backIntroduction
On November 18, 2025, the Office of the Comptroller of the Currency (“OCC”) issued Interpretive Letter No. 1186 (the “OCC Letter”) confirming that national banks may, as an activity incidental to the business of banking, (1) hold crypto assets on its balance sheet in amounts necessary to pay blockchain network fees associated with otherwise permissible activities and (2) hold crypto assets to conduct testing of otherwise permissible crypto asset platforms.1Office of the Comptroller of the Currency, Interpretive Letter No. 1186 (Nov. 18, 2025).
Although the OCC issued the letter in response to a request from a bank that sought to engage in such activity, the OCC Letter is generally applicable to all national banks. The OCC Letter clarifies how banks can practically interact with blockchain networks without relying on third parties and enables controlled testing of crypto platforms before customer use. The OCC Letter comes in the wake of prior OCC guidance authorizing banks to engage in certain crypto asset custody and execution activities2See, e.g., Office of the Comptroller of the Currency, Interpretive Letter No. 1184 (May 7, 2025). and the stablecoin legislation that was signed into law earlier this year.
The OCC Letter
In reaching its conclusion, the OCC concluded that paying network fees on distributed ledger technology networks and maintaining the native tokens required to pay those fees are “convenient or useful” to the activities already permissible for national banks, and therefore incidental to the business of banking.3Interpretive Letter No. 1186 at 4 (citing 12 U.S.C. 24 and 12 C.F.R. 7.1000(d)(1)). Applying the factors from 12 C.F.R. 7.1000(d)(1) in a technology-neutral manner, the OCC found that the activity (1) facilitates a bank’s products or services, (2) enhances sales or marketing, (3) improves effectiveness or efficiency, and (4) enables a bank to use existing capacity to avoid waste.4Id. at 4-5, 9. The OCC therefore confirmed that the bank may hold limited amounts of such crypto assets on its balance sheet to cover reasonably foreseeable network fee obligations, including where the bank chooses to pay fees as a customer convenience or to streamline operations.5Id. at 1, 5-6. Further, where the bank operates as a node on a distributed ledger, it may also receive network fees and hold them on its balance sheet for an appropriate period of time as part of that permissible activity.6Id. at 10. The OCC Letter also notes that this permissibility analysis applies equally to a bank’s operating subsidiaries engaged in the same activities.7Id. at 5.
The OCC Letter similarly confirmed that the bank may hold crypto assets needed to test otherwise permissible crypto asset platforms.8Id. at 10-11. This holding applies regardless of whether the platform was developed internally or obtained from a third party.9Id. The OCC tied this to banks’ authority to produce, market, or sell software that performs services the bank could perform directly, underscoring that effective pre‑production testing is integral to safe and sound operations.10Id. In further support of this, the OCC reasoned that third-party testing can not only increase costs but also expose banks to increased operational and counterparty risk and practically limit the likelihood that banks thoroughly test their systems.11Id. Allowing banks to hold tokens directly for testing facilitates safe development, effective evaluation of controls, and compliance validation for platforms supporting bank-permissible activities.12Id.
In reaching this conclusion, the OCC noted that the requesting bank proposed a comprehensive compliance program to support its request.13Id. at 4. The bank’s program consisted of three main components: (1) a risk and compliance assessment covering technical design, technology, operations, cybersecurity, liquidity, illicit finance, and legal and regulatory risks; (2) procedures for measuring and managing risk, including cryptographic and operational controls, safeguards against illicit finance, standard operating procedures, and oversight of third parties; and (3) limits to ensure that the amount of crypto assets held is kept minimal compared to the bank’s capital, and only enough to cover network fees for anticipated transactions.14Id.
Why It Matters
The OCC Letter removes practical impediments that have been particularly acute on networks where all activity, even where a bank acts solely as custodian or validator, requires a native token to execute transactions. By recognizing that limited holdings of native tokens to pay such fees are incidental to otherwise permissible activities, the OCC aligns operational realities with legal authority. The OCC Letter places network-fee holding in the context of previous OCC guidance and recognizes the need to evolve with technology.
The OCC Letter opens the door for banks to perform core crypto-related operations more effectively. This includes streamlining custody transfers, on‑chain reconciliation, and settlement; reducing reliance on third‑party fee providers; operating nodes, including receiving and temporarily holding network fees, consistent with safe practices; and conducting robust pre‑production testing of wallets, security, and compliance controls.15Id. at 5-11 Additionally, banks may cover network fees as part of delivering services, temporarily hold fees received through node operations, and maintain small amounts of tokens to test otherwise permissible platforms, provided these activities support permissible banking services and are governed by clear policies and disclosures.16Id. at 5-6, 10-11. These activities enable banks to carry out essential operations involving crypto assets without authorizing investment in or trading of crypto assets.
Conclusion
The OCC Letter gives national banks a straightforward way to hold small amounts of native tokens for network fees and platform testing, as long as these holdings are limited, have a clear purpose, and are backed by strong compliance and risk management programs to support the bank’s requested activities. Looking ahead, we anticipate that federal agencies will continue to issue incremental rules and guidance in the digital asset space as they continue to respond to the newly enacted stablecoin legislation and a generally crypto-friendly regulatory posture. Banks that implement these controls and maintain open communication with regulators will be well positioned to expand crypto-related services responsibly and in accordance with evolving regulatory expectations.