Banks can hold stablecoin-related assets for customers, OCC says

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WASHINGTON — The Office of the Comptroller of the Currency on Monday cleared national banks to hold stablecoin-related assets for customers, two months after the agency permitted institutions to provide custody services for cryptocurrency holders.

Stablecoins, a cryptocurrency typically pegged to a government currency, have been trumpeted as a viable and secure form of finance by acting Comptroller of the Currency Brian Brooks. Before coming to the OCC, Brooks served as chief legal officer of the cryptocurrency exchange Coinbase.

The OCC issued an interpretive letter signed by OCC Chief Counsel Jonathan Gould clarifying that national banks can place assets in reserve accounts that are tied to stablecoins in a "hosted wallet." A hosted wallet typically refers to a kind of cryptocurrency account that is safeguarded by a third party.

“National banks and federal savings associations currently engage in stablecoin related activities involving billions of dollars each day,” Brooks said in a statement. “This opinion provides greater regulatory certainty for banks within the federal banking system to provide those client services in a safe and sound manner.”

Gould wrote that "stablecoin issuers may desire to place assets in a reserve account with a national bank to provide assurance that the issuer has sufficient assets backing the stablecoin in situations where there is a hosted wallet."

“[W]e conclude that a national bank may hold such stablecoin ‘reserves’ as a service to bank customers,” he wrote.

The letter explicitly does not address the implications involving “un-hosted” wallets, which are typically controlled individuals, rather than institutions.

An interpretive letter issued by the OCC in July cleared national banks to hold hosted wallets on behalf of customers. In the letter Monday, Gould wrote, "Banks may receive deposits from stablecoin issuers, including deposits that constitute reserves for a stablecoin associated with hosted wallets."

“In connection with these activities, a national bank may also engage in any activity incidental to receiving deposits from stablecoin issuers,” Gould wrote. “As with any deposit product, a national bank or [federal savings association] that accepts reserve accounts should be aware of the laws and regulations relating to deposit insurance coverage, including deposit insurance limits, and the requirements for deposit insurance to ‘pass through’ to an underlying depositor, if applicable.”

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Digital currencies OCC Cryptocurrencies Brian Brooks Mobile wallets Regulatory guidance