T Skevington and M Bacina
US Currency Comptroller clarifies banks can provide digital currency custody to customers
The United States Office of the Comptroller of the Currency (OCC) has published an interpretive letter explicitly confirming that national banks' and federal savings associations' authority to provide cryptocurrency custody services for customers.
The clarification comes in the form of an interpretive letter, issued in response to an anonymous request "regarding the authority of a national bank to provide cryptocurrency custody services for customers."
The letter goes to significant detail in considering the risks of banks providing digital asset custody services, including suggestions that:
Different cryptocurrencies may also be subject to different OCC regulations and guidance outside of the custody context, as well as non-OCC regulations. A national bank should consult with OCC supervisors as appropriate prior to engaging in cryptocurrency custody activities.
Acting Comptroller of the Currency Brian P. Brooks commented generally that the interpretive letter:
clarifies that banks can continue satisfying their customers' needs for safeguarding their most valuable assets, which today for tens of millions of Americans includes cryptocurrency
The OCC notes that the clarification is hardly revolutionary, with the OCC has previously specifically recognised the importance of digital assets and the authority for banks to provide safekeeping for such assets since 1998. Further, the interpretive letter cites existing OCC guidance regarding unique or electronic assets which outlines that:
banks may hold a wide variety of assets as custodians, including assets that are unique and hard to value. These custody activities often include assets that transfer electronically.
Brooks only recently joined the OCC as Acting Comptroller, after leaving his previous position as Chief Legal Officer at global digital asset exchange Coinbase.
Hopefully, Brooks continues to use the platform to advocate for and enable modernisation of the banking and financial system in the US - and inspires other countries (perhaps Australia?) to follow suit.