OCC Receives Genius Act Rulemaking Responses From Industry

The OCC receives feedback on its Genius Act rulemaking.

Several respondents submitted letters to the OCC (Office of the Comptroller of the Currency) and its Genius Act regulatory proposals. Names such as Circle, Blackrock and A16z Crypto gave their views on the rulemaking provided in March. The official deadline for the window was 60 days and ended May 1st.

While the actual response isn't published, Circle's blog had summarized its overarching arguents for consideration in a blog with priorities outlined.

Emphasis is particularly places on narratives such as that the U.S. should continue its intended vision for payment stablecoins, stablecoin issuers (private and bank-based) must have conformity in rules and redemptions, as well as a clear distinction between stablecoins and tokenized deposits. This is a more broader approach to ensure the U.S. Genius Act stays on track.

Blackrock had published its letter to the OCC. The global investment and asset manager specifically writes to exlude GMMF (Government Money Market Funds) as reserve assets that are in self-custody by a stablecoin issuer, as well as ensure that same-day GMMFs are allowed to be counted as assets for weekly liquidity.

It had also mentioned extending and contributing to the type of studies that will be undertaken in the coming months, as well as adding other types of assets like ETFs as reserves. Also, it supports OCC's allowance for stablecoin issuers to have investment managers monitor asset reserves in separate accounts.

A16z Crypto, had also commented. The VC specifically made an effort to showcase that there should be better ways of allowing white-label stablecoin issuance for more than a single brand of stablecoins. It also supports for more studies on non-payment stablecoins as categorized by the Genius Act, notably on decentralized alternatives to support other existing stablecoin types.

On the other side, policy and banking associations had submitted their feedback to OCC's rulemaking proposals. The general concern raised as a group is regarding the need to raise capital requirements and oversight of stablecoin issuers to be in line with banking supervision.

BPI (Bank Policy Institute) had comments instructing the OCC to reconsider raising capital limits for underlying reserves, changing language to expressly prohibit stablecoin yield and parallel arrangements, as well ensuring that custodians of stablecoin issuers create separate books on their balance sheets.