal licensing pathway --- ## Key Dates |Date|Event| |---|---| |July 18, 2025|GENIUS Act enacted| |September 19, 2025|Treasury advance NPRM| |December 19, 2025|FDIC NPRM published| |March 2, 2026|OCC NPRM published| |**May 1, 2026**|**OCC comment deadline**| |January 17, 2027|Latest possible GENIUS Act effective date| --- _Prepared for the New Hampshire Stable Token Study Commission. Source: OCC Docket OCC-2025-0372, Federal Register Vol. 91, No. 40, March 2, 2026. Full text available at regulations.gov._