Key Takeaways
- • BlackRock filed a 17-page comment letter to the OCC on May 1, 2026, urging removal of a proposed 20% quantitative cap on tokenized reserve assets for permitted payment stablecoin issuers under the GENIUS Act framework.
- • The asset manager argued that the 20% tokenized asset cap is "extraneous" to regulatory objectives, contending that risk profiles are determined by credit quality, duration, and liquidity rather than whether assets are held on distributed ledgers.
- • BlackRock's BUIDL tokenized Treasury fund—managing nearly $2.6 billion in assets and backing over 90% of reserves for stablecoins including Ethena's USDtb and Jupiter's JupUSD—would face material constraints under a 20% tokenized reserve limitation.
- • BlackRock also requested explicit OCC confirmation that exchange-traded funds investing solely in eligible reserve assets, such as Treasury ETFs, qualify as permissible reserves under the GENIUS Act framework.
- • The comment was submitted on the final day of the OCC's 60-day public comment period, which opened March 2, 2026, following the agency's notice of proposed rulemaking implementing the GENIUS Act stablecoin regulatory framework.
Summary
BlackRock, the world's largest asset manager, submitted a formal 17-page response to the Office of the Comptroller of the Currency on May 1, 2026, challenging a central element of the agency's proposed rules implementing the GENIUS Act—specifically, a 20% quantitative cap on tokenized reserve assets for permitted payment stablecoin issuers. The submission came as the OCC's 60-day public comment window closed, following the agency's March 2 publication of a comprehensive notice of proposed rulemaking that posed more than 200 feedback questions spanning reserve composition, capital custody arrangements, and yield restrictions.
BlackRock's most substantive objection targeted the tokenized asset cap itself. The firm contended that limiting tokenized reserves to 20% of total reserves is unnecessary to achieve the OCC's regulatory objectives and lacks economic rationale. BlackRock argued that credit risk, maturity duration, and liquidity characteristics—not the underlying settlement mechanism or ledger technology—determine asset risk profiles. This position reflects a fundamental disagreement over whether tokenization creates a distinct regulatory category warranting quantitative constraints separate from traditional reserve asset rules.
The commercial stakes for BlackRock are significant. Its BUIDL fund, one of the largest tokenized Treasury products with approximately $2.6 billion in assets under management, currently provides over 90% of the reserves backing major stablecoins including Ethena's USDtb and Solana-based Jupiter's JupUSD. A 20% cap on tokenized reserves would materially constrain BUIDL's capacity to serve as a backing asset under the federal stablecoin framework, directly limiting growth potential for stablecoins relying on BlackRock's tokenized products as core collateral. Circle's USYC stablecoin currently leads the market with $2.9 billion in assets under management, highlighting the competitive dynamics of the emerging tokenized reserve ecosystem.
BlackRock also pressed the OCC for explicit regulatory clarity on whether exchange-traded funds investing solely in eligible reserve assets—particularly Treasury ETFs—would qualify as permissible reserves under Section 4 of the GENIUS Act. This request underscores the broader tension between traditional and tokenized reserve structures as the OCC finalizes implementation rules for the stablecoin framework authorized under legislation signed by President Trump in July 2025.
BlackRock's most substantive objection targeted the tokenized asset cap itself. The firm contended that limiting tokenized reserves to 20% of total reserves is unnecessary to achieve the OCC's regulatory objectives and lacks economic rationale. BlackRock argued that credit risk, maturity duration, and liquidity characteristics—not the underlying settlement mechanism or ledger technology—determine asset risk profiles. This position reflects a fundamental disagreement over whether tokenization creates a distinct regulatory category warranting quantitative constraints separate from traditional reserve asset rules.
The commercial stakes for BlackRock are significant. Its BUIDL fund, one of the largest tokenized Treasury products with approximately $2.6 billion in assets under management, currently provides over 90% of the reserves backing major stablecoins including Ethena's USDtb and Solana-based Jupiter's JupUSD. A 20% cap on tokenized reserves would materially constrain BUIDL's capacity to serve as a backing asset under the federal stablecoin framework, directly limiting growth potential for stablecoins relying on BlackRock's tokenized products as core collateral. Circle's USYC stablecoin currently leads the market with $2.9 billion in assets under management, highlighting the competitive dynamics of the emerging tokenized reserve ecosystem.
BlackRock also pressed the OCC for explicit regulatory clarity on whether exchange-traded funds investing solely in eligible reserve assets—particularly Treasury ETFs—would qualify as permissible reserves under Section 4 of the GENIUS Act. This request underscores the broader tension between traditional and tokenized reserve structures as the OCC finalizes implementation rules for the stablecoin framework authorized under legislation signed by President Trump in July 2025.
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