The largest player in global finance has entered the arena with a move that could change the fate of stablecoin regulation. BlackRock, in a comprehensive 17-page comment letter submitted to the Office of the Comptroller of the Currency (OCC), requested the removal of the proposed 20% cap on tokenized reserve assets under the GENIUS Act. This development is not just a reactive measure by a company to protect its own product; it represents one of the strongest corporate battles yet for integrating real-world assets (RWAs) into the backbone of the financial system.

✨ The OCC proposal consisting of 376 pages and a breakdown of the 20% limit
🔹Remember: The GENIUS Act, signed by President Trump on July 18, 2025, established the first federal regulatory framework for stablecoins for payments. The law, which passed the Senate overwhelmingly 68 to 30 and the House by a vote of 308 to 122, limits the issuance of stablecoins to federally licensed entities called "Licensed Payment Stablecoin Issuers" (PPSIs).
🔹On February 25, 2026, the OCC published a 376-page draft rule to implement this law. The draft was published in the Federal Register on March 2, initiating a 60-day public comment period. One of the most controversial provisions in this draft, shaped by over 200 questions, was the imposition of a 20% cap on tokenized assets that PPSIs can hold in their reserves.
🔹On Friday, May 2, the last day of this 60-day period, BlackRock submitted a 17-page comment letter to the OCC public record.
✨ BlackRock’s main argument: Risks lie in the origin, not in the blockchain
🔹The most prominent statement in BlackRock’s letter is its clear affirmation that the proposed 20% cap is "unnecessary" from the OCC’s regulatory objectives.
🔹The company’s argument relies on the premise that the risk profile of the reserve asset is determined by fundamental financial metrics such as credit quality, maturity, and liquidity. Whether the asset is held on a distributed ledger or on a ledger, the risk level does not change. As BlackRock states in the letter: "Risk profiles depend on credit quality, maturity, and liquidity, not on whether the asset is held on a distributed ledger or transferred."
🔹This stance actually advocates a deeper principle: regulations should target risks, not technology. Whether a Treasury bond is held on traditional books or on a blockchain, it carries the same credit risk. Therefore, the regulatory framework should be unified as well.
✨ BUIDL factor: a tokenized treasury fund worth $2.6 billion
🔹To understand why BlackRock is fighting so fiercely, just look at the size of the BUIDL fund. According to RWAs data, BlackRock’s tokenized treasury fund BUIDL has reached approximately $2.6 billion in assets.
🔹Most importantly, the strategic positioning of the fund within the stablecoin ecosystem:
· Provides over 90% of the reserves for the USDt stablecoin on Ethereum.
· Covers over 90% of the reserves for Jupiter, a Solana-based stablecoin JupUSD.
🔹The 20% cap would directly bottleneck the expansion capacity of the source reserves for federal stablecoins. Currently, Circle’s USYC leads the tokenized treasury space with $2.9 billion in assets, and the regulatory framework will be a decisive factor in this competition.
🔹Another sign of BlackRock’s commitment in this area is the conversion of its Treasury-Backed Liquidity Fund (BSTBL) into a GENIUS-compliant product last October, specifically designed to serve stablecoin reserves.
✨Other key demands in the letter
🔹BlackRock’s requests to the OCC are not limited to removing the 20% cap. Other main points highlighted in the letter include:
🔹Recognition of ETFs as reserve assets: BlackRock requests clarification on whether Treasury ETFs that invest solely in qualified reserve assets are considered reserve assets under Section 4 of the GENIUS Act. They argue that these funds should receive the same safe treatment as government money market funds.
🔹 🔹Two-year variable-rate Treasury bonds: Due to their weekly coupon reset feature and limited price volatility, BlackRock recommends adding U.S. variable-rate Treasury bonds with maturities up to two years to the list of eligible reserve assets.
🔹Support and modification of Option A: BlackRock supports Option A, one of the two options offered by the OCC for diversifying reserves, which combines a principles-based standard with an optional quantitative safe harbor. Conversely, it notes that Option B, which imposes strict daily requirements such as a 40% concentration limit for a single institution and a maximum weighted average maturity of 20 days, lacks flexibility.
🔹More transparent approval process: BlackRock calls for the creation of an official and transparent assessment process for new instruments to be added to the list of eligible reserve assets in the future.
✨Critical timeline and concurrent rulemaking process for the GENIUS Act
🔹The implementation schedule for the GENIUS Act is advancing rapidly. Under the law, regulators such as the OCC, FDIC, Treasury (FinCEN and OFAC), and the Federal Reserve are required to publish final implementing regulations by July 18, 2026. The law takes effect on January 18, 2027, or 120 days after the final regulations are published.
🔹Recent months have seen a notable escalation in regulatory activity. On April 8, FinCEN and OFAC issued a joint proposed rule integrating PPSIs into AML and compliance frameworks. In April, the FDIC proposed two separate rules related to licensing and standards for reporting and auditing.
🔹This layered regulatory architecture will shape the future structure of the stablecoin market. BlackRock’s letter is at the heart of this crucial process.
✨Global expansion of BUIDL: Exchance partnership with Standard Chartered
🔹BlackRock’s active defense of the OCC aligns with the momentum BUIDL is gaining worldwide. On April 29, it was announced that the partnership between Exchance, BlackRock, and Standard Chartered is the first major global regulatory framework (G-SIB) integrating BUIDL into institutional collateral workflows.
🔹Under this framework, Exchance VIP and institutional clients can hold BUIDL as off-exchange collateral in Standard Chartered’s organized custody service, while trading simultaneously on Exchance. BUIDL can also be used as collateral on the platform to generate yields.
🔹As Samara Cohen, Head of Global Markets Development at BlackRock, stated: "BUIDL is designed to bring the benefits of short-term treasury risk tokenization to qualified investors on the blockchain network."
✨ Significance and potential market outcomes
🔹How OCC responds to BlackRock’s request is one of the most critical variables shaping the future of the tokenized RWAs market. If accepted:
🔹First outcome: Tokenized funds like BUIDL could become a standard component in the reserve structure of bank-issued stablecoins. This could lead to explosive growth in the tokenized treasury market.
🔹Second outcome: Adoption of BlackRock’s principles-based approach could set a precedent for future regulations "targeting risks, not technology."
🔹Third outcome: Recognizing ETFs as reserve assets could shift stablecoin reserves from sovereign money market funds to ETFs.
🔹On the other hand, in a scenario maintaining the 20% cap, tokenized assets in stablecoin reserves would remain a limited supplement, and products like BUIDL would need to seek alternative growth pathways.
🔹Decision-making processes are expected to become clearer in the coming months. So far, the only certain thing is that the world’s largest asset manager will not accept this challenge quietly.
✨Wise regulation is not when technology is restricted, but when risks are truly acknowledged. Smart capital thrives on rules that understand, not #$H