US Banks Get Green Light to Hold Crypto for Clients—Regulators Finally Wake Up
After years of regulatory foot-dragging, the OCC just handed banks a golden ticket: custody crypto like any other asset. No more hiding behind ’too risky’ excuses—Wall Street’s vaults are officially open for Bitcoin.
Why now? Maybe because they finally noticed the $2T elephant in the room. Or maybe because clients were fleeing to offshore exchanges faster than Jamie Dimon can say ’fraud.’ Either way, the dam has broken.
Watch for the usual suspects—JPMorgan, BofA—to roll out ’secure digital asset solutions’ with fees that’d make a crypto exchange blush. Welcome to institutional adoption, where the infrastructure comes pre-monetized.
Source: OCC.gov
What OCC’s Crypto Custody Rules Mean for Security & Regulations
Banks Gain Explicit Authority to Custody and Trade Crypto
The OCC’s letter clarifies that national banks may:
- Hold cryptographic keys associated with customer crypto assets.
- Execute transactions (buy/sell) on behalf of customers.
- Provide ancillary services like tax reporting, valuation, and settlement.
states Letter 1184, emphasizing parity with traditional asset custody.
Outsourcing to Third Parties Is Allowed (With Safeguards)
Banks don’t have to manage everything in-house. They can partner with sub-custodians, but the OCC requires strict oversight. The OCC warns:
Banks are no longer required to obtain advance approval for each crypto-related activity. However, they remain subject to ongoing supervision and must document how they meet all relevant compliance standards.
The Fed Also Loosened Restrictions
This comes after the Federal Reserve decided to eliminate the advance notice for banks with an interest in the crypto space. The requirement for pre-approval for operating a stablecoin is also dead, which is indicative of the general relaxation of the policies surrounding cryptocurrencies.
