The U.S. Office of the Comptroller of the Currency (OCC) on Monday published a letter clarifying that national banks and federal savings associations can now hold reserves for stablecoin issuers in the country.
According to the OCC’s interpretive letter, reserve accounts can either be funded through deposits from stablecoin issuers or deposits from individual stablecoin holders.
It stressed that banks can hold such reserves provided that ”the issuer has sufficient assets backing the stablecoin in situations where there is a hosted wallet.” The letter responds to questions regarding the application of stablecoin-related bank activities. It says:
As the OCC recently reaffirmed, national banks may provide permissible banking services to any lawful business they choose, including cryptocurrency businesses, so long as they effectively manage the risks and comply with applicable law, including those relating to the [Bank Secrecy Act] and anti-money laundering.
Stablecoins are cryptocurrencies underpinned by another asset such as a commodity or fiat currency like the U.S. dollar. They are designed to minimize the impact of price volatility. Tether (USDT) is the most widely used stablecoin worldwide. Others include USD Coin and DAI.
In a statement, Acting Comptroller of the Currency Brian Brooks noted that federally chartered banks are “currently engaged in stablecoin related activities involving billions of dollars each day.”
“This opinion provides greater regulatory certainty for banks within the federal banking system to provide those client services in a safe and sound manner,” he stated.
Jeremy Allaire, chief executive officer of Circle, issuers of the USDC stablecoin, said the new OCC guidance represents significant progress for the advancement of digital dollar stablecoins in the U.S. financial system.
“With this clarity…fintech firms and banks can have more confidence in building on this innovation, while also ensuring that the guardrails and risk…