The SEC requires US banks to follow risk and custody rules, as the OCC lets banks trade crypto directly.
- The OCC approved “riskless principal” transactions, enabling US banks to allow trading in cryptocurrencies directly.
- SEC Chairman Paul Atkins emphasized that banks must uphold current risk, custody, and investor protection regulations for traditional securities.
- Increased bank acceptance is evidenced by Bank of America allowing advisers to recommend crypto in client portfolios from January.
The OCC approved “riskless principal” transactions on Tuesday, allowing US banks to trade Bitcoin and other cryptocurrencies directly.
Previously, banks could only facilitate cryptocurrency transactions as custodians or via third-party platforms. Under the new rule, banks could directly match client buy and sell orders without keeping Bitcoin on their own balance sheets. Banks were barred from touching the trade flow itself because doing so could expose them to balance-sheet risk, trading risk, and supervisory uncertainty. They could only store Bitcoin for clients, but could not transact it on their behalf.
SEC Says Rules Remain Unchanged
Speaking with Decrypt, SEC Chairman Paul Atkins stated that the move does not change the agency’s expectations. He stated that banks entering the Bitcoin market must adhere to the same risk, custody, and investor-protection regulations that apply in traditional securities markets.
Bitcoin’s price was trading at around $92,200 at the time of writing, down 1.2% in the last 24 hours. On Stocktwits, retail sentiment around BTC remained in the ‘bearish’ territory amid ‘low’ levels of chatter.
Banks Expand Direct Crypto Access
On the same day, PNC Bank announced direct spot bitcoin trading for qualified PNC Private Bank clients. William S. Demchak, CEO of PNC, said that the partnership with Coinbase lets customers trade Bitcoin “in a controlled and familiar environment.” Clients will soon be able to buy, hold, and sell bitcoin directly through PNC’s digital banking platform, thanks to Coinbase’s Crypto-as-a-Service infrastructure. The PNC Private Bank Online environment will also include custody.
This comes as many banks are increasingly becoming welcoming to cryptocurrencies. Bank of America (BAC) is reportedly set to allow wealth advisers to recommend cryptocurrency allocations in client portfolios beginning in January. Last month, SoFi (SOFI) became the first national bank to allow its members to buy, sell, and hold cryptocurrencies.
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