OCC Issues Letter, Allowing Banks to Use Public Blockchain Networks

Vandana  |  Jan 5, 2021

The Office of Comptroller of Currency (OCC) has been publishing various guidelines and letters for banks related to cryptocurrency and stablecoins custody. Now OCC issues a letter called Imperative Letter 1174, which allows the U.S. banks to use any public blockchain networks. Through this approval, the banks will have the ability to use stablecoins for several payment transactions for customers. The customers will be able to exchange stablecoins at the bank for fiat currency and banks can also issue one.

Cryptocurrency Prices Jumped as OCC Issues Letter

As soon as OCC issues the letter, cryptocurrency prices jumped impressively on Monday, January 04, 2020. Right after the release of this letter, the Ethereum price has surged by around 12%. Along with Ethereum, Bitcoin has also seen a surge of 5% after the release. With this surge, both the largest cryptocurrencies can recover from the losses that they faced on Sunday, January 03, 2020. 

Some of the crypto players have said that the crypto industry is pleased as OCC issues letter because this has been one positive regulatory news after so long for the crypto market. It has also been noticed that this letter by OCC is in contrast with the bill that requires stablecoin issuers to have bank charters

Different Regulations Issued for Crypto Market

From the past few months, it has been seen that different regulations have been issued by the U.S. government for the crypto market. Back in the previous month, the Treasury Department has proposed enhanced KYC rules for crypto users. These rules will be implied on those users who are trying to transfer their holdings from crypto exchanges to their wallets. This letter by OCC has been a positive regulatory stance for the crypto market after a while and the whole community appreciates this. Not only Bitcoin and Ethereum other cryptocurrencies have also seen an increase after the letter was published.

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