The OCC’s GENIUS Act: A Symphony of Regulation for Stablecoins!

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The Office of the Comptroller of the Currency (OCC) has unveiled a federal regulatory framework for payment stablecoins under the GENIUS Act, a bureaucratic opus that promises to impose standards on issuance, reserves, supervision, and foreign issuers with the precision of a drunkard’s compass.

OCC Solicits Public Commentary on Its Grand Stablecoin Overlordship

Federal banking regulators, ever the diligent architects of confusion, have embarked on a noble quest to govern digital assets. On Feb. 25, the OCC issued a notice of proposed rulemaking-a document so dense it could double as a doorstop-to implement the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act. This masterpiece of legislation outlines standards for payment stablecoin issuance and related activities, all while ensuring no one actually understands what they just read.

Subject to the OCC’s regulatory or enforcement authority under section 4 or 7 of the GENIUS Act, the notice states:

“The OCC will have regulatory or enforcement authority over certain permitted payment stablecoin issuers, including subsidiaries of national banks or Federal savings associations, Federal qualified payment stablecoin issuers, and State qualified payment stablecoin issuers.”

It further notes, “In addition, the OCC will have regulatory authority over foreign payment stablecoin issuers.” One wonders if this includes extraterrestrial entities trading in cryptocurrency. The answer, likely, is a bureaucratic shrug.

The proposed rule would codify a new 12 CFR 15, a labyrinthine addition to the Code of Federal Regulations designed to govern payment stablecoin activities under the OCC’s supervision. This new section would establish standards for permissible activities (whatever that means), reserve assets (like gold, but probably not), redemption rights (a tango of liquidity and despair), risk management (a masquerade ball of compliance), audits (a circus of paperwork), reporting (a Sisyphean task), supervision (a watchful eye with a caffeine addiction), custody (a vault guarded by ants), applications and registrations (a bureaucratic maze), oversight of foreign issuers (a diplomatic dance), revocation or rescission of approval (a bureaucratic guillotine), and capital and operational backstops (a financial life raft for the confused).

Beyond this marvel of regulatory engineering, the proposal would update existing capital adequacy standards (a polite lie), prompt corrective action requirements (a bureaucratic slap on the wrist), fee assessment structures (a tax on confusion), and procedural rules (a bureaucratic riddle). The agency now requests public input, as if the common man might possess the wisdom to decode this. Meanwhile, Bank Secrecy Act, anti-money laundering, and Office of Foreign Assets Control sanctions obligations will be addressed separately-because why let one document solve all problems? The effective date? The earlier of 18 months after enactment or 120 days after the primary Federal payment stablecoin regulators issue final implementing regulations. A timeline as precise as a drunken clock.

FAQ 🧭

  • What does the OCC proposal mean for stablecoin issuers?
    Only permitted payment stablecoin issuers (including qualifying Federal and State issuers) meeting strict standards will be allowed to operate in the United States. Translation: Apply for a permit, pay a fee, and hope the bureaucrats don’t nap during your application review.
  • How could the GENIUS Act impact crypto markets?
    A clear federal framework may reduce regulatory uncertainty and attract institutional capital. Or it may bury the industry under a avalanche of paperwork. Only time-and a small fortune in legal fees-will tell.
  • Are foreign stablecoin issuers affected?
    Foreign payment stablecoin issuers would fall under OCC regulatory authority if operating in the U.S. One might assume this applies to Martian banks as well. No confirmation provided.
  • When could the new stablecoin rules take effect?
    The framework becomes effective within a defined window after regulators finalize implementing rules. A timeline as precise as a squirrel’s nest.

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2026-02-27 03:57