The OCC is redefining and expanding crypto banking options
The intersection of the tokenized asset space and the TradFi sector has continued to accelerate and evolve rapidly as the calendar moves through 2025. Notable events that have occurred – and have realistically overshadowed some technical releases from the OCC – include the forming of a strategic bitcoin reserve, announcing plans to amend tax treatment for cryptoassets, and a complete overhaul of crypto policy at the SEC. That said the OCC remains an powerful banking regulator in the United States, and in essence serves as the gatekeeper for which institutions in the banking sector can engage in certain activities. Banking activities and institutions, unlike the fast moving and quickly growing fintech sector, have a clearly defined regulatory structure, established processes for engaging with said regulators, but have also been among those clamoring for increased regulatory guidance as the marketplace pivots to an increasingly pro-crypto position.
The publication that has attracted such attention in recent days actually can be traced back to a 2020 publication, titled Interpretative Letter 1170, which addressed the authority and manner in which banks can offer crypto-adjacent services to customers. In the 2020 publication the OCC also reiterated that banks seeking to offer services to crypto clients and investors would need to apply the same risk management practices to crypto as are applied to traditional assets. In March 2025 the Acting Comptroller of the Currency issued a new publication, Interpretative Letter 1183, that has provided the sought after clarity and specificity requested by the TradFi space to engage in crypto activities.
Even with this new statement, and the proverbial gates opening for the TradFi-crypto integration to accelerate, there are several key points crypto investors should keep in mind.
Crypto Is Too Big To Ignore
One clear implications of this movement in OCC policy, especially when take in conjunction with other policy adjustments so far in 2025, is that the crypto sector is becoming too big to ignore. With a market capitalization in the trillions of dollars, TradFi institutions both on Wall Street and off the street developing products and services for retail and institutional customers, and governments (at the state and federal levels) making noises about directly purchasing bitcoin and other digital assets the trend is clear. Investors and policymakers across the board desire increased exposure to cryptoassets, and the U.S. banking sector needs to in position to capitalize on this growing demand.
Benefits for TradFi institutions include not only the obvious ones of opportunities for fees and other bottom-line items, but also the opportunity to expand offerings to Millennials and Gen-Z/Gen Alpha customers. According to research conducted by Gemini 51% of surveyed Gen-Z individuals own cryptocurrency, while Millennials are close behind with a 49% ownership level. As both cohorts continue to develop professionally and look to diversify investments, TradFi institutions are looking at both groups as future drivers of growth.
The FDIC And OCC Are Moving Together
Headlines about bitcoin reserves and digital asset stockpiles dominate conversations, but policy changes by the FDIC – alongside changes at the OCC – are quietly reshaping the landscape for crypto products and services in the U.S. In September 2024 the FDIC issued a Notice of Proposed Rulemaking that was designed to reinforce and clarify the recordkeeping requirements for bank deposits help by nonbank companies. Although the rule itself is aimed at FDIC-insured depository institutions, it will also have a significant effect on nonbank firms that rely on custodial accounts to offer crypto-adjacent payment services.
Specific requirements that are included in the Proposal include record keeping requirements highlighting and clarifying the beneficial owners of the account in question, the balances attributable to the owner, and the ownership category within which these funds are held. In addition the Proposal requires specific electronic file formats that must be followed, mandates for daily reconciliations, documented policies to that effect, and an obligation to undergo an annual certification of compliance.
In short, the FDIC’s Proposal is seeking to ensure that controls, policies, and compliance testing of said controls are equally robust for all parties involved in services that touch either nonbank fintech operators, or the digital asset ecosystem.
Crypto Payments Will Rise
Crypto payments, despite the increase in interest and investment that the digital asset space has experienced since 2024, continue to lag behind wider investment flows. According to research by the Pew Center, 17% of Americans surveyed have ever invested in, traded, or used cryptocurrency; an overall percentage that has remained unchanged since 2021. Hacks, the lingering doubts about the safety and security of cryptoassets, and the price volatility so closely affiliated with tokens such as Bitcoin and Ethereum have all contributed to the sluggish overall adoption of crypto for payments.
Actions like those taken by the OCC and FDIC, against the backdrop of wider policy changes, are creating an environment much more hospitable to crypto payments than in previous years and under previous administrations. With the U.S. banking system becoming increasingly amendable to not only using blockchain for internal purposes, but also for developing products and services for consumer use, crypto based payments will almost inevitable become more transparent, understandable for consumers, and safer than in the past. Combined with the high rates of ownership and interest in crypto by increasingly influential age cohorts, and the future of crypto payments continues to look bright.
