The Office of the Comptroller of the Currency (“OCC”) issued a letter (1179) that national banks and federal savings associations must demonstrate that they have adequate controls in place before they can engage in cryptocurrency, distributed ledger, and stablecoin activities.
The OCC had issued multiple Interpretive Letters in 2020 and earlier this year related to this matter. The letters may be accessed directly here:
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Always committed to the safety and soundness of financial institutions, in the letter, the OCC clarified that cryptocurrency, distributed ledger, and stablecoin activities addressed may be conducted after a bank notifies its supervisory office of its intent to engage in the activities.
Once a non-objection letter has been obtained from its supervisory office, the bank may begin the activities. The OCC will review new activities and risks as part of its normal bank examination processes and procedures.
Particularly relevant to banks with personal and corporate trust departments, Letter 1179 reiterated that OCC Interpretive Letter 1176 on the OCC’s chartering authority did not expand on or change a bank’s existing obligations under the OCC’s fiduciary activities regulations. The OCC retained discretion in determining whether an activity is conducted in a fiduciary capacity for purposes of federal law.
If your organization is interested in building capabilities and solutions to support cryptocurrencies, don’t hesitate to reach out to learn how we can help.