OCC Permits Banks Riskless Principal Crypto Trades

The Office of the Comptroller of the Currency confirmed on December 9 that national banks in the United States may conduct riskless principal transactions in certain cryptoassets, including Bitcoin, Ethereum, XRP, and Solana, marking a significant step toward integrating digital assets into traditional banking activities.

In Interpretive Letter 1188, the OCC stated that banks can purchase cryptoassets and immediately resell them to customers without taking on market exposure or holding the assets on their balance sheets. This approach treats such brokerage as an extension of existing services, similar to how banks facilitate trades in other financial and nonfinancial assets held in custody. Banks must execute these transactions based on customer instructions, adhering to agreements and legal requirements, while managing risks such as counterparty credit and settlement issues in a safe and sound manner. The OCC emphasized that it will supervise these activities as part of its routine oversight process.

The guidance aligns crypto brokerage with established banking functions, allowing institutions to offer direct execution services without relying on external or offshore platforms....