- Banks can now process stablecoins, crypto custody and distributed ledgers
- Marktwijkers believe that this is a huge and long tail wind update for the sector
American banks are now free to carry out certain crypto activities, including custody of digital assets for customers, Stablecoin payments or the implementation of blockchain nodes.
The clarification came from the OCC (Office of the Comptroller of Currency), an agency imposed to supervise noise and safe activities of banks and savings associations.
Rodney E. Wood, an Exec at OCC, stated”
“Today’s action will reduce the burden for banks to enter into crypto-related activities and to ensure that these banking activities are treated consistently by the OCC, regardless of the underlying technology.”
The agency has also withdrawn earlier guidelines that have chosen crypto as a liquidity risk for the banking system.
Market reactions
Respond to the update, Jeremy Allaire, founder of Circle (USDC), said”
“Banks use USDC. Soon to a blockchain near you. We are enthusiastic about wiring the existing financial system for the new financial system of the internet. “
The previously coordinated bank restriction, known as ‘Operation ChokePoint 2.0’, drove crypto de-banking and blocked banks to participate in the sector. Interestingly, the update is consistent with the pro-Crypto shift under the new Trump administration.
Apart from the OCC, a comparable pro-crypto position has been seen in the SEC and the FDIC (Federal Deposit and Insurance Corporation) lately. Alexander Grieve, head of government affairs in paradigm, repeated the same sentiment. He stated“
“OCC approves earlier guidelines that do not carry out crypto activities. Goodbye, Operation ChokePoint 2.0. “
For his part, Market Watcher Marty Party noted that the guidance would enable top chains to move trillions of dollars (stablecoins) for banks. He claimed This could purchase Ripple’s check on rails bank sheets.
“This also gives Ripple’s $ XRP effort to monopolize the bank sheet rails. Win-win. Huge new. “
That said, the move reinforces the increasing acceptance of blockchain and stablecoins in traditional financial systems. Some top banks such as JPMorgan, Goldman Sachs and Bny Mellon look at Crypto offers, including custody for the American place Bitcoin [BTC] ETFS – A direct competition for coinbase.