New OCC stablecoin rule resets redemptions, and banks face big shifts

The Office of the Comptroller of the Currency (OCC) has dropped a proposed automatic seven-day stablecoin redemption extension, while defining timely redemption as the point at which the issuer sends the money.

An issuer can meet its payment deadline before an outside bank makes the proceeds available.

The OCC’s final GENIUS Act rule, issued Oct. 21 and effective Jan. 18, 2027, retains an ordinary ceiling of two business days following a qualifying stablecoin redemption request. The endpoint is fully processed payment initiation, or, if the customer requests it, a credit to an account with the issuer.

The rule applies to issuers within the OCC framework, so it doesn't provide a universal timetable for every stablecoin sale or exchange withdrawal.

The adopted text removed a provision that would have automatically extended stablecoin redemption to seven calendar days when demand crossed a specified threshold.

Under section 15.12(d) of the OCC rule published in the Oct. 23 Federal Register, an issuer receiving stablecoin redemption requests above 10% of any brand’s outstanding issuance value in a single 24-hour period must notify its OCC supervisory office within 24 hours.

The issuer can ask the OCC for more time, and the regulator can grant or deny the request.

Crossing the threshold starts a supervisory process without automatically resetting the deadline, and the OCC says it expects extensions to be rare. Regulator-controlled limitations remain possible in other circumstances consistent with the law.

Section 15.12(a) also establishes explicit boundaries for the ordinary redemption clock, and the issuer must have received a redemption order.

Where its onboarding procedures are reasonably designed to avoid undue delay, including during stress, the customer must also have completed onboarding and satisfied the other legal conditions needed for redemption.

In explaining the final rule, the OCC says issuers cannot use onboarding deficiencies as a pretext to manufacture extra stablecoin redemption time. They should be ready to handle new customers during stress, including holders who previously relied on an intermediary.

Covered issuers must be able to redeem from retail holders, subject to applicable law, screening and onboarding. Their policies must permit quantities of one token or more.

The completion must fully process and initiate the directed outgoing transfer of monetary value to the customer or the customer’s financial institution. Alternatively, it can credit the customer’s account with the issuer if the customer requests that route. Merely placing a payment in a queue does not satisfy that wording.

External bank receipt comes later in the sequence and falls outside that defined endpoint. The practical implication is that the ordinary ceiling protects timely issuer action while bank-credit timing remains a separate part of the holder's cash-out.

Business days exclude Saturdays, Sundays, and federal holidays, so two business days also cannot be read as 48 elapsed hours.

Current service terms provide an example of access conditions before the OCC rule takes effect, but whether that framework governs a particular issuer depends on its jurisdiction.