OCC Urges Community Banks to Issue Payment Stablecoins, Citing GENIUS Ecosystem
The Office of the Comptroller of the Currency (OCC) has encouraged community banks to explore issuing payment stablecoins, in line with the recently finalized rules for the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act. This announcement comes as the OCC prepares to enforce the stablecoin law starting in January.
"Interested community banks are encouraged to consider applying to become, or for a subsidiary to become, a permitted payment stablecoin issuer," the US banking regulator stated in a recent X post.
The move is significant as it could potentially challenge the dominance of crypto companies and financial institutions in the stablecoin market. Community banks, if they enter the stablecoin market en masse, could offer a competitive alternative.
This plea from the OCC comes amid growing debate over the regulator's proposed rules on stablecoin yield, with some banking advocacy groups contending that they contradict the congressional intent behind GENIUS.
Currently, community banks are also engaged in legal action against the OCC, protesting against the approval of charter applications from crypto companies. The Independent Community Bankers of America, for instance, filed a lawsuit arguing that crypto companies have an unfair advantage over community bankers since they are exempt from the same regulatory requirements.
Related:
- Ex-Trump crypto adviser profited after helping pass stablecoin bill: WSJ
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Banks, Stablecoin, United States, Genius Act, Regulation