US banks can now trade crypto on behalf of customers and outsource some crypto activities to third parties

The US Office of the Comptroller of Currency (OCC) has confirmed that banks can trade crypto on behalf of customers and outsource some crypto activities to third parties.

In a May 7 letter to Congressman Steve Scalise, acting comptroller Rodney Hood said that banks and federal savings associations can buy and sell crypto they hold in custody at customers' direction.

The OCC also stated in a press release that financial institutions can outsource bank-permissible crypto activities, including custody and execution services, to third parties in compliance with applicable law.

"These banks may also provide other custody services, including record keeping, tax or reporting services for their customers," Hood added in a May 7 video.

OCC-regulated banks may buy and sell assets held in custody and are permitted to outsource bank-permissible crypto-asset activities, including custody and execution services.https://t.co/0ScQdgNaS6

This follows March 7 guidance in which the OCC eased its stance on how banks can engage with crypto. At the time, the regulator gave the green light for crypto-asset custody, some stablecoin activities and participation in independent node verification networks such as distributed ledgers.

"The OCC is keenly aware that more guidance will give further clarity and will allow banks to re-enter crypto without the fear of existential regulatory risk," said Katherine Kirkpatrick Bos, general counsel at ZK-rollup developer StarkWare.

"Finally, the OCC’s explicit permission today allowing banks to outsource bank-permissible crypto-assets is a boon to regulated crypto native service providers."

The Trump administration has taken a friendlier attitude toward crypto since coming into power in January. Notably, the administration intervened to scuttle a Senate bill that would have created a regulatory framework for crypto.

Earlier this year, the US Federal Reserve announced it was withdrawing guidance that was created to deter banks from engaging in crypto and stablecoin activities.

Trump also signed a joint congressional resolution on April 11, overturning a Biden administration-era rule that would have required decentralized finance protocols to report transactions to the Internal Revenue Service.