tl;dr
The Office of the Comptroller of the Currency (OCC) issued Interpretive Letter 1184 on May 7, clarifying that federally chartered banks and savings associations can offer cryptocurrency services such as custody and trade execution, including through third-party providers, without prior regulatory ap...
The Office of the Comptroller of the Currency (OCC) issued Interpretive Letter 1184 on May 7, reaffirming that federally chartered banks and savings associations can offer cryptocurrency services such as custody and trade execution without prior regulatory approval. This includes engaging third-party providers, as long as they adhere to robust risk management and legal compliance standards.
The letter emphasizes that these digital asset services must comply with sound risk management practices, due diligence, third-party risk management, and cybersecurity protocols. It builds upon earlier guidance and a policy shift announced in March, which removed the requirement for advance approval for certain crypto-related activities by nationally chartered banks.
The OCC clarified that banks may buy and sell crypto assets held in custody at the customer’s direction and outsource crypto functions while maintaining the same oversight as traditional financial services. This policy update signals increasing regulatory acceptance and normalization of crypto services within the U.S. banking sector, provided these activities are conducted safely and in compliance with federal laws.
By expanding the guidance to include execution services and sub-custodian relationships, the OCC reinforces its position that digital asset services fall within permissible banking operations. The move aims to streamline oversight while preserving high safety standards, enabling banks to integrate crypto assets without procedural hurdles.
Overall, the OCC’s updated letter marks a significant step in the evolving regulatory landscape, supporting innovation in crypto services while prioritizing operational risk controls and legal compliance within federally chartered institutions.