National banks are now allowed to engage in riskless principal crypto-asset transactions, per Interpretive Letter #1188 issued by the Office of the Comptroller of the Currency (OCC) in December 2025. In essence, this means that banks can now facilitate transactions between buyers and sellers of crypto-assets, while not taking on any significant market risk. But let’s dive deeper.

To understand the implications of the OCC’s letter, it’s important to first understand what a riskless principal transaction entails. Simply put, a riskless principal transaction involves an intermediary purchase of an asset from one counterparty for immediate resale to a second counterparty.

The intermediary’s purchase from the first counterparty and sale to the second counterparty occur simultaneously. As a result, the transaction is referred to as “riskless” because the intermediary does not hold any asset in its inventory and does not enter into the transaction without also having entered into an immediate offsetting transaction. Of course, there are exceptions, in which the completion or settlement of the transaction does not occur as expected, however, such exceptions should be infrequent and short-term in nature. In this case, the asset is typically sold as soon as possible.

As an example: a commercial customer seeking to acquire a specific crypto-asset could place an order through its bank. The bank would then purchase the asset from a counterparty and immediately transfer it to the customer, earning a fee for facilitating the transaction rather than profiting from price movements.

The OCC determined that riskless principal crypto-asset transactions are now permissible because they are both the functional equivalent to recognized bank brokerage activities and a logical outgrowth of crypto-asset custody activities.

Additionally, the OCC already allows banks to engage in riskless principal securities transactions. The primary differences between riskless principal crypto-asset transactions and traditional securities transactions are the nature of the underlying asset and the technology used to execute and settle the transaction. From the OCC’s perspective, these differences do not introduce fundamentally new risks beyond those banks already manage in other brokerage-type activities.

The OCC also noted that state-chartered banks in certain jurisdictions already have authority to engage in riskless principal crypto-asset transactions. Extending similar authority to national banks promotes regulatory consistency and competitive parity across the banking system.

Importantly, in its letter, the OCC emphasized that banks must conduct riskless principal crypto-asset transactions in a “safe and sound manner” and in compliance with applicable law. As with any new product or service, banks should carefully assess the risks involved before proceeding. For tailored guidance, banks should consider reaching out to a trusted advisor.

So, what’s the bottom line for banks and their customers? Ultimately, engaging in riskless principal crypto-asset transactions has the potential to benefit banks by expanding their service offerings and allowing them to meet growing customer demand for digital asset exposure. As customers increasingly seek regulated alternatives to cryptocurrency exchanges and fintech platforms, these transactions offer a new way for banks to remain competitive while maintaining strong risk oversight.

From a customer perspective, the ability to transact crypto-assets through a regulated bank may provide additional confidence. Customers may benefit from enhanced transparency, established compliance programs, and clearer avenues for recourse compared to less regulated platforms. For businesses, in particular, accessing crypto-asset services through an existing banking relationship may streamline operations and reduce counterparty concerns.

In closing, The OCC’s latest guidance represents another step in the gradual evolution of federal banking regulators’ approach to digital assets, moving from initial caution toward a framework that allows innovation under appropriate safeguards. While the guidance provides new opportunities for banks to meet customer demand and remain competitive, it also underscores the importance of disciplined risk management, regulatory compliance, and thoughtful implementation.