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US banks can handle customer crypto assets held in custody, regulator confirms

The US Office of the Comptroller of the Currency (OCC) has confirmed banks under its jurisdiction can trade crypto on behalf of customers and outsource some crypto activities to third parties. 

Acting comptroller Rodney Hood said in a May 7 letter that banks and federal savings associations can buy and sell crypto they hold in custody at customers’ direction.

The OCC added in a press release that financial institutions can also outsource bank-permissible crypto activities, including custody and execution services, to third parties in compliance with applicable law.

“Additionally, these banks may provide other custody services, including record keeping, tax or reporting services for their customers,” Hood said in a May 7 video posted to X. 

“OCC banks may use a sub-custodian to provide the same services subject to appropriate third-party risk management practices, while a range of cryptocurrency and digital asset activities may be performed by banks and their third parties,” he added. 

Previously, the OCC eased its stance on how banks can engage with crypto on March 7 by giving the green light for crypto-asset custody, some stablecoin activities, and participation in independent node verification networks such as distributed ledgers. 

“More than 50 million Americans hold some form of cryptocurrency. This digitalization of financial services is not a trend; it is a transformation,” Hood said. 

The OCC is an independent bureau within the US Department of the Treasury that regulates and supervises all national banks and also the federal branches of foreign banks.

Industry supports the OCC letters 

Katherine Kirkpatrick Bos, general counsel at ZK-rollup developer StarkWare, said the letters signal a “shift in the OCC’s approach,” which now appears to favor a focus on integrating crypto within banking frameworks. 

“More guidance will give further clarity [and] will allow banks to re-enter crypto [without] the fear of existential regulatory risk,” she said. 

She added the OCC’s “explicit permission today allowing banks to outsource bank-permissible crypto-assets is a boon to regulated crypto native service providers.” 

US banks can handle customer crypto assets held in custody, regulator confirms
Source: Katherine Kirkpatrick Bos

Chief policy officer at crypto exchange Coinbase, Faryar Shirzad, also applauded the move, saying in a May 7 post to X, Hood’s commitment to “regulatory clarity, as well as his adherence to supervisory best practices and the letter of the law,” is appreciated. 

The Trump administration has taken a friendlier attitude toward crypto since coming into power in January. 

Related: The lessons learned at Operation Chokepoint 2.0 Congressional hearings

In April, the US Federal Reserve announced it was withdrawing guidance that was created to deter banks from engaging in crypto and stablecoin activities.

US President Donald Trump also signed a joint congressional resolution on April 11, overturning a Biden administration-era rule that would have required decentralized finance protocols to report transactions to the Internal Revenue Service.

Magazine: SEC’s U-turn on crypto leaves key questions unanswered

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Cryptojacker gets 1 year prison after admitting to $3.5M fraud

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Cryptojacker gets 1 year prison after admitting to .5M fraud

Cryptojacker gets 1 year prison after admitting to .5M fraud

Charles O. Parks III, who admitted to misusing $3.5 million worth of resources from two cloud computing providers to mine crypto, was sentenced to one year and one day in prison.

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How a chaotic 24 hours unfolded ahead of Trump and Zelenskyy’s crunch White House talks

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How a chaotic 24 hours unfolded ahead of Trump and Zelenskyy's crunch White House talks

If there’s one thing the past 24 hours has confirmed, it’s that it’s still Donald Trump’s world, and we’re all just living in it.

In the aftermath of the Alaska meeting, the US president’s deal-making skills came under question when he seemingly walked away empty-handed.

But it was clear he had retained his ability to catch everyone off guard, as a meeting between him and President Volodymyr Zelenskyy unexpectedly became a last-minute White House peace summit.

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Ukraine faces biggest challenge yet ahead of White House talks

The invitation to European leaders drifted out, and within hours, the cast list had grown to include six more, as world leaders dropped everything to fit in with Mr Trump’s unpredictable timetable.

There were signs of disorganisation behind the scenes.

When the British Prime Minister’s spokesman was asked who the invite had come from – the White House or the Ukrainian president – they replied: “A bit of both.”

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Meanwhile, the meeting of the coalition of the willing – a Starmer and Macron-led group of Ukraine’s European allies – had a nervous feel to it as members resolved to stand firm with Ukraine – even if it puts them at odds with the US.

At times, it sounded like they were trying to convince themselves they could do it.

And as all of this frantic diplomatic reaction played out, the man in the middle of it all headed to the golf course – calm at the centre of the diplomatic storm he created as his allies swirl around him.

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Sir Keir Starmer and his allies have no choice but to keep their Trump criticisms implicit

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Sir Keir Starmer and his allies have no choice but to keep their Trump criticisms implicit

Sir Keir Starmer is straining his diplomatic sinews to simultaneously praise Donald Trump’s efforts to end the war in Ukraine, while repeating calls for a completely different approach – one which ends the cosy bonhomie with Vladimir Putin, threatens the Russians with sanctions, and puts the Ukrainians back centre stage.

If that’s a message which feels like quite a stretch in writing, in person, during this morning’s call of international leaders, it must have been even more awkward.

Major shift as Trump backs peace deal over ceasefire; follow latest

Donald Trump‘s public dismissal of the Europeans’ previous calls for a ceasefire – after his tete-a-tete with Putin – has only highlighted divisions.

Of course, the prime minister and his European allies have no choice but to keep their criticism of the Alaskan summit implicit, not explicit.

Donald Trump and Vladimir Putin after their private meeting in Alaska. Pic: Reuters/ Kevin Lamarque
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Donald Trump and Vladimir Putin after their private meeting in Alaska. Pic: Reuters/ Kevin Lamarque

Even as they attempt to ramp up their own military preparedness to help reinforce any future peace deal, they need President Trump to lead the way in trying to force President Putin to the negotiating table – and to back up any agreement with the threat of American firepower.

For Downing Street, President Trump’s new willingness to contribute to any future security guarantee is a significant step, which Starmer claims “will be crucial in deterring Putin from coming back for more”.

It’s a commitment the prime minister has been campaigning for for months, a caveat to all the grand plans drawn up by the so-called Coalition of the Willing.

While the details are still clearly very much to be confirmed, whatever comments made by Donald Trump about his openness to help police any peace in Ukraine have been loudly welcomed by all those present, a glimmer of progress from the diplomatic mess in Anchorage.

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Trump-Putin meeting: Key takeaways

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Key takeaways from the Alaska summit

Of course, the promise of security guarantees only means anything if a peace deal is actually reached.

At the moment, as the European leaders’ bluntly put it in repeating Donald Trump’s words back to him: “There’s no deal until there’s a deal.”

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Wallace: Putin ‘laughing all the way home’

Fears of Zelenskyy being painted as warmonger

There is clearly real concern in European capitals following the US president’s comments that the onus is now on Volodymyr Zelenskyy to ‘do a deal’, that the Ukrainians will come under growing pressure to make concessions to the Russians.

As former defence secretary Ben Wallace said: “Given that Donald Trump has failed to deliver a deal, his track record would show that Donald Trump then usually tries to seek to blame someone else. I’m worried that next week it could be President Zelenskyy who he will seek to blame.

“He’ll paint him as the warmonger, when in fact everybody knows it’s President Putin.”

The European leaders’ robust statements describing the “killing in Ukraine” and Russia’s “barbaric assault” are an attempt to try to counter that narrative, resetting the international response to Putin following the warmth of his welcome by President Trump – friendlier by far than that afforded to many of them, and infinitely more than the barracking President Zelenskyy received.

They’ll all be hoping to avoid a repeat of that on Monday.

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