US OCC will review stablecoin reward programs run through third parties on a case-by-case basis

The Office of the Comptroller of the Currency (OCC) is stepping back from an earlier “automatic violation” approach to stablecoin reward schemes. For issuers and PSPs, that matters because the new reading leaves room for rewards programs routed through third parties, while still putting the whole setup under scrutiny.

1. Under the GENIUS Act, stablecoin issuers cannot pay holders interest or yield just for holding their tokens. The loophole, of course, is that crypto platforms have been routing reward programs through affiliated entities or outside platforms. In its draft rules, the OCC had proposed treating those arrangements as automatic violations that could trigger loss of license. It now says each rewards structure will be assessed individually.
2. The OCC also plans to review every loyalty program that was launched before GENIUS took effect and decide whether it complies with the law. That gives existing programs no blanket grandfathering: they are in scope, and the regulator will decide case by case.
3. The new rules give stablecoin issuers more freedom over reserve assets. For companies that only issue tokens, reserves are required only against the stablecoins they have issued, on a “one token to one unit of fiat currency” basis.
4. The definition of a “customer” has also been clarified. A customer is someone who bought tokens directly from the issuer or asked the issuer to redeem them. A holder who bought stablecoins through another venue, such as an exchange, is not the issuer’s customer until that holder asks the issuer to redeem the tokens. As a result, the issuer is not liable for those tokens if the wallet is blocked, and it does not have to run KYC (know your customer) checks on that holder.
5. The OCC has also decided that wrapped stablecoins do not count as payment stablecoins, so they do not fall under GENIUS. That means those tokens do not need to show 1:1 fiat reserves, and the direct ban on issuer-paid yield does not apply to them. Separately, GENIUS requires a license to issue payment stablecoins in the US from 18 January 2027. Issuing tokens without authorization carries criminal liability. Issuers that already have an application pending on that date may request a waiver for up to one year, and the OCC says it expects to grant such waivers to companies that are already operating in the US and already have stablecoins in the market. The agency will announce the start date for applications separately.

There is also a broader regulatory backdrop here. After the CLARITY bill on crypto market oversight failed, the US Congress is looking at alternative ways to regulate banks’ work with digital assets, according to the Congressional Research Service (CRS). The CRS said lawmakers are concerned that the rules could change again if the presidential administration changes.