Banks, Crypto & Comedy: US Regulators Unleash Bankers’ Inner Bitcoiners 🤡💰

by

Somewhere in the dust-choked hallways of the Office of the Comptroller of the Currency, a clerk sneezed, and civilization shifted. Donning a suit likely as starched as his opinions, Acting Comptroller Rodney Hood—no relation to Robin, regrettably—penned a May 7 letter stating that American banks might, with neither fanfare nor a parade, hold and trade their customers’ cryptocurrencies. It seemed, in the land of opportunity, one could dream of riches and disappointment simultaneously.

He assured the bewildered masses (and let’s face it, his own staff) that financial institutions may—if boredom strikes their compliance officers—outsource these crypto dealings to any third parties clever enough to produce a business card.

“Why stop there?” Rodney muttered—perhaps to himself, certainly not to Congress. “Let them keep records, handle taxes, and report things while they’re at it.” The video, released onto the X-verse (previously Twitter, now hosting 3% real discourse and 97% arguments about dogs), offered these insights with the solemnity of a man waiting out his last week on the job.

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.

— OCC (@USOCC) May 7, 2025

Lest anyone accuse them of rushing, the OCC reminded everyone that sub-custodians are permitted, provided those third parties know how to spell “risk management.” No word yet on whether the sub-custodians themselves may outsource to their grandmothers.

Recall, if you must, that in March, there was a similar softening when the OCC allowed crypto custody, stablecoin dabbling, and node verification activities. “More than 50 million Americans hold some form of cryptocurrency,” Hood claimed. (Half of them still can’t log in.) This digital wave, he assures us, isn’t a passing fad. It’s a transformation. (And possibly a migraine.)

The OCC, that venerable guardian of banking sanity, continues to regulate with an ambiguous hand—and apparently, a nimble strategy borrowed from Russian literature: “We will supervise everything, and understand little.”

Industry Watches From the Sidelines, Popcorn in Hand 🍿

Katherine Kirkpatrick Bos of StarkWare saw these letters and, in a moment of either candor or caffeine, declared that the OCC’s tone now favored “integration.” She was positively jubilant about banks finally getting “explicit permission to outsource,” calling it “a boon to regulated crypto native service providers”—words which, when left unattended, flock together like hungry sparrows.

Faryar Shirzad at Coinbase clapped (virtually, one assumes) after Hood’s post, appreciating “regulatory clarity and best practices.” No bankers were seen dancing in the streets, but as Chekhov said, “If in the first act you permit buying and selling digital assets, in the third act someone will inevitably lose their password.”

And the winds of Washington have turned, with the Trump administration now treating crypto like a long-lost childhood toy. In April, the Fed withdrew earlier anti-crypto guidance, and President Trump himself signed away a Biden-era DeFi reporting rule. Cheers! Or, at least, a polite golf clap from everyone who didn’t quite understand what just happened.

Read More

2025-05-08 09:42