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President Donald Trump at the 2024 Bitcoin Conference in Nashville, TN.
The Washington Post via Getty Images
The world of financial services is always evolving, but recently there are signs of a seismic shift. At the heart of this transformation is the rise of cryptocurrencies. Digital assets like Bitcoin, Ethereum, and a host of others – including stablecoins – have moved from the fringes of the financial system to the forefront, capturing the attention of investors, regulators, and, increasingly, traditional banks. As the cryptocurrency market continues to mature, one question that is becoming increasingly urgent to answer is whether banks in the United States should be permitted to own cryptocurrencies. If banks are to remain relevant in the rapidly changing financial landscape, then participating in the cryptocurrency markets is a necessary and logical step in the evolution of banking.
A Shifting Regulatory Landscape
Since the beginning of the crypto asset class, the relationship between banks and cryptocurrencies has been fraught with tension. Regulatory uncertainty, concerns over volatility, and the perceived risks associated with digital assets have kept banks on the sidelines. Most banks have even shied away from providing any banking services to companies and individuals who had interest in the digital asset class.
However, recent developments, particularly from the Office of the Comptroller of the Currency (OCC), have begun to pave the way for greater bank involvement in the cryptocurrency space. On March 7, 2025, the OCC issued Interpretive Letter 1183 (IL 1183), which provided much-needed clarity on the ability of national banks to engage with cryptocurrencies. This letter affirmed early guidance that national banks can provide cryptocurrency-related services—such as custody and trading—as long as they do so in a safe and sound manner. The original guidance, articulated in Interpretive Letter 1170 in July 2020, was never withdrawn, but for almost five years it was practically disavowed.
Although the OCC has shown a path for banks to offer cryptocurrency services, the question of direct bank ownership of cryptocurrency remains a sticking point. In a joint statement from the OCC, Federal Deposit Insurance Corporation (FDIC), and Federal Reserve in January 2023, banks were cautioned against holding public cryptocurrencies like Bitcoin on their balance sheets (read: prohibited). The restriction, rooted in concerns over risk and stability, feels increasingly out of step with the realities of the modern financial system. The OCC recognized that was time to revisit this stance, and Acting Comptroller of the Currency Rodney E. Hood announced the OCC withdrew from the joint statement. Subject to safety and soundness considerations, according to the OCC, national banks have the ability to own cryptocurrencies outright.
Bringing Trust and Stability to a Volatile Market
Perhaps the strongest argument for allowing banks to provide products and services in cryptocurrency, and to own cryptocurrencies directly, is their unique ability to bring trust and stability to a market that desperately needs it. Banks have centuries of experience managing complex financial assets, from stocks and bonds to derivatives and foreign exchange. They operate under some of the strictest regulatory frameworks in the world, with requirements for capital reserves, liquidity, and consumer protection that far exceed those of the average fintech or cryptocurrency exchange.
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