OCC Says Banks Can Pay Crypto-Asset Network Fees for Permissible Activities

The Office of the Comptroller of the Currency (OCC) published an interpretive letter Tuesday (Nov. 18) that the regulator said confirmed that for specified activities, national banks can pay crypto-asset network fees and hold crypto-assets as principal.

The OCC detailed its confirmation of these activities in its Interpretive Letter 1186, the regulator said in a Tuesday press release.

National banks can pay network fees, or “gas fees,” on blockchain networks to facilitate permissible activities and can hold, as principal, crypto-assets on balance sheet to pay anticipated network fees, according to the release.

These banks can also hold crypto-assets as principal for testing crypto-asset-related platforms, per the release.

“As with any activity, a national bank must conduct these activities in a safe and sound manner and in compliance with applicable law,” the OCC said in the release.

PYMNTS reported in July that the confirmation of Jonathan Gould as comptroller of the currency signaled a relaxation of digital asset regulations, particularly for banks, and an easier path for some nonbanks and digital upstarts to obtain banking charters.

The groundwork was laid in May by then-Acting Comptroller Rodney Hood, who debuted Interpretive Letter 1184, which stated that “banks may provide crypto-asset custody services in a fiduciary or non-fiduciary capacity […]” The letter added: “Providing crypto-asset custody services is a modern form of traditional bank custody activities.”

When the OCC announced in October that it conditionally approved the de novo national bank charter application for Erebor Bank, a new national bank that plans to focus on technology companies and ultra-high-net-worth individuals that use virtual currencies, Gould said this served as proof that the regulator under his leadership “does not impose blanket barriers to banks that want to engage in digital asset activities.”

“Permissible digital asset activities, like any other legally permissible banking activity, have a place in the federal banking system if conducted in a safe and sound manner,” Gould said at the time in a press release. “The OCC will continue to provide a path for innovative approaches to financial services to ensure a strong, diverse financial system that remains relevant over time.”