What happened
The OCC said this week that the GENIUS Act's prohibition on interest-bearing stablecoins binds the issuer, not the venue that holds the coin on a user's behalf. In practice, that leaves Coinbase's USDC rewards program and Robinhood's stablecoin yield offering intact, both of which pay users a return on idle stablecoin balances funded from the exchange's own treasury operations rather than from Circle.
Bitcoinist, which reported the guidance on October 27, framed it as a direct answer to a letter campaign from the American Bankers Association and state banking groups that had pressed the Treasury and the OCC to read the statute broadly. Circle itself still cannot pay a coupon on USDC. Tether, which does not operate as a US-regulated issuer, sits outside the rule entirely.
The agency's position effectively splits the stablecoin stack into a regulated issuance layer and an open distribution layer where competition on rewards is permitted.
Why it matters
The GENIUS Act was supposed to lock stablecoins into a narrow-bank model with no yield. The banking lobby took the law to mean exactly that, at every layer of the stack. The OCC just told them it doesn't.
That is the one-line read, and it is a meaningful loss for the lobby that spent most of the summer arguing the opposite. Coinbase's USDC rewards hovered near 4. 1% earlier this year and remain one of the most-cited reasons retail users keep balances on the exchange rather than sweeping them into a bank.
Robinhood's gold-tier stablecoin yield, launched in 2025, plays the same role. Both would have shut off under a strict reading. The clarification keeps roughly $160B of circulating USDC and a growing share of PYUSD and RLUSD inside a product structure that competes directly with checking accounts on headline rate.