The New Path of the US Banking System in Crypto Trading: The OCC Offers Clear Guidance

In December 9, the Office of the Comptroller of the Currency laid out a critical new framework for the industry. Through Interpretive Letter 1188, the organization recognized that national banks can act as intermediaries in cryptocurrency transactions without the need to maintain large digital asset holdings. This approach is known as the “riskless principal” model—where the bank buys from a client and immediately sells to another, avoiding balance sheet exposure.

This endorsement is no accident. A day before the official release, Comptroller Jonathan Gould spoke to industry leaders and shared his perspective. He stated that digital assets should not be treated as a wholly unique category under banking law. Instead, they should be supported using existing regulatory structures designed for brokerage, custody, and fiduciary services. This point directly responds to the long-standing campaign by the Bank Policy Institute, which promised to block more trust charters from being granted to crypto firms.

Why the Definition of “Trust Charter” Matters

For industry entrepreneurs, the concept of a “trust charter” may seem like an abstract legal detail. But it is the key to how cryptocurrency companies can thrive within the US regulatory framework.

A national trust bank charter is a specialized license allowing institutions to offer fiduciary and asset safekeeping services without needing to accept traditional deposits or support the full suite of commercial banking operations. This means the parent company can remain outside the more intensive supervision of a traditional holding company.

For cryptocurrency custody providers and stablecoin issuers, the appeal is clear: they can operate in a lighter regulatory environment while still obtaining a federal charter and nationwide banking authority. The BPI, representing traditional institutions, warned that this approach is a loophole that could permit large crypto platforms to hold substantial reserves and settlement flows without full compliance burdens of commercial banks.

Gould’s response was direct: technology should not be a barrier. If the banking system has accepted electronic custody and book-entry securities for decades, why should cryptographic tokens on distributed ledgers be considered fundamentally different? This logic forms the foundation of Interpretive Letter 1188.

Practical Impact on Banking Operations

The interpretive letter offers a concrete pathway for banks wishing to expand into crypto trading without incurring large direct exposures.

A bank could buy Bitcoin from an institutional investor and sell it to another client in just seconds. The two transactions could be structured to be perfectly offset—where the bank profits from the spread but has no net position in the asset itself. For securities-classified cryptocurrencies, this approach aligns with long-standing agreements under Section 24 of the National Bank Act. For other digital assets, the letter provides a detailed legal analysis covering a four-factor test, ensuring that the activity remains part of the “business of banking.”

On practical levels, this means large financial institutions can develop customer-facing crypto trading platforms with direct integration into their core banking operations. There’s no longer a need to rely on loosely affiliated subsidiaries or allow specialized exchanges to conduct business without institutional banking connections.

For stablecoin issuers, the implications are equally significant. A national trust bank can hold reserve funds on an OCC-supervised balance sheet, removing counterparty risk associated with third-party custodians. Payment flows can be routed through Federal Reserve-connected correspondent banking networks, providing settlement finality and regulatory clarity that are difficult to achieve through international arrangements.

Global Implications Across Continents

Decisions made in Washington have ripple effects worldwide. Major international banks operating across multiple continents regularly assess the US regulatory pathway before developing new business lines. If the OCC permits riskless principal crypto routing for Bitcoin and Ethereum under clear supervision, global clients can expect the same services in London, Frankfurt, Tokyo, and other international financial centers.

Similarly, if the agency begins granting multiple national trust charters to digital-asset firms passing rigorous examination standards, it will present a competing model to the traditional offshore-exchange-plus-local-payment-partner structure that has been the norm for the past decade. This shift could influence how other jurisdictions shape their own regulatory frameworks.

The critical point is not merely allowing crypto in the banking system. It is about integrating cryptocurrency business into the old categories of banking activity: brokerage, custody, and fiduciary management. By describing crypto services using terms with existing regulatory precedent, the OCC is building a bridge rather than creating a new world.

Remaining Barriers

Although our message from the OCC is positive, the charter approval process remains rigorous. The Bank Policy Institute and other traditional banking voices continue to submit detailed comments on specific applicants, raising questions about consumer protection records, reputational risk, and ownership clarity.

The OCC charter manual requires all limited-purpose trust banks to meet the same core standards for capital, management quality, risk control, and community benefit as any full national bank. The regulator’s discretion is broad, and it has the authority to impose specialized conditions on capital requirements, liquidity buffers, and operational standards for any approval.

This means that the real gating factors are not headline policy speeches but the detailed examination teams and supervisory agreements that follow. Crypto firms serious about obtaining a charter should be prepared to support thorough due diligence and ongoing regulatory engagement.

The Way Forward: Clarity Rather Than an Open Door

The most important aspect of the OCC’s recent moves is not the opening of all doors for crypto banking. It did not happen—and it will not be simple. Instead, the primary regulator has begun articulating concrete regulatory anchors where crypto business can become part of the traditional banking framework.

Riskless principal trading is presented as an extension of recognized brokerage activities. Custody is introduced as a modern version of the centuries-old safekeeping function. Trust charters have become homes for fiduciary and reserve management that clearly integrate into banking law.

In an industry where regulatory uncertainty is the main business risk, this gradual clarification can be as valuable as any new statute. Crypto firms serious about accessing US institutional capital now have a clearer picture of what needs to be done. Traditional banks hesitant to enter will see clearer boundaries where their supervisors are willing to operate.

The speed of execution—how quickly these commitments can be justified in actual applications and approvals—will determine whether the OCC’s recent moves mark the beginning of a new era in bank-integrated crypto infrastructure or a mere interlude in a longer history of regulatory deliberation.