OCC Finalizes Stablecoin Rules That Supervise Issuers Like Banks

Key Takeaways

• Stablecoin issuers will face ongoing OCC supervision, including full-scope examinations at least once every 12 months for most significant issuers, as well as confidential weekly reserve and activity reporting and quarterly financial reporting. 
• Reserve requirements provide issuers some additional flexibility while maintaining strict liquidity standards. The final rule lowers the minimum daily liquidity requirement from 10% in the proposal to 5%, but limits reserves to specified eligible assets and requires issuers to demonstrate that they can access and monetize those reserves under normal and adverse conditions.
• Issuers face significant operational and capital requirements beyond obtaining a license. The rule generally requires redemptions within two business days, establishes an ongoing $5 million minimum capital floor and requires an operational backstop equal to 12 months of total expenses.