Not long after US President Donald Trump promised to end the long-running crackdown that made it hard for crypto companies to use banking services, the US Office of the Comptroller of the Currency (OCC) loosened its rules on how banks can work with crypto.
In a March 7 statement, the OCC said that national banks and federal savings associations can provide crypto-asset custody, take part in certain stablecoin activities, and join independent node verification networks like distributed ledger.”
OCC’s New Rules Will Make Things Easier for Banks
As of Interpretive Letter 1183, the OCC confirmed that it no longer requires financial institutions under its supervision to get “supervisory nonobjection” for crypto-related activities.
Acting Comptroller of the Currency Rodney E. Hood claims that today’s action will help banks conduct crypto-related business while ensuring that the OCC handles these operations consistently.
The agency said that now OCC staff have a deeper understanding of cryptocurrency and want to relax their rigorous policies to “encourage responsible innovation and enhance transparency.”
But Caitlin Long, founder and CEO of Custodia Bank, said in a March 7 X post that Operation Chokepoint 2.0 “isn’t over” until the US Federal Reserve and the Federal Deposit Insurance Corporation also take back their “anti-crypto guidance.” The industry has welcomed the OCC’s recent letter.
Just hours after Trump said he was “ending Operation Chokepoint 2.0,” crypto business leaders gathered at the White House.
It was ridiculous what they were doing, but some people suffered. People changed their minds in the end, but Trump said it was because they wanted votes, not because they were right.
Operation Chokepoint 2.0 Forced Banks To Stay Away From Crypto
According to industry advocacy groups, Operation Chokepoint 2.0 had a big effect on the industry in many countries and was a big problem during the 2024 US election.
Trump said, “They used the government as a weapon against the whole industry and forced banks to shut down crypto businesses and people who ran businesses to stop money transfers to and from exchanges.”
“I get that feeling too—maybe even more than you do. But don’t worry, it’ll be over soon.”
Many crypto firms turned to stablecoins to keep their businesses running after losing their business accounts at traditional regular banks during the debanking operation.
On Jan 16, Wyoming Senator Cynthia Lummis sent a letter to the FDIC, claiming that whistleblowers informed her that the agency was accused of getting rid of records tied to Operation Chokepoint 2.0.
At the time, she said, “If it is uncovered that you or your staff have knowingly destroyed materials or sought to obstruct the Senate from doing its job, I will make swift and quickly report the case to the Justice Department.”
The ruling is big news for crypto because it means banks and crypto companies can now team up without hurdles. However, unless other US financial regulators also modify their rules, the battle remains unresolved. Stay tuned for more, because surprises are ahead!
