What Is BlackRock Asking the OCC to Change?
BlackRock has urged the Office of the Comptroller of the Currency to scale back several proposed reserve asset limits in draft rules tied to the GENIUS Act, with the asset manager taking direct issue with a possible cap on tokenized reserves.
The firm submitted its 17-page comment letter on Friday, the final day of the OCC’s 60-day comment window. The draft rules cover reserve composition, capital, custody, and restrictions on yield for permitted payment stablecoin issuers.
BlackRock’s main objection is a potential 20% cap on tokenized reserve assets. The firm argued that reserve risk should be assessed based on credit quality, duration, and liquidity, not on whether an asset is held or transferred on a distributed ledger.
Why Does the Tokenized Reserve Cap Matter?
The issue is material for BlackRock because of its growing role in tokenized Treasury products. Its BUIDL fund holds nearly $2.6 billion in assets, according to RWA.xyz data cited in the report, and backs more than 90% of the reserves behind Ethena’s USDtb and Jupiter’s JupUSD.
A 20% cap would limit the use of products like BUIDL as reserve assets under the federal stablecoin framework. That could restrict growth for tokenized Treasury funds even as stablecoin issuers seek liquid, short-duration instruments to back their tokens.
BlackRock’s position also reflects a broader industry dispute over whether tokenized funds should face extra limits simply because they use blockchain rails. The firm is arguing that the asset’s structure and risk profile should matter more than the transfer method.
Investor Takeaway
What Other Reserve Changes Did BlackRock Request?
BlackRock also asked the OCC to confirm that Treasury ETFs qualify as eligible reserves under the GENIUS Act. The firm warned that unclear wording could discourage stablecoin issuers from holding ETFs even when those funds invest only in eligible reserve assets.
The asset manager backed the OCC’s principles-based reserve option, which includes an optional quantitative safe harbor. It opposed making the same limits mandatory for all issuers on a daily basis, including a 40% single-institution concentration limit and a 20-day weighted average maturity ceiling.
BlackRock also requested changes to how government money market funds are treated, including excluding self-custodied fund shares from the 40% concentration limit and allowing same-day-settlement government money market funds to count toward weekly liquidity requirements.
Investor Takeaway
How Does This Fit Into the GENIUS Act Rulemaking?
The OCC proposal is one part of a wider federal rulemaking process ahead of a January 2027 compliance deadline. The FDIC has advanced its own proposal, while Treasury, FinCEN, and OFAC are working on related rules covering state oversight, anti-money-laundering programs, and sanctions compliance.
BlackRock is already preparing for the new stablecoin framework. In October, it reworked its Select Treasury Based Liquidity Fund into a GENIUS-compliant product aimed at stablecoin reserves, with a Treasury-heavy mandate and a 5 p.m. ET trading deadline.
The final rules will help determine whether stablecoin reserves remain concentrated in traditional bank deposits and Treasury bills, or whether tokenized funds and ETFs become a larger part of the market’s infrastructure.
