US Banks Cleared For ‘Riskless’ Crypto Transactions Following OCC Letter

bitcoinistPublished on 2025-12-09Last updated on 2025-12-09

Abstract

In a major breakthrough for the U.S. digital asset industry, the Office of the Comptroller of the Currency (OCC) has announced that national banks are now permitted to engage in "riskless principal transactions" involving cryptocurrencies. This guidance, detailed in Interpretive Letter 1188, allows banks to buy and sell crypto-assets for custody customers based on their directions, aligning with existing custody services. The OCC emphasized that banks must conduct these activities in a safe, sound manner and in compliance with applicable law, with oversight included in its supervisory process. This move provides a more regulated environment for crypto transactions compared to external exchanges.

In a new major breakthrough for the digital asset industry in the United States, the Office of the Comptroller of the Currency (OCC) announced on Tuesday that national banks are permitted to engage in “riskless principal transactions” involving crypto-assets.

This confirmation comes through the issuance of Interpretive Letter 1188, which outlines the guidelines for such activities.

OCC’s New Framework

According to the OCC’s guidance, acting as a riskless principal for crypto-assets aligns with the services that national banks already offer to custody customers.

National banks are now allowed to buy and sell both financial and non-financial assets held in custody based on customer directions, adhering to existing agreements and legal requirements.

Therefore, facilitating the buying and selling of digital assets for custody customers in a riskless principal capacity is essentially the same as acting as an agent for those customers, and it is acknowledged as a legitimate banking activity.

This new framework means that customers can transact in crypto-assets through established national banks, providing a more regulated environment compared to exchanges that operate outside the purview of strict financial oversight.

Key Concern For Banks In Crypto Transactions

The OCC also distinguished between riskless principal transactions in digital assets and those in traditional securities. The primary differences lie in the underlying assets and the technology used to facilitate these transactions.

The main concern associated with riskless principal transactions is counterparty credit risk, especially settlement risk. Similarly, in customer-driven, perfectly matched derivative transactions that utilize transitory title transfer, credit risk is the predominant factor. In the letter, the OCC concluded the following:

As with any activity, a bank that conducts riskless principal crypto-asset transactions must do so in a safe and sound manner and in compliance with applicable law. The OCC will examine riskless principal crypto-asset activities as part of its ongoing supervisory process.

The daily chart shows the total crypto market cap recovery toward $3.18 trillion. Source: TOTAL on TradingView.com

Featured image from DALL-E, chart from TradingView.com

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