The Fed, FDIC, OCC Issue Crypto Custody Guidelines

The Federal Reserve, FDIC, and OCC released a joint statement on July 15, detailing guidance for banks involved in cryptocurrency custody.

The guidelines mark a significant step towards regulatory clarity, potentially encouraging institutional adoption of crypto assets.

Federal Agencies Establish Crypto Custody Regulations

The recent announcement from the Federal Reserve, FDIC, and OCC clarifies regulations for banks offering cryptocurrency custody services. This joint guidance aims to standardize crypto custodial practices across banks, ensuring safe execution and compliance. Banks are expected to follow established risk management protocols as part of the directive.

This collaborative action intends to ensure the secure handling of digital assets, providing certainty to financial institutions entering the cryptocurrency space. With this guidance, banks can engage in crypto custody safely and soundly, potentially enhancing their service offerings.

“The OCC clarified that banks can engage in crypto custody and execution services in a safe and sound manner.” — Michael J. Hsu, Acting Comptroller of the Currency, OCC

Market responses have been cautiously optimistic, with some expressing hopes for increased mainstream adoption. While specific statements from key financial leaders were not explicitly documented, the regulatory clarity is viewed as a positive step by many industry stakeholders.

Bitcoin Price and Impact on Institutional Confidence

Did you know? Regulatory clarity on cryptocurrency custody could increase institutional participation, reminiscent of shifts observed during pivotal regulatory milestones in banking history.

According to CoinMarketCap, Bitcoin (BTC) is currently priced at $119,826.68, with a market cap of $2.38 trillion. It maintains a market dominance of 63.55%. The 24-hour trading volume rose by 295.62% to $180.05 billion. Over the past 90 days, BTC saw a 41.94% increase in price.

Coincu’s analysis suggests that the joint directive is likely to bolster institutional confidence, potentially leading to increased adoption and integration of crypto custody services. The guidance may also spur technological advancements within the banking sector to support these new services.