at least 30% of its reserve assets as described above or amounts receivable and due unconditionally within five business days on pending sales of reserve assets, maturing reserve assets, or other maturing transactions;
no more than 40% of its reserve assets at any one eligible financial institution;
reserve assets with a weighted average maturity of no more than 20 days. 19
The OCC emphasizes in the Proposing Release that the requirements under Option A must be “tailored to the business model and risk profile,” and a smaller Stablecoin Issuer with a comparatively simple business model and lower risk profile may be able to satisfy the requirements of Option A without meeting the minimum requirements of the safe harbor. The quantitative safe harbor requirements, which were inspired by Rule 2a-7, essentially require that a Stablecoin Issuer maintain at least 10% of its reserve assets as “daily liquidity” and 30% as “weekly liquidity.” 20 As opposed to the principles-based approach of Option A, Option B would make the quantitative requirements of Option A’s safe harbor mandatory for all Stablecoin Issuers. Thus, if Option B is adopted, Stablecoin Issuers would be required to meet these quantitative requirements each business day.
Diversity of Custodial Arrangements
Option A would also require Stablecoin Issuers to monitor the risk associated with holding their reserve assets at a single or a small number of financial institutions. 21 This provision is intended to require Stablecoin Issuers to manage the risk that a financial institution is unable to or delayed in returning reserve assets to the Stablecoin Issuer that are needed to pay redemption requests. The OCC also notes that it would expect Stablecoin Issuers to “look through” any sub-custodial relationships to confirm that their reserves are held at a sufficiently diverse number of financial institutions. While Option A would not explicitly prohibit a Stablecoin Issuer from holding all of its reserve assets at a single financial institution (other than to comply with the provisions of the safe harbor), the OCC states that it “expects that it would be unlikely … [that a Stablecoin Issuer] … could satisfy the requirements in [the Proposed Rules] by placing all its reserve assets at a single eligible financial institution.” Further, the OCC notes that larger Stablecoin Issuers with complex
19 The OCC requests comment on whether it should adopt a specific definition of “weighted average maturity”, including whether it should incorporate maturity shortening provisions similar to Rule 2a-7. 20 The OCC’s proposed 10% “daily liquidity” and 30% “weekly liquidity” appear to be influenced by a prior version of Rule 2a-7. In 2023, the SEC adopted amendments to Rule 2a-7 which, among other things, increased the daily and weekly liquidity requirements for money market funds to 25% and 50%, respectively. 21 The Proposed Rules provide that reserve assets must either be held directly by the Stablecoin Issuer or within the custody of an “eligible financial institution.”
March 2026 / Page 10
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