US Banks Greenlighted for Crypto Activities as OCC Lifts Restrictions Stocks Surge

The Office of the Comptroller of the Currency (OCC) has made a significant policy shift, allowing US banks to engage in cryptocurrency activities without prior regulatory approval. This move aligns with the Trump administration's pro-crypto stance and contrasts with the Biden administration's more restrictive approach. The acting comptroller, Rodney Hood, emphasized that while banks will still need to manage risks, they will no longer face regulatory prohibitions on providing crypto services. This change aims to provide consistent treatment of crypto activities, regardless of the technology involved.

This policy shift follows long-standing calls from crypto companies for regulatory clarity. Coinbase, for instance, has been advocating for banks to offer crypto custody and trading services. The OCC's decision is seen as a step towards providing a clear rulebook for banks and crypto companies, rather than constantly changing guidelines. The move also comes as the US Securities and Exchange Commission (SEC) under Mark Uyeda adopts a more crypto-friendly approach, dismissing lawsuits against leading crypto firms like Kraken and OpenSea, and ending its court battle with Coinbase.

The OCC's ruling is expected to pave the way for increased institutional adoption of cryptocurrencies. However, the long-term impact will depend on how banks and regulators navigate the evolving landscape of financial innovation. Banks will still need to manage risks and adapt to changing demands, but the removal of regulatory barriers is a significant step forward. The industry awaits with anticipation to see how large financial institutions will respond to this new regulatory environment, balancing the potential benefits of crypto integration with the challenges of legality and market unpredictability.