Large-cap cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), Solana (SOL), and XRP have recorded impressive gains over the last 72 hours, attempting to recoup previous losses. The resurgence comes on the heels of new regulatory clarity in the US, allowing banks to participate in cryptocurrency transactions.
US Banks Can Now Offer Cryptocurrency Services
The Office of the Comptroller of the Currency (OCC) has confirmed that US banks may act as intermediaries for cryptocurrency transactions, providing fresh clarity for sector players. The US regulator issued an Interpretive Letter permitting national banks to engage in “riskless principal transactions” involving crypto assets.
Per the statement, a riskless principal transaction involves the purchase of an asset from one counterparty and the immediate sale to a second party. To qualify, banks will essentially act as brokers and will not hold any cryptocurrencies in inventory, except in rare circumstances.
The OCC noted that such “riskless” transactions will not attract scrutiny from the banking regulator, with several banking executives welcoming the move. On the retail side, pundits opine that the OCC’s decision to relax its stance on riskless cryptocurrency transactions will significantly move the needle for adoption in the US.
While the OCC has extended decades-old securities market practices to cryptocurrencies, the guidance fails to address several inherent risks. Pundits argue that banks may face issues such as settlement finality, cross-border exposures, and unregulated counterparties.
A bird’s-eye view of the OCC’s declarations reveals a pattern of softening stances toward US financial institutions that embrace cryptocurrencies. Last month, the regulator confirmed that banks can hold cryptocurrencies to pay on-chain fees, extending the Trump administration’s streak of merging traditional finance with crypto.
Cryptocurrency Rally Following The OCC’s Statement
According to CoinMarketCap data, cryptocurrency prices have surged over the last day, latching onto the buzz around the OCC’s statement. Bitcoin shed its bearishness, reaching an intraday high of $91,601 and gaining nearly 3% over the last day.
Meanwhile, the Ethereum price recorded its biggest daily gain since the start of December, surging by 8%. With prices at $3,127, ETH bulls are eyeing a strong rally beyond $3,500.
Compared to ETH, other altcoins recorded fairly modest gains, with BNB and XRP gaining 1% in the wake of the OCC’s statement. However, SOL pulled in 5% while DOGE and ADA settled for a respectable 3% surge on the daily price chart.
Source: https://zycrypto.com/btc-eth-sol-xrp-react-as-us-banks-receive-approval-to-offer-cryptocurrencies-to-customers/
