According to new guidance published by The Office of the Comptroller of the Currency (OCC), national banks and federal savings associations are now permitted to hold reserve currencies for stablecoins. It is the first official guidance on stablecoins by the OCC.
Acting Comptroller of the Currency and former Coinbase executive, Brian Brooks, said in a press release that:
“National banks and federal savings associations currently engage in stablecoin related activities involving billions of dollars each day.”
The new guidance provides greater clarity for banks from a regulatory standing point for banks providing services to stablecoin issuers.
An accompanying interpretive letter by Jonathan Gould, Senior Deputy Comptroller and Chief Counsel of the OCC, outlined what the new ruling entails. The letter specifically mentions that the ruling will only apply to stablecoins backed 1:1 with another currency. This is exciting news for stablecoins like Tether (USDT), as it is pegged 1:1 with the US Dollar, but may prove complicated for Facebook and its Libra project.
“A bank providing services in support of a stablecoin project must comply with all applicable laws and regulations and ensure that it has instituted appropriate controls and conducted sufficient due diligence commensurate with the risks associated with maintaining a relationship with a stablecoin issuer.”
The U.S. Securities and Exchange Commission (SEC) responded to the announcement by the OCC, stating that certain stablecoins might not be securities. This determination requires a careful analysis of the nature of the instrument, including the rights it purports to convey, and how it is offered and sold.
The SEC stated:
“We encourage parties seeking to structure and sell a digital asset, or to engage in related activities, to contact the FinHub Staff through www.sec.gov/finhub with any questions they may have to help ensure that such digital assets are structured, marketed, and operated in compliance with the federal securities laws.”