The OCC's decision doubles down on allowing community banks to partner with stablecoin development companies to promote innovation and digital services.
OCC Clarifies Stablecoin Strategy—Community Banks Can Lead the Next Wave
The Office of the Comptroller of the Currency (OCC) announced on social media platform X last week that community banks can expand their financial service offerings by forming partnerships with stablecoin development companies. The regulator emphasized that it would reconsider its management and oversight approach to ensure supervision remains aligned with both innovation and the sustainability of smaller banks. This move marks a significant adjustment from previous caution as the OCC increasingly engages in the digital asset space while still focusing on financial stability. The OCC stated:
Community banks can collaborate with stablecoin development companies to foster innovation and deliver new products. The OCC will review and update its management and oversight approach as needed to ensure it supports innovation in banking and the vitality of community banks.
With this message, the OCC highlighted how such partnerships can enable smaller banks to compete with larger institutions by broadening their service offerings and providing customers with new digital payment options. This effort aligns with the broader trend of blockchain adoption in financial markets, where stablecoins are being integrated into payment systems and banking operations.
The OCC's post also quoted Jonathan V. Gould, who was sworn in as the 32nd Comptroller of the Currency on July 15, 2025, stating:
Community banks play a crucial role in providing essential financial services. Stablecoins are a way for these institutions to better serve the payment needs of their communities.
The OCC's statement is based on years of guidance on digital assets. While the agency appeared to support cryptocurrencies in 2020 and early 2021 under Acting Comptroller Brian Brooks—allowing custody services, stablecoin reserve management, and the use of distributed ledger systems—its stance shifted after his departure, with new leadership adopting a more cautious approach. In 2021, Letter 1179 required banks to obtain written non-objection from the OCC before engaging in cryptocurrency-related activities, effectively limiting participation. That restriction was lifted in March 2025 by Letter 1183. In May 2025, Letter 1184 clarified that national banks and federal savings associations could offer and outsource custody services and engage in cryptocurrency.
The OCC's shifting stance has been reinforced by the 2025 U.S. National Stablecoin Guidance and Establishment Act (GENIUS Act), primarily designating the OCC as the primary regulator for federally licensed non-bank stablecoin issuers. While some critics remain wary of the increased risks for community banks, supporters argue that stablecoins enhance efficiency, reduce payment costs, and expand financial access—advantages that could strengthen smaller institutions in a competitive market.
