U.S. banks get green light to expand crypto services with fresh OCC guidance fueling regulatory clarity and innovation in digital assets.
The Office of the Comptroller of the Currency (OCC) announced on May 7 the release of Interpretive Letter 1184, offering fresh guidance that reaffirms national banks’ and federal savings associations’ authority to engage in crypto-related services. This clarification confirms that federally chartered banks may both provide and outsource cryptocurrency custody and execution services, aligning with previously issued Interpretive Letters 1170 and 1183. The OCC stated:
"National banks and federal savings associations may buy and sell assets held in custody at the customer’s direction and are permitted to outsource to third parties bank-permissible crypto-asset activities, including custody and execution services, subject to appropriate third-party risk management practices."
The new letter highlights that crypto-asset custody is regarded as a modern version of traditional bank custodial services. The OCC previously recognized that banks could act in either fiduciary or non-fiduciary roles when offering custody solutions for digital assets.
In Letter 1184, the OCC also reaffirmed that these institutions can facilitate services such as exchange transactions between fiat and cryptocurrency, trade execution, transaction settlement, valuation, tax services, and reporting, as long as these functions are conducted at the customer’s direction and within the bounds of applicable law. Banks are also permitted to use sub-custodians for these activities. The OCC underscored that proper due diligence and risk oversight must be in place when outsourcing such responsibilities.
Additionally, the OCC reminded institutions that all crypto-related custodial actions must adhere to federal regulatory standards. For banks operating in a fiduciary capacity, compliance with 12 C.F.R. part 9 (for national banks) or part 150 (for federal savings associations) is mandatory. Reinforcing the importance of prudent operations, the OCC emphasized:
"As with any activity, a bank must conduct crypto-asset custody activities, including via a sub-custodian, in a safe and sound manner and in compliance with applicable law."
This announcement followed one in March when the OCCissuedInterpretive Letter 1183, revoking Letter 1179 and reaffirming earlier guidance allowing national banks and federal savings associations to conduct crypto-asset activities. They include crypto custody (Letter 1170), holding reserves for stablecoins (Letter 1172), and using blockchain for payments and verification (Letter 1174). The OCC stated that 1179’s supervisory nonobjection process is no longer needed due to improved regulatory insight. The move seeks to reduce compliance hurdles, support responsible innovation, and ensure consistent treatment of bank activities, regardless of the underlying technology.
While some regulators remain wary of financial institutions entering the digital asset space, supporters argue that clear guidelines such as those issued by the OCC enable banks to innovate responsibly and meet growing client demand for crypto services.