OCC urges community banks to consider stablecoin issuance

The Office of the Comptroller of the Currency is urging community banks to consider applying to issue payment stablecoins, either directly or through subsidiaries, under the federal framework established by the GENIUS Act. The OCC said the invitation is intended to encourage development of stablecoin capabilities in the community banking sector. Its announcement follows the agency’s finalization of rules for issuers under the law, which sets standards for reserves, redemptions, custody and risk management. The rules take effect January 18, 2027. The OCC has not yet begun accepting issuer applications, and said the process will open after required federal paperwork approval. The invitation does not establish that any community bank has applied or decided to enter the market. Under the finalized framework, community banks may seek permission to issue payment stablecoins themselves or through a subsidiary. Existing issuers that submit substantially complete applications by January 18, 2027, may request temporary waivers to continue operating while their applications are reviewed. The OCC said it generally expects to grant waivers where appropriate. The GENIUS Act, enacted July...