The Office of the Comptroller of the Currency (OCC) is requiring national banks and federal savings associations to demonstrate that they have adequate controls in place before they can engage in certain cryptocurrency, distributed ledger, and stablecoin activities.
Acting Comptroller Michael J. Hsu stated in a letter that banks can engage in these activities after they receive written notification of the supervisory office’s non-objection.
“Today’s letter reaffirms the primacy of safety and soundness. Providing this clarity will help ensure that these cryptocurrency, distributed ledger, and stablecoin activities will be conducted by national banks and federal savings associations in a safe and sound manner,” Hsu said. “Because many of these technologies and products present novel risks, banks must be able to demonstrate that they have appropriate risk management systems and controls in place to conduct them safely. This will provide assurance that crypto-asset activities taking place inside of the federal regulatory perimeter are being conducted responsibly.”
Further, the letter provides a roadmap for banks to engage with their supervisory office to provide written notification of their proposed activities. In addition, it outlines the criteria that the OCC will follow to evaluate the proposed activity and provide a supervisory non-objection. If the bank receives a supervisory non-objection, the OCC will review these activities as part of its ordinary supervisory processes.