The Office of the Comptroller of the Currency (OCC) has dramatically simplified the regulatory landscape for banks looking to venture into cryptocurrency services. In a significant policy shift, the agency has removed the supervisory non-objection process that previously required banks to secure explicit approval before launching crypto-asset activities.
This regulatory overhaul means banks no longer face the bureaucratic hurdle of pre-approvals for cryptocurrency initiatives.
Instead, oversight has shifted to standard supervisory examinations—essentially moving from a “mother may I?” approach to a “show me how you did it” philosophy. Banks now have the autonomy to self-assess and maintain compliance while developing crypto offerings at their own pace.
The OCC has specifically affirmed several permissible crypto activities for national banks and federal savings associations. These include providing custody services for customers’ digital assets, offering crypto execution services, holding reserves for stablecoins, acting as nodes on distributed ledgers, and using third-party sub-custodians—all previously subject to restrictive oversight. Financial institutions will now need to evaluate various custody solutions to ensure both safety and security for their clients’ digital assets.
Perhaps most significantly, the OCC has rescinded Interpretive Letter 1179, which imposed stringent requirements under the Biden administration. Joint regulatory statements from 2023 that limited crypto activities have also been formally withdrawn, with the Federal Reserve and FDIC aligning with the OCC’s more permissive approach. The Federal Reserve Board has rescinded guidance requiring state member banks to provide advance notice for crypto-asset activities, effectively immediately removing separate notification requirements.
This doesn’t mean it’s a crypto free-for-all, though. Banks are still expected to implement robust risk management practices, especially when outsourcing custody roles. They must proactively identify and address risks unique to digital assets while maintaining compliance with applicable laws.
The OCC’s Interpretive Letter 1184 explicitly reaffirms banks’ authority to engage in crypto-asset custody and related services including cryptocurrency exchange, transaction settlement, and reporting functions.
The industry impact is expected to be substantial. With lower barriers to entry, banks can now move more quickly to launch crypto products, potentially accelerating innovation and enhancing their ability to compete with non-bank crypto service providers. However, some uncertainty remains regarding future guidance as the crypto landscape continues to evolve within traditional banking.
