This week, the US supervisory authority, Office of Comptroller of the Currency (OCC), announced in an open letter that nationally licensed banks are allowed to offer custody services for crypto-currencies.

The regulatory environment in the United States regarding the provision of trading and services in digital assets is not uniformly regulated. The legal situation is unclear. US banks then wanted to obtain more detailed information from the U.S. Office of the Comptroller of the Currency (OCC) about the rules governing the safekeeping of crypto-currencies. This resulted in the public letter in which this was explicitly approved.

“The provision of custody services for crypto-currencies falls within the remit of long-established authorities dealing with custody and custody activities. As will be discussed below, this is a permissible form of traditional banking activity which the National Banks are authorised to carry out by electronic means. The provision of such services is permitted both in a fiduciary and a non-trustee capacity. A bank offering the custody of crypto-currencies in a non-fiduciary capacity would essentially hold in safe custody the cryptographic key which enables the control and transfer of the customer’s crypto-currency”. Excerpt of open letter from the OCC

Furthermore, the authority notes that banks do not keep the digital assets per se, but only the keys with which they can be transferred on the block chain. So-called cold wallets would be best suited for this purpose, as they are not connected to the Internet and are therefore more likely to be protected against hacker attacks.

The “Office of the Comptroller of the Currency” is an independent authority within the United States Department of the Treasury, which was established by the National Currency Act of 1863 and serves to regulate and monitor all national banks and savings institutions in the United States.

Landmark decision

This decision is a significant development for the crypto industry. Previously, the safekeeping of crypto-currencies in the United States was reserved for specialized companies with special authorizations. However, these usually required a federal license to provide these services. Now the US banking sector can enter this area.

The rationale for the OCC’s move is explained in the public letter by the fact that as financial markets become increasingly technological, there is likely to be a greater need for banks and other service providers to use new technologies and innovative ways to provide traditional services on behalf of clients.

It also stresses the importance of keeping crypto-currencies in line with sound risk management practices. They should also be linked to the Bank’s general terms and conditions and existing policies.

The message is likely to be one of the most significant for the crypto sector this year. In Germany, a law has already been in place since the end of November 2019 that allows banks to store digital currencies for their customers.

*Originally published in German at

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