BlackRock Urges OCC To Scrap Tokenized Reserve Cap
Stablecoins
BlackRock submitted a formal 17-page comment letter to the Office of the Comptroller of the Currency on May 2, 2026, challenging restrictive draft rules regarding stablecoin reserve management under the GENIUS Act. The firm specifically urged the agency to remove caps on tokenized reserves and requested that exchange-traded funds investing in eligible assets be granted the same quantitative safe harbor status as government money market funds. By advocating for the principles-based 'Option A' over mandatory daily minimums, BlackRock aims to provide issuers with greater flexibility in managing liquidity and reserve diversification. The letter also proposed expanding the list of eligible reserve assets to include U.S. Treasury floating-rate notes with up to two years of maturity. This intervention is significant as it highlights the tension between traditional financial institutions and regulators attempting to standardize the rapidly evolving stablecoin sector. With a federal compliance deadline looming in January 2027, BlackRock's recommendations could fundamentally shape the operational framework for stablecoin issuers. The firm's active involvement underscores its strategic commitment to integrating its Select Treasury Based Liquidity Fund into the broader digital asset ecosystem.
Key points
- ▸BlackRock requested quantitative safe harbor status for ETFs holding eligible stablecoin reserve assets.
- ▸The firm endorsed 'Option A' to allow flexible, principles-based reserve management for issuers.
- ▸BlackRock proposed adding U.S. Treasury floating-rate notes to the list of eligible reserves.
- ▸Federal agencies face a January 2027 deadline for finalizing stablecoin regulatory compliance rules.
Background
The GENIUS Act is a legislative framework designed to establish federal standards for stablecoin issuers, focusing on reserve transparency and asset quality. It aims to mitigate systemic risk by mandating that stablecoins are backed by high-quality, liquid assets like U.S. Treasuries. The OCC is currently drafting rules to implement these requirements, which will dictate how issuers manage their collateral to maintain peg stability.
Relevance
8.5/10