A prominent lobbying group representing United States banks has raised serious concerns regarding the Office of the Comptroller of the Currency’s recently finalized regulations concerning payment stablecoin issuance and custody. According to the American Bankers Association, the regulator’s final interpretation of the law diverges significantly from the original intent of Congress, opening potential regulatory loopholes that could disrupt the broader financial landscape.
In a notice published on Wednesday, the ABA stated that while the OCC’s final rules implementing the GENIUS Act incorporated several positive steps for the financial sector, the banking organization remains deeply critical of provisions related to stablecoin yield. The regulatory controversy stems from the OCC’s decision to drop a specific provision that would have established a legal presumption that certain third-party arrangements violate the statutory ban on yield payments for payment stablecoins.
The final rule removes the OCC’s originally proposed safeguards that would have addressed indirect arrangements involving affiliates, digital asset exchanges, and other distribution partners, the ABA noted in its official statement. As a result, the group argues, payment stablecoin issuers can effectively provide economically equivalent yield while technically skirting the statutory prohibition. Furthermore, the regulator declined to adopt a broader presumption against commercial arrangements explicitly designed to circumvent the legislative ban.
Those regulatory gaps risk undermining the clear distinction Congress drew between payment stablecoins and traditional bank deposits, the banking group warned. In the view of traditional financial institutions, this blurring of lines threatens the core pool of deposits that commercial banks rely upon to extend the loans that drive the domestic economy forward.
The question of stablecoin rewards and yield generation has remained one of the most contentious issues among federal lawmakers, regulators, and financial industry interest groups. The debate was fierce both before and after the GENIUS Act successfully passed through Congress in July 2025. This ongoing friction continues to generate intense scrutiny as policymakers grapple with broader digital asset legislation, such as the Digital Asset Market Clarity Act. That crypto market structure bill is currently stalled in limbo following a failed procedural vote in the United States Senate last month.
Reactions across the financial and digital asset sectors have been sharply divided. While traditional banking advocates view the regulatory changes with alarm, representatives of the crypto industry hold a fundamentally different perspective. Notably, the Blockchain Association publicly approved of the OCC’s decision to alter the yield prohibition, arguing that the adjustment successfully brought the final rule more closely in line with the actual statutory text enacted by lawmakers.
Meanwhile, other traditional banking advocacy organizations have echoed the ABA’s warnings. The Bank Policy Institute largely sided with the ABA, issuing a statement asserting that the regulatory decision to omit the proposed yield presumption replaces essential clarity with dangerous ambiguity. According to the institute, this regulatory shift puts the traditional banking system and its retail and commercial customers at direct risk of rapid deposit flight.
The OCC finalized its overarching regulatory framework ahead of the official implementation of the GENIUS Act, which is scheduled to take effect in January 2027. As the countdown to implementation continues, financial markets and industry stakeholders anticipate that other key government departments will soon release their own complementary rules regarding the GENIUS Act, particularly agencies holding direct regulatory purview over stablecoins, such as the Federal Reserve and the United States Department of the Treasury.
