Banks Receive OCC Approval to Handle Crypto Transactions for Clients

Key PointsThe U.S. Office of the Comptroller of the Currency (OCC) confirms that banks can trade or custody crypto assets for clients.Permissible crypto activities must be conducted within applicable laws.The OCC has provided clarification that U.S. banks are authorized to hold, trade, or allow third parties to manage their clients’ crypto assets, such as Bitcoin.However, these permissible crypto activities must be conducted within the boundaries of applicable laws.OCC’s Stance on CryptoAn interpretive letter issued on the 7th of May clarified that national banks could permit third parties to provide these services with the consent of their clients.The CEO of the OCC, Rodney Hood, further elaborated that banks could also offer additional services.He stated, “These banks may provide other custody services, including record keeping, tax, or reporting services for their customers. OCC banks may use a sub-custodian to provide the same services.”This follows a guidance issued in March, which allowed banks to handle crypto assets and stablecoins.Interestingly, this memo also overturned a previous restrictive stance against the digital assets sector that had been in place since 2021.Reception of the UpdateThis shift towards a pro-crypto stance is increasingly evident under the President Donald Trump Administration.The U.S. House Committee on Financial Services, led by Republicans, applauded the OCC’s latest update and pledged support for the crypto market structure bill.However, Hood emphasized that the OCC expects all permissible crypto activities to be conducted safely, soundly, and in compliance with applicable law.Stablecoins, in particular, seem poised to benefit from this significant shift, potentially disrupting the traditional banking system.