The Office of the Comptroller of the Currency (OCC) took action to affirm that a range of cryptocurrency activities are permissible in the federal banking system. The previous administration had sought to deter regulated banks to participate in crypto affiliated activities.
The OCC published Interpretive Letter 1183 in order to confirm that crypto-asset custody, certain stablecoin activities, and “participation in independent node verification networks such as distributed ledger are permissible for national banks and federal savings associations.”
The letter also rescinds the requirement for OCC-supervised institutions to receive “supervisory nonobjection and demonstrate that they have adequate controls in place before they can engage in these cryptocurrency activities.”
Acting Comptroller of the Currency Rodney E. Hood said:
“The OCC expects banks to have the same strong risk management controls in place to support novel bank activities as they do for traditional ones. Today’s action will reduce the burden on banks to engage in crypto-related activities and ensure that these bank activities are treated consistently by the OCC, regardless of the underlying technology. I will continue to work diligently to ensure regulations are effective and not excessive, while maintaining a strong federal banking system.”
Consistent with Interpretive Letter 1183, the OCC has now also reportedly withdrawn its participation in “the joint statement on crypto-asset risks to banking organizations and the joint statement on liquidity risks to banking organizations resulting from crypto-asset market vulnerabilities.”
Notably, these developments confirm the major change in the new Trump Administration’s approach towards crypto. Despite these seemingly positive announcements, Bitcoin and cryptocurrency prices are trending downwards with investor sentiment indicating a more bearish market. This can be largely attributed to the fears about potentially rising inflation, a perception that the labor markets are weaker, and growing concerns about a potential recession.
Despite these issues, there’s been a fundamental shift in US policy towards crypto, which has prompted industry leaders like Coinbase‘s Brian Armstrong to announce that his firm now intends to hire 1,000 staff members in the US. Clearly, these are positive signs but markets remain pessimistic due to concerns about tariffs and excessive anticipated pressure on global supply chains.