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US Banks Can Now Hold Reserves for Stablecoin Issuers, Says Federal Banking Regulator

US Banks Can Now Hold Reserves for Stablecoin Issuers, Says Federal Banking Regulator

The U.S. Office of the Comptroller of the Currency (OCC) on Monday printed a letter clarifying that nationwide banks and federal financial savings associations can now maintain reserves for stablecoin issuers within the nation.

According to the OCC’s interpretive letter, reserve accounts can both be funded via deposits from stablecoin issuers or deposits from particular person stablecoin holders.

It pressured that banks can maintain such reserves offered that ”the issuer has adequate belongings backing the stablecoin in conditions the place there’s a hosted pockets.” The letter responds to questions concerning the appliance of stablecoin-related financial institution actions. It says:

As the OCC lately reaffirmed, nationwide banks could present permissible banking companies to any lawful enterprise they select, together with cryptocurrency companies, as long as they successfully handle the dangers and adjust to relevant legislation, together with these referring to the [Bank Secrecy Act] and anti-money laundering.

Stablecoins are cryptocurrencies underpinned by one other asset akin to a commodity or fiat foreign money just like the U.S. greenback. They are designed to reduce the impression of value volatility. Tether (USDT) is probably the most extensively used stablecoin worldwide. Others embody USD Coin and DAI.

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In a press release, Acting Comptroller of the Currency Brian Brooks famous that federally chartered banks are “presently engaged in stablecoin associated actions involving billions of {dollars} every day.”

“This opinion supplies larger regulatory certainty for banks throughout the federal banking system to offer these shopper companies in a protected and sound method,” he acknowledged.

Jeremy Allaire, chief govt officer of Circle, issuers of the USDC stablecoin, stated the brand new OCC steering represents important progress for the development of digital greenback stablecoins within the U.S. monetary system.

“With this readability…fintech corporations and banks can have extra confidence in constructing on this innovation, whereas additionally guaranteeing that the guardrails and danger administration anticipated from the U.S. banking system may be utilized to this new age of web cash,” he stated in a press release shared with information.Bitcoin.com.

The OCC lately allowed federally chartered banks to carry custody of crypto belongings.

What do you concentrate on the OCC’s new steering on stablecoin reserves? Share your ideas within the feedback part beneath.

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The submit US Banks Can Now Hold Reserves for Stablecoin Issuers, Says Federal Banking Regulator appeared first on Bitcoin News.

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