The Office of the Comptroller of the Currency confirms that national banks may keep cryptocurrencies on their balance sheets for network fees and experimentation.
On November 18, the U.S. Office of the Comptroller of the Currency (OCC) confirmed, through an interpretive letter, that major banking institutions are officially authorized to hold cryptocurrencies on their balance sheets to pay network fees on blockchains as part of “otherwise permissible” banking activities. According to the regulator, national banks may also hold and use digital assets to test crypto-related platforms.
“Permitting the bank to engage in the proposed activities enables it merely to expand… pre-existing permissible activity without having to expend resources or expose itself to operational and counterparty risks associated with acquiring the necessary crypto-assets from a third party,” said Adam Cohen, senior deputy comptroller chief counsel at the OCC.
A shift from the Biden era
During the Biden administration, the OCC adopted a far more cautious approach toward cryptocurrencies, requiring national banks to obtain the regulator’s approval before engaging in most crypto-related activities.
At the time, other banking regulators – including the FDIC – discouraged federally chartered banks from participating in certain crypto activities deemed too risky, including the use of public blockchain networks such as Ethereum.
The Trump administration has moved to dismantle those restrictive policies. Last March, the OCC repealed the Biden-era policy requiring national banks to obtain regulatory approval before engaging in crypto activities. It also authorized major banking institutions to custody digital assets for their clients and to participate in certain stablecoin-related activities.
The OCC’s announcement gives national banks explicit permission to hold cryptocurrencies on their balance sheets for multiple purposes. Banks can now experiment more freely with blockchain technologies, maintaining the digital assets needed to operate on those networks.
