any other similarly liquid federal government-issued asset approved by the primary federal stablecoin regulator; 15 and
certain eligible reserve assets enumerated above that are in tokenized form.
The Proposing Release encourages Stablecoin Issuers seeking clarity on whether a specific tokenized asset qualifies as a permissible reserve asset to request an opinion from the OCC. To aid transparency, the OCC is considering publishing a list of acceptable tokenized reserve assets.
Valuation, the 1:1 Requirement, and De-Pegging Risk
Under the Proposed Rules, reserve assets must be valued at fair market value (rather than another measure, such as amortized cost) for determining compliance with the 1:1 backing requirement. However, a Stablecoin Issuer’s outstanding issuance value must be measured at par, not at the secondary market price of the payment stablecoin. Therefore, if a payment stablecoin “de-pegs” from its intended stable value, the Stablecoin Issuer must nevertheless maintain reserves equal to the par value of all its outstanding payment stablecoins. The OCC states in the Proposing Release that this design choice is intended to prevent Stablecoin Issuers from reducing reserves if payment stablecoins de-peg, which could exacerbate run risk. The Proposed Rules would define “fair value” to mean fair value as determined under generally accepted accounting principles (“GAAP”). 16 Under GAAP, the fair value of shares of an investment company would typically be the fund’s net asset value per share, which is typically $1.00 per share for most government money market funds. 17 This requirement may make holding reserves in government money market funds advantageous for Stablecoin Issuers, particularly in certain interest rate environments.
Accessibility, Monetization and Withdrawal of Excess Reserve Assets
Under the Proposed Rules, a Stablecoin Issuer must demonstrate that it has the operational capability to access and monetize its reserve assets. The OCC notes in the Proposing Release that
15 The Proposed Rules would set relevant factors the OCC will consider in determining whether an asset qualifies, including: whether the asset has liquidity characteristics, including during times of stress, comparable to the other permissible reserve assets; whether Stablecoin Issuers will be operationally capable of monetizing the asset to meet redemption requests, including sudden and high-volume requests; whether the asset poses levels of risk comparable to other permissible assets, including interest rate risk and counterparty credit risk; and whether the asset introduces additional risks that may be difficult for Stablecoin Issuers to manage. 16 Under the Financial Accounting Standards Board’s Accounting Standards Codification (ASC) 820-10-20, fair value is defined as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” FASB, “Topic 820,” ASC 820-10-20. 17 Most government money market funds seek to maintain a stable price per share ( i.e. , $1.00) for purposes of distribution, redemption and repurchase by using the amortized cost and/or penny-rounding methods of valuation. Such money market funds must also calculate and publish on their website the fund’s net asset value per share rounded to four decimal places calculated using market-based pricing, ( i.e. , its “shadow price”); however, this is not the price at which the fund’s shares are purchased or redeemed.
March 2026 / Page 8
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