The Office of the Comptroller of the Currency has finalized its GENIUS Act rules. Circle's USDC and Tether's USDT now face different challenges under the new US framework.
The OCC finalized rules implementing the GENIUS Act, with an effective date of January 18, 2027. The framework sets requirements covering reserves, redemptions, risk management, reporting, and regulatory supervision.
Federal oversight is taking shape as the US stablecoin market enters a new regulatory phase, and the rules land differently on Circle and Tether. Circle could benefit from its established US regulatory positioning, while Tether faces questions about how its international business will fit the new framework.
USDT leads on market share, USDC has room to grow
USDT holds 60.7% of the stablecoin market, compared with 23.9% for USDC. Together, the tokens represented 84.6% of the market.
For Circle, USDC has room to expand, particularly among institutions seeking regulated digital-dollar infrastructure. However, winning share will require continued adoption, liquidity, and integration. Tether's priority is protecting USDT's established position while it adapts to a more regulated market, and its international user base remains a significant competitive asset.
Rewards rules shape the exchange fight
The effects reach beyond issuers. Exchanges, payment providers, and financial institutions must assess which tokens they can support and how their products fit the framework.
Stablecoin rewards have become another battleground. The OCC's final rule prohibits issuers from directly paying interest or yield to holders simply for holding payment stablecoins. It does not impose a blanket ban on third-party reward programs, and regulators will assess those arrangements case by case, including whether they circumvent the law's restrictions.
That approach could shape how exchanges compete for stablecoin deposits. Platforms may retain room to offer qualifying rewards, while issuers and their partners will need to consider how they structure their arrangements.
What comes next
The GENIUS Act also leaves further implementation work, including separate requirements for anti-money laundering and sanctions compliance. The January 18, 2027, effective date gives affected businesses time to prepare. Issuer applications and regulatory decisions will help determine how the framework operates in practice.
Source: Cryptonews
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