The federal banking agencies continue to open the channels for regulated entities to engage in digital asset activities.
By Arthur S. Long, Parag Patel, Pia Naib, and Deric Behar
On May 7, 2025, the Office of the Comptroller of the Currency (OCC) published Interpretive Letter 1184 (a response to an inquiry from a regulated entity) affirming that national banks and federal savings associations (collectively, banks) may provide and outsource cryptocurrency custody and execution services on behalf of customers. This affirmation continues the work by the OCC and other federal banking regulators to dial back the restrictions placed on digital assets in the banking industry under the prior administration (for more information, see this Latham blog post and this blog post).
Interpretive Letter 1184 follows the March 7, 2025, Interpretive Letter 1183 which rescinded Biden-era Interpretive Letter 1179 (November 18, 2021). Interpretive Letter 1179 directed that the activities addressed in previous OCC interpretive letters (1170 addressing whether banks may provide cryptoasset custody services, 1172 regarding bank stablecoin reserve holding, and 1174 regarding banks acting as a node on a distributed ledger) were legally permissible, provided the bank could demonstrate, to the satisfaction of its supervisory office, that it had controls in place to conduct the activity in a safe and sound manner.
The OCC stated in Interpretive Letter 1183 that the permissibility of the activities described in Interpretive Letters 1170, 1172, and 1174 were reaffirmed, and that the supervisory nonobjection process described in Interpretive Letter 1179 “is no longer necessary.” (For more information, see this Latham blog post)
Interpretive Letter 1184 affirms the custody activities permitted in Interpretive Letter 1170, first published on July 22, 2020. Specifically, a bank may:
- provide cryptoasset custody services in a fiduciary or non-fiduciary capacity;
- outsource bank-permissible cryptoasset activities, including custody and execution services to third parties (e.g., a sub-custodian);
- buy and sell digital assets held in custody on a customer’s behalf at the direction of the customer and in a manner consistent with the customer agreement and applicable law;
- facilitate a customer’s cryptocurrency and fiat currency exchange transactions; and
- provide various crypto-related services such as transaction settlement, trade execution, recordkeeping, valuation, tax services, and reporting.
All crypto banking activities affirmed by the OCC must be conducted in a safe and sound manner, in compliance with applicable laws, and with proper risk management and controls in place (including appropriate third-party risk management practices).
Acting Comptroller of the Currency Rodney E. Hood reiterated this point in a May 8, 2025, speech covering the agency’s priorities, which included support for digital assets in the federal banking system. He stated, however, that the OCC “expect[s] banks to have the same strong risk management controls in place to support novel bank activities as they do for traditional ones.”
Follow this and other critical developments on Latham’s US Crypto Policy Tracker.