In Q1 2026, Coinbase reported $305 million in stablecoin revenue, primarily from its partnership with Circle, which issues USDC. Coinbase pays USDC holders a 3.5% annual percentage yield (APY) as a loyalty reward, a move that the recently enacted GENIUS Act was designed to restrict. However, the Act's drafters did not explicitly ban affiliate-paid yield, allowing Coinbase to operate within a loophole. The Office of the Comptroller of the Currency (OCC) has proposed new rules to close this loophole, introducing a rebuttable presumption against yield arrangements between issuers and affiliates. This change could significantly impact Coinbase's revenue model, as the arrangement incentivizes USDC holders to keep their balances on Coinbase. The banking industry is advocating for stricter interpretations to protect their interests, fearing that competitive yields from exchanges could siphon retail deposits away from traditional banks. If the OCC's proposed rule is finalized, it may lead to a decrease in USDC rewards, prompting Coinbase to lose market share and Circle to face reduced revenue. The evolving regulatory landscape highlights the tension between traditional banking interests and the rapidly growing cryptocurrency exchange sector.