The Office of the Comptroller of the Currency proposed regulations in February implementing the GENIUS Act that set a minimum initial capital requirement of $5 million for newly approved federal payment stablecoin issuers, but the financial barrier extends beyond this headline figure. Published for comment on March 2, with the comment period closing on May 1, the proposal also requires new issuers to maintain enough liquid assets to cover 12 months of projected operating expenses during a de novo supervisory period lasting at least three years. The regulations establish a prudential regime that favors applicants with capital, liquidity, compliance staff and established financial infrastructure, as Congress created a federal pathway for regulated payment stablecoins through the GENIUS Act.
OCC Proposes $5 Million Minimum Capital During Three-Year De Novo Period
The proposed $5 million requirement applies as a minimum initial capital level during a de novo period of at least three years for newly approved federal qualified payment stablecoin issuers. The OCC could require more than $5 million depending on the applicant's business plan, risk profile, expected growth, technological complexity and projected losses. After the de novo period, capital would be set individually according to the issuer's activities, financial position and supervisory assessment.
The proposed rule would apply to national banks and their subsidiaries, federal savings associations and their subsidiaries, federal branches, foreign payment stablecoin issuers, non-bank entities seeking approval as federal qualified payment stablecoin issuers and certain state-regulated issuers falling under OCC authority. Most requirements would be placed in a new 12 CFR Part 15 covering permitted activities, reserve assets, redemption, custody, risk management, audits, reporting, supervision, applications, registrations and treatment of foreign issuers.
12-Month Operating Expense Requirement Creates Additional Financial Barrier
The proposal requires newly approved issuers to maintain liquid assets sufficient to cover at least 12 months of projected operating expenses. A company expecting to spend $2 million each month on employees, technology, cybersecurity, legal advice, compliance, audits, custody and infrastructure would need $24 million in liquid assets to satisfy this requirement. That amount would sit alongside regulatory capital and reserve assets backing stablecoins in circulation.
The OCC proposed weekly confidential and quarterly reporting forms for issuers, adding data, accounting and supervisory infrastructure requirements. Stablecoin issuers would need systems capable of monitoring reserves, processing redemptions, securing private keys, managing third parties, producing regulatory reports and maintaining operations during cyber incidents or market stress.
Large Banks Meet Capital Requirements Through Existing Infrastructure
Large banks already hold regulatory capital, operate compliance departments and maintain systems for sanctions screening, customer identification, liquidity management and supervisory reporting. State Street launched a money market fund designed for stablecoin reserves, while Fidelity introduced a reserve fund targeting issuers and institutional investors.
Sony entered the U.S. stablecoin market with conditional OCC approval to launch a trust bank. Traditional financial firms are positioning themselves around the regulated stablecoin market through custody, settlement, compliance and cash-management services.
Fintech Firms Face Higher Entry Costs Under Proposed Framework
De novo trust companies, payment startups and non-bank applicants face pressure as they must fund fixed costs before establishing meaningful circulation or reserve income. A fintech may raise $5 million while lacking additional resources required for one year of operating expenses, senior compliance personnel, independent governance, cybersecurity controls, audits and regulatory reporting.
The structure could encourage smaller companies to partner with banks or federally approved issuers rather than seek their own licenses. A fintech might provide wallets, payment applications, distribution or blockchain technology while relying on another institution to issue and redeem the stablecoin.
OCC Capital Proposal Forms One Component of Multi-Part GENIUS Act Implementation
The OCC's February proposal excluded Bank Secrecy Act, anti-money laundering and Office of Foreign Assets Control sanctions requirements because those areas were reserved for separate coordinated rulemaking. The capital, licensing and reserve proposal closed for comments on May 1. A separate customer-identification proposal remains open until August 21, while the OCC's dedicated AML, counter-terrorist financing and sanctions programme proposal followed a different timetable.
The FDIC published its own stablecoin reserve and risk-management proposal, while federal agencies separately advanced bank-style customer-identification requirements for stablecoin issuers. Regulators did not complete all final rules by the law's July 18 rulemaking deadline.
FAQ
What is the minimum capital requirement the OCC proposed for federal stablecoin issuers?
The OCC proposed a minimum initial capital requirement of $5 million for newly approved federal payment stablecoin issuers during a de novo supervisory period lasting at least three years. The regulator could require more than $5 million depending on the applicant's business plan, risk profile, expected growth, technological complexity and projected losses.
When did the OCC's stablecoin capital proposal comment period close?
The OCC published the proposed GENIUS Act regulations for comment on March 2, and the comment period closed on May 1. This deadline is separate from the August 21 deadline associated with a customer-identification rule, as the OCC is implementing the GENIUS Act through several rulemakings covering different requirements.
