Simply put
- The OCC has confirmed that banks can now hold and utilize virtual currencies, even for paying blockchain network fees tied to authorized banking activities.
- Additionally, banks are permitted to hold digital assets for testing purposes related to cryptocurrency platforms, rolling back some restrictions from the Biden administration.
- This policy supports a prior initiative from the Trump administration to transition more traditional banking actions onto blockchain networks.
The chief banking regulator has officially authorized national banks to hold and utilize virtual currencies in specific scenarios.
The Office of the Comptroller of the Currency (OCC) made this announcement on Tuesday, stating that major banks can now include cryptocurrencies on their balance sheets to cover network fees for “otherwise permissible” banking tasks.
According to the OCC, national banks may also hold and use digital assets to experiment with cryptocurrency-related platforms.
“By permitting banks to engage in these activities, it allows them to expand their existing operations without needing to acquire crypto assets from outside parties, which carries risks,” noted Adam Cohen, the OCC’s chief deputy auditor, in a letter supporting the new guidelines.
Under the Biden administration, there has been a more cautious stance regarding cryptocurrencies, requiring national banks to secure regulatory approval before participating in most crypto-related endeavors.
At that time, other regulators, such as the FDIC, advised federally chartered banks to avoid specific cryptocurrency activities, labeling them as overly risky—particularly with public, permissionless blockchain networks like Ethereum, where activities are not overseen by any administrators.
Conversely, the Trump administration, which has been more favorable toward virtual currencies, took steps this year to dismantle those restrictions. In March, the OCC rescinded a Biden-era policy that mandated national banks receive regulatory approval before engaging in crypto activities and sanctioned major banks to store crypto assets for clients while also participating in certain stablecoin operations.
This recent announcement extends the previous changes by explicitly allowing national banks to hold cryptocurrencies on their balance sheets for various purposes. This move potentially brings the largest U.S. banks closer to integrating conventional banking functions onto blockchain and enhancing their participation in the cryptocurrency market.
