The U.S. Office of the Comptroller of the Currency has confirmed that banks can carry out cryptocurrency transactions as primary intermediaries without incurring risks and without the need for prior approval, in a move that reflects a new regulatory shift to integrate the traditional financial sector with digital asset markets.
Key Points
The new OCC directive allows banks to execute buy and sell transactions of cryptocurrencies simultaneously with very limited financial exposure on their balance sheets.
This shift came after similar actions by the Federal Reserve and the FDIC to include cryptocurrency activities within traditional banking oversight.
The Trump administration supported expanding banks' participation in digital assets, while critics warned of the potential transfer of financial system risks to the banking sector.
A U.S. regulatory body confirmed that banks can act as intermediaries in cryptocurrency transactions under a 'risk-free principal broker' system, bringing them closer to a role similar to brokerage firms within the digital asset market.
In this type of transaction, the bank buys cryptocurrencies from one party and immediately sells them to another party, without holding a real exposure on its balance sheet except in very limited circumstances.
The Office of the Comptroller of the Currency reminded that these activities will not be treated as new or risky, alleviating a regulatory layer that hindered banks' participation in crypto flows. This change aims to narrow the gap between traditional finance and the infrastructure for trading digital assets while keeping risks within a level deemed manageable by regulators, according to Reuters.
Part of a broad regulatory shift in U.S. oversight policy
The new position is based on previous guidance from the Office of the Comptroller of the Currency allowing national banks to provide digital asset custody services, engage with stablecoins, and participate in distributed ledger networks without needing prior approval for each activity. In March, the office officially eliminated the prior approval requirements for several crypto operations, signaling a clear shift from the cautious approach that prevailed after market disruptions in 2022 and 2023.
Other regulatory bodies have taken a similar path. In March, the Federal Deposit Insurance Corporation announced that the banks under its jurisdiction were no longer required to seek prior approval to conduct certain cryptocurrency activities, provided they manage risks according to standard supervisory guidelines. These steps helped remove procedural barriers that had kept regulated financial institutions away from the crypto market for years.
The Federal Reserve has also restructured its approach, abolishing the supervisory program for new crypto-related activities and emerging technologies, integrating oversight into traditional supervisory mechanisms. The central bank stated that it has gained sufficient understanding of the risks of digital assets to allow for the use of standard oversight tools instead of treating them as exceptional cases.
Meanwhile, Congress is moving forward with broader legislation to regulate market infrastructure and stablecoins under the GENIUS Act, while high-level policy documents focus on enhancing regulatory clarity rather than relying on a punitive approach. This climate has encouraged large institutions like PNC and SoFi Bank to launch or expand trading and custody services, increasing pressure on regulators to align rules with the growing demand within the market.
The Trump administration's support for the cryptocurrency sector
President Donald Trump is adopting a more supportive stance towards digital assets, considering the latest step from the Office of the Comptroller of the Currency as part of efforts to bridge the gap between traditional finance and the cryptocurrency market. Trump is working on an executive order under review that imposes penalties on banks that discriminate against cryptocurrency companies, limiting the ability of major institutions to disrupt the flow of money linked to digital asset activities.
Finally, advisors close to the administration see these steps as necessary to keep crypto innovation within the United States and under its regulatory oversight. However, critics warn that deeper ties between banks and the volatile cryptocurrency market could transmit shocks to the heart of the financial system if risk controls do not evolve at the required pace. #Write2Earn
