National banks and federal savings associations may buy and sell crypto assets held in custody, the national bank regulator confirmed Wednesday in an interpretive letter.
The Office of the Comptroller of the Currency (OCC) said the banks may transact the assets at the customer’s direction. The agency further said the banks 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.”
Wednesday’s letter was the second such interpretive letter issued by the OCC about crypto-asset activities subject in the last two months. Interpretive letter 1183, issued in March, the agency essentially reversed its recent course, saying banks could engage in “a range of cryptocurrency activities.” Those included, the OCC said, “crypto-asset custody, “certain stablecoin activities,” and “participation in independent node verification networks such as distributed ledger.”
In the March letter, the agency it had also rescinded a requirement that banks it supervises must receive “supervisory nonobjection” and show they have adequate controls in place before they can engage in these cryptocurrency activities.
The OCC also said it had withdrawn its participation in the joint statement on crypto-asset risks to banking organizations and the joint statement on liquidity risks to banking organizations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.
The Federal Reserve and the Federal Deposit Insurance Corp. (FDIC), on April 24, announced they were withdrawing statements issued in January and February of 2023, which addressed crypto-asset risks and liquidity risks to banking organizations resulting from crypto-asset market vulnerabilities.
The Fed specifically pointed out the action by the two regulators matched action taken earlier this year by the OCC.
OCC Clarifies Bank Authority to Engage in Crypto-Asset Custody and Execution Services
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