Unleashing Banks in the Crypto Sphere: OCC's New Green Light
Banks now granted authorization under OCC guidelines to manage cryptocurrency storage and stablecoin operations.
Here's the lowdown on the Office of the Comptroller of the Currency (OCC)'s latest ruling, issued on May 7, 2025, under Interpretive Letter 1184. Banks, otherwise known as your granddad's money managers, can now dive headfirst into the world of cryptocurrencies.
Crypto Custody Services: Hold My Keys
Federally chartered banks and savings associations can now offer crypto-asset custody services. This involves holding cryptographic keys for customers, managing the transfer, settlement, and safekeeping of digital assets. Plus, they're allowed to buy and sell those assets at the customer's command, making them your one-stop crypto solution.
It gets even better—third parties are welcome to lend a helping hand in providing custody and execution services. As long as banks observe strict third-party risk management standards, everyone's happy.
Stablecoins: Calm Waters Ahead
Banks can now facilitate stablecoin transactions for their customers, with third-party providers also on the menu. These services operate under the same risk management and compliance standards as other banking activities, ensuring a steady and secure experience for users.
DeFi: Cautiously Navigating the Wild West
The OCC's latest letter doesn't explicitly dive into the world of decentralized finance (DeFi) platforms. However, activities such as providing access to or interfacing with DeFi would likely be assessed under existing risk management and compliance frameworks, but the OCC hasn't yet issued detailed DeFi-specific guidance.
Policy Shifts, Approvals, and More
In a significant break from the past, banks no longer need prior approval from the OCC to offer crypto-asset custody and execution services as long as they comply with existing regulations and risk management practices. This regulatory shift aligns digital asset management more closely with traditional banking operations.
The OCC's latest clarification builds on prior letters (Interpretive Letters 1170 and 1183), further reinforcing that digital asset services can be a part of acceptable banking practices when conducted safely and in compliance with applicable laws.
Breaking Down the Services:
| Service Area | Permissible? | Third-Party Allowed? | Prior Approval Needed? | DeFi Addressed? ||---------------------|---------------------|---------------------|----------------------|----------------|| Crypto Custody | Yes | Yes | No | No || Stablecoin Transactions | Yes | Yes | No | No || DeFi | Not specified | N/A | N/A | No |
With this shift in policy, banks can join the crypto party, providing long-term clarity and more opportunities for growth in the digital asset management sector. It's time to say goodbye to uncertainty and hello to steady progress in the world of cryptocurrency.
- Banks can now offer crypto-asset custody services, including holding cryptographic keys, transferring, settling, and safekeeping of digital assets, as well as buying and selling these assets at a customer's command.
- Third-party providers are allowed to lend a hand in offering custody and execution services, as long as banks manage third-party risk according to established standards.
- Banks can facilitate stablecoin transactions for their customers, with third-party providers also an option,under the same risk management and compliance standards as other banking activities.
- The Office of the Comptroller of the Currency (OCC) has not yet explicitly addressed decentralized finance (DeFi) platforms in its latest letter, but such activities may be assessed under existing risk management and compliance frameworks if they are conducted safely and in compliance with applicable laws.
