The FED, FDIC, and OCC Released a Joint Statement on Cryptocurrency!

The three major federal banking regulators in the U.S., the FED, the Office of the Comptroller of the Currency (OCC), and the Federal Deposit Insurance Corporation (FDIC), issued a joint statement explaining how existing rules regarding banks providing crypto asset custody services on behalf of their customers will be applied.

This statement aims to reduce the uncertainties regarding how banks can participate in the crypto sector.

In the joint statement, the regulators emphasized that while detailing how the existing legal framework and risk management principles apply to cryptocurrency asset custody activities, no new audit standard has been introduced.

"Banking institutions considering the custody of crypto assets should take into account the evolving nature of these markets and the technology they are based on; they should establish an appropriate risk management framework."

According to the explanation, banks that provide cryptocurrency custody services will be responsible for securely holding digital assets on behalf of their customers, and during this process, they will need to prioritize issues such as the protection of digital keys, cybersecurity risks, and operational controls.

The statement noted that the custody of crypto assets requires significant resources and expertise due to factors such as the complexity of the relevant technology, market volatility, and rapid changes. It was also added that banks need to conduct comprehensive risk assessments and have sufficient technical capacity before offering this service.

Cryptocurrency assets can be stored in both "fiat" and "non-fiat" capacities. If banks take on roles such as trustee, executor of a will, or investment advisor, they must comply with relevant federal regulations, for example, 12 CFR 9 or 150(, and state laws.

Since Donald Trump's return to the presidency, there has been a noticeable increase in statements and attitudes regarding crypto regulations. In May, OCC announced that US banks would be able to trade crypto assets in their own name. FDIC, on the other hand, had previously removed the mandatory prior notification requirement, allowing banks to participate more freely in crypto activities.

Following these regulatory statements, the appointment of crypto-friendly figures to critical institutions is also noteworthy. Last week, the Senate approved the appointment of Jonathan Gould, a former blockchain executive, as the head of the OCC. Gould had previously served as chief legal officer at Bitfury and held senior positions at the OCC.