The Office of the Comptroller of the Currency (OCC) has affirmed national banks’ authority to engage in cryptocurrency custody and execution services with its latest regulatory clarification, issued on May 7, 2025.
This decision could significantly boost institutional involvement in the cryptocurrency sector, providing regulatory clarity that encourages traditional banks to develop cryptocurrency services.
OCC Grants Banks Crypto Custody Permission
The Office of the Comptroller of the Currency (OCC) has issued an interpretive letter confirming the authority of banks to engage in cryptocurrency custody services. This action signals a shift in regulatory stance. With Interpretive Letter 1184, the OCC permits national banks to provide and outsource cryptocurrency custody and execution services. This marks a change from previous policies that imposed restrictions.
New Revenue Streams Open for Banks
The OCC’s decision is likely to increase institutional involvement in the crypto market. Banks can potentially explore new revenue streams through cryptocurrency services, thereby expanding the traditional financial ecosystem. The clarification could lead to a broadening of crypto custody services, with banks emphasizing safe practices. This aligns with historical patterns in which regulatory clarity generally stimulates market adoption.
“This action reflects a significant shift in the regulatory environment, aiming to foster innovation while maintaining compliance with applicable laws.” — Parag Patel, Partner, Latham & Watkins
U.S. Crypto Regulation Mirrors 2021 Policy Changes
The OCC’s actions mirror previous shifts, such as the 2021 policy rescindment under the Biden administration. Historically, regulatory changes in the crypto sector have fostered greater industry acceptance. New OCC news release nr-occ-2025-42 highlights these shifts. Kanalcoin experts highlight that similar regulatory changes have historically paved the way for technological advancements. Enhanced regulatory clarity typically encourages market stabilization and adoption, supporting potential growth within the sector.
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