Key Takeaways
- The OCC has confirmed that national banks can execute riskless principal crypto trades, acting as intermediaries without taking crypto onto their own balance sheets.
- Under Interpretive Letter No. 1188, this allows banks to facilitate offsetting customer trades in crypto while avoiding inventory risk.
The Office of the Comptroller of the Currency (OCC) confirmed today that national banks can execute riskless principal crypto trades, allowing financial institutions to facilitate digital asset transactions without assuming inventory risk.
Under Interpretive Letter No. 1188, banks can act as intermediaries to match and execute offsetting trades between customers in the crypto market without retaining any assets on their balance sheets. This approach enables banks to facilitate crypto transactions while maintaining regulatory compliance.
The guidance represents part of the OCC’s efforts to clarify the role of banks in digital assets. The regulator has issued recent guidance confirming national banks’ authority to engage in various crypto activities, provided they maintain safe and sound practices.
The OCC has emphasized that banks can participate in crypto custody and related services without prior supervisory non-objection, encouraging responsible innovation in the digital asset space.
Source: https://cryptobriefing.com/occ-banks-riskless-principal-crypto-trades/
