GENIUS Act Framework: Circle Backs OCC’s Stablecoin Licensing Proposal

TLDR:

• • Circle submitted comments to the OCC backing its proposed rule implementing the landmark GENIUS Act stablecoin framework.
    
  • The company called for uniform prudential standards across all issuers, whether bank or nonbank, state, federal, or foreign.
    
  • Circle drew a clear distinction between payment stablecoins and tokenized deposits, urging separate regulatory treatment for each.
  • Consumer redemption rights and strong risk management controls were identified as non-negotiable pillars of the final framework.

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Circle has submitted a formal comment letter to the Office of the Comptroller of the Currency supporting its proposed rule under the GENIUS Act. 

The submission backs the OCC’s framework for payment stablecoins, calling it a major regulatory milestone. 

Circle argues that the proposed standards establish the operational and financial controls needed for institution-grade digital finance. 

The company believes the rule can set a global benchmark for trusted digital dollars backed by U.S. law.

Circle Outlines Core Principles for the Final Framework

The OCC’s proposed rule covers reserve management, information security, and risk controls for stablecoin issuers. Circle supports what it calls the “highest-bar” standards put forward by the agency. Circle posted on X about the development, sharing its position on the proposed framework:

These standards require issuers to operate as standalone, ring-fenced entities with dedicated financial controls. The framework also mandates seamless 24/7/365 functionality to meet global demand.

Circle emphasized that payment stablecoins must function as a single, uniform instrument across platforms and markets. Fragmentation, the company warned, adds systemic risk and reduces liquidity.

A stablecoin’s value depends on it being transferable and fungible across customers and institutions. Without that consistency, redemption becomes less reliable for everyday holders.

Consumer protection is another area Circle addressed in its submission. The company stated that issuers must be able to honor redemptions for holders anywhere in the world.

Confidence in a stablecoin rests on one core promise: users can get their money back when needed. That assurance, Circle argued, must be built into the framework at its foundation.

Circle also stressed the need for a level playing field across all issuer types. Whether an issuer is a bank or nonbank, state or federal, domestic or foreign, all must operate within the same prudential perimeter. Regulatory arbitrage, the firm noted, can disadvantage compliant issuers and weaken market trust overall.

Stablecoins and Tokenized Deposits Require Separate Regulatory Treatment

Circle drew a clear line between payment stablecoins and tokenized deposits, noting they serve different purposes. Congress explicitly excluded tokenized deposits from the GENIUS Act for this reason.

Payment stablecoins are designed for broad transferability and settlement across open networks. Tokenized deposits, by contrast, represent digital bank liabilities with a narrower use case.

The company also called for strong risk management frameworks covering credit, liquidity, concentration, and anti-money laundering controls. These are not optional features but core requirements for instruments used in global payment and settlement.

Stablecoins carry financial and operational responsibilities that extend well beyond being technology products. Treating them otherwise, Circle argued, would expose the broader financial system to unnecessary risk.

With the GENIUS Act now serving as a legislative foundation, the OCC’s rulemaking translates that law into practical standards.

Circle’s submission reflects a broader industry interest in seeing clear, consistent rules applied uniformly across the stablecoin market.

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