OCC Approves Crypto-Asset Custody: How Banks Can Now Secure Billions in Digital Assets

The Office of the Comptroller of the Currency (OCC) has issued new guidance allowing federally regulated banks to provide crypto-asset custody services without prior approval. This is a shift from earlier policies that necessitated banks to notify regulators before offering crypto-related services. Active Comptroller Rodney Hood reiterated that banks are required to have strong risk management controls in place to ease these new activities.

OCC Provides Crypto-Asset Custody Greenlight for Banks

The OCC’s interpretative letter 1183 explains that national banks and federal savings associations are now authorized to conduct three major cryptocurrency activities.

• They can securely store customers’ digital assets. 
• They can have stablecoin reserve policies, such as maintaining deposits backing stablecoin reserves. 
• They can act as validation nodes on distributed ledger networks, i.e., validate cryptocurrency transactions.

Those operations had before prompted banks to get regulatory comments and approval, but the OCC has now refused that requirement. According to the regulator, this step is related to the increased use of digital assets and the need for banking institutions to engage in services within the crypto industry. Nevertheless, the OCC demands that banks should maintain high-security standards, risk management controls, and compliance.

OCC’s Move Aligns With Federal Shift on Crypto Banking

The new directive is a change in the federal government’s approach toward cryptocurrencies. The OCC had previously joined the Federal Reserve (Fed) and Federal Deposit Insurance Corporation (FDIC) in warning banks against participating in crypto-related business in early 2023. The OCC, though, has revisited its affirmation of the banking sector’s entry into the space, given that risk management control measures are in place.

Treasury Secretary Scott Bessent emphasized working together with the OCC to revoke restrictive policies that had formerly slowed the industry. In the meantime, the Fed and the FDIC have not issued new guidance on cryptocurrency banking regulations.

OCC’s New Crypto Policy and Its Impact

The most recent OCC announcement eliminates red tape for banks participating in custody activities, but it does not stop regulatory requirements. Banks still must comply with severe risk management measures, a paramount requirement reinforced by the OCC. This entails keeping them adequately fortified with security platforms, anti-money laundering measures, and protocols in place to secure customers against online attacks and money laundering.

Rodney Hood, acting comptroller, said these regulatory changes ensure that cryptocurrency banking regulations are subject to the same cautious treatment accorded to conventional banking activities. 

OCC’s Twitter Announcement Clarifies Crypto Regulations for Banks

The OCC confirmed its position again through its official Twitter account on March 8, declaring that crypto-asset custody, stablecoin reserve policies, and payment facilitation based on blockchain are permissible within the federal banking system. 

The OCC reaffirmed that crypto-asset custody, holding deposits that serve as reserves backing stablecoins, & the use of distributed ledger technology & stablecoins to facilitate permissible payments activities are permissible in the federal banking system. https://t.co/ifOdvjzEYJ pic.twitter.com/t7AXenXix3

— OCC (@USOCC) March 7, 2025

The tweet also made it clear that banks need not get approval beforehand but must adhere to risk management control procedures. This public announcement comes in line with the regulatory agency’s efforts to advance banking to keep up with technological improvements.

OCC’s Crypto Move: What’s Next for Banks?

The OCC’s recent interpretative letter is an important shift in cryptocurrency regulations that allows banks to engage in such activities without prior approval. Although this step takes away a huge regulatory hurdle, banks will still need to have robust risk management controls in place to determine compliance and safety. The effect of this policy shift can be massive, with an increase in the number of banks joining the crypto space and driving the use of digital currencies on a large scale within mainstream banking.