U.S. banks granted green light for safekeeping of customer crypto assets by OCC
Banks Can Now Officially Crypto Without Catch
Your local bank just got a fresh update - they can now deal with cryptocurrencies like it's no big deal!
According to recent news, national banks and federal savings associations can buy, sell, and do pretty much everything crypto-related at your command. They can even outsource these services to third parties if they need some extra help.
Crypto Services, Protected by Law (Kind Of)
Thanks to the Office of the Comptroller of the Currency (OCC), banks can provide a whole range of crypto services, including asset settlement, trade execution, recordkeeping, valuation, and even tax reporting, as long as they follow the law and your customer agreement.
The OCC also reaffirmed that crypto custody is just a fancy modern version of traditional bank custody services. So, don't be surprised if your bank partners with a sub-custodian to store and manage your crypto assets securely. But remember, banks gotta take strong risk management steps when they do that.
Third-party providers must follow some strict controls to protect your assets. Banks are responsible for overseeing all outsourced services, especially when they act as a fiduciary. In that case, they're bound by federal fiduciary rules.
All crypto-related activities must be conducted in a safe, sound, and legal manner, whether it's handled directly by the bank or with the help of a third party.
The Green Light for Crypto Adoption
The OCC's announcement gives banks a clear legal basis to offer digital asset services within a regulated framework. Previously, it was a bit fuzzy if banks could actively buy or sell crypto assets based on customer instructions, while custody was already allowed.
This clarity could boost confidence in crypto services provided by regulated financial institutions. It also lets banks cater to the growing crypto demand without having to build everything in-house.
The OCC's move supports responsible crypto adoption in traditional banking and reinforces the need for customer protection and oversight. Banks can now expand their crypto services as long as they manage partners and risks effectively.
Resources to Learn More
- eToro - Investment platform that offers cryptocurrencies
- YouHodler - Cryptocurrency lending and savings platform
- Wirex - Multi-currency wallet and debit card provider
- NEXO - Cryptocurrency lending platform with instant access to loans
- Arkham - A DeFi smart contract platform that focuses on privacy and security
Disclaimer
This article aims to provide accurate and timely information. However, readers are advised to independently verify facts and consult with a professional before making any decisions based on this content. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
Sources
- OCC Crypto Letter
- OCC Crypto FAQs
- OCC Custody Services Risk Management
- OCC Stablecoins Letter
- OCC Distributed Ledger Technology Letter
- Banks are now able to provide a variety of crypto services such as asset settlement, trade execution, recordkeeping, valuation, and tax reporting, thanks to the Office of the Comptroller of the Currency (OCC).
- Crypto custody is considered by the OCC to be similar to traditional bank custody services, meaning banks may partner with sub-custodians to securely store and manage digital assets.
- Third-party providers of crypto services must adhere to stringent controls to protect customers' assets, and banks are responsible for overseeing all outsourced services, particularly when they function as a fiduciary.
- All crypto-related activities must be carried out safely, soundly, and legally, whether performed directly by the bank or with the help of a third party.
- The OCC's announcement provides banks with a clear legal basis to offer digital asset services within a regulated framework, potentially boosting confidence in crypto services offered by regulated financial institutions and facilitating responsible crypto adoption in traditional banking.
- Both banks and customers benefit from regulatory guidance on crypto-related services, as it reinforces the importance of customer protection and oversight, enabling banks to cater to growing demand for crypto services without building everything in-house.
