The US OCC has given banks the green light to provide cryptocurrency custody services.
The news came yesterday through a letter sent by the United States' banking supervisory authority. This gave the green light to the banks to finally manage this sector.
OCC, the Office of the Comptroller of the Currency, is an independent office of the United States Department of the Treasury. So this pronunciation takes on a governmental meaning. So much so that it can already be considered cash, banks can already apply it.
In the announcement, as well as in the letter, it is explained that banks can offer this service, which also includes the key custody associated with cryptocurrencies. It is also added that banks can provide any type of service related to cryptocurrencies, provided they comply with current laws.
As the OCC explains, this change is due to the need to use safe places like banks, and specifically for three reasons:
- The keys of the cryptocurrency wallet are irreplicable if they are lost, so whoever loses the keys loses the value of the possessed cryptocurrency;
- Banks can offer better security services than existing ones;
- Investment advisers prefer to entrust the keys of their clients to banks.
To this is added that:
"The OCC recognizes that as financial markets become increasingly technological, there is likely to be an increasing need for banks and other service providers to take advantage of new innovative technologies and ways to provide traditional services on behalf of clients. To the provide such services, banks can continue to fulfill the financial intermediation function that They have historically played in the provision of payment, loan and deposit services. Through exchanges intermediate of payments, banks facilitate the flow of funds within our economy and serve managing significant financial risks and other financial needs of bank customers. ”
Brian P. Brooks, Acting Comptroller of the Currency, OCC chief, explained:
"From safe deposit boxes to virtual vaults, we must ensure that banks can meet the financial service needs of their customers today," said Acting Comptroller of the Currency Brian P. Brooks. "This opinion clarifies that banks can continue to meet the needs of their customers to safeguard their most valuable assets, which today for tens of millions of Americans includes cryptocurrencies."
Banks and cryptocurrencies, hate and love
The advance of the OCC has been well received by the cryptocurrency sector.
Brian Armstrong, CEO of Coinbase, tweeted a word very briefly: "Progress".
Brad Garlinghouse, CEO of Ripple , commented in his place:
"BOOM! Today's decision is a great step forward. The OCC is absolutely leading the way in fostering innovation, protecting consumers, and providing a level playing field for all. The future has never been fiduciary versus crypto: these can and should coexist in harmony! ”
In fact, cryptocurrencies and Bitcoin are born to be decentralized. In short, they are somewhat more compared to banks. From this point of view, the pronunciation of the OCC and the choice of a user to entrust their cryptocurrencies to a bank seems to be a contradiction.
However, for banks, that turning point seemed inevitable: Cryptocurrencies are becoming an increasingly used tool, including in finance, so it is essential that traditional institutions, starting with banks, can keep up and start offering related services. The risk is that of being isolated from the future.