The environment has never been more favorable for existing banking organizations launching a digital asset business and those Fintech and other nonbank companies considering acquiring or chartering a full-service or limited-purpose bank in order to operate a digital asset business. At the end of 2025, U.S. banking regulators continued to take major steps signaling a considerably more open supervisory posture regarding digital asset activities.
First, in December, the Office of the Comptroller of the Currency (OCC) conditionally approved five applications to either newly charter or convert existing institutions into national trust banks that will engage in digital asset activities. Sidley represented FMR LLC, the parent company of Fidelity Investments, in obtaining an approval permitting the conversion of its New York limited purpose trust company into a national trust bank. These approvals built upon a series of interpretive letters released by the OCC in 2025 expanding the range of permissible digital asset activities for national banks as well as the OCC’s rescission of an earlier interpretive letter that required formal nonobjection from the regulator before a national bank or federal savings association could engage in certain digital asset activities. Finally, on January 8, the OCC issued a proposed rulemaking that would clarify, but not change the scope, of its authority to charter national trust banks.
Second, the Board of Governors of the Federal Reserve System (the Federal Reserve) (i) rescinded and replaced a 2023 policy statement regarding state member bank novel activities with a new, more permissive policy statement and (ii) published a request for information seeking public comment on a proposed special purpose Federal Reserve Bank “payment account” prototype (informally, a “skinny master account”) aimed at institutions focused on payments innovation.
Finally, the U.S. Department of the Treasury (Treasury) published an advance notice of proposed rulemaking (ANPRM) seeking public comment relating to the implementation of the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act), while the Federal Deposit Insurance Corporation (FDIC) issued a notice of proposed rulemaking (NPRM) establishing an application process for subsidiaries of FDIC-supervised insured depository institutions to issue payment stablecoins under the GENIUS Act.
OCC Conditional Approvals for National Trust Bank Charters
On December 12, 2025, the OCC announced the conditional approval of five national trust bank charter applications from institutions proposing to offer digital asset products and services. Of the five applications, two were for de novo national trust bank charters, while three were for conversions from a state trust company to a national trust bank. National trust banks engage in a limited set of activities and generally do not take insured deposits or engage in commercial lending. Importantly, national trust banks benefit from federal preemption of certain state laws that may apply to a state-chartered trust company, such as money transmitter licensing laws. The proposed activities of the five institutions include digital asset custody, settlement, clearing, transfer, escrow, staking, trade execution, and brokerage services; fiduciary, exchange, and payment agent services; stablecoin issuance; and the provision of services, including reserve asset custody, to affiliated stablecoin issuers. The Tier 1 capital requirements for these institutions range from $6.05 million to $25 million. Several other national trust bank charter applications remain pending, and a range of institutions is considering or actively preparing similar applications. The OCC has indicated its intent to process applications on their merits in a timely manner, generally within 120 days from the receipt of a complete application. This clearly signals an open window for credible, well-advised applicants who are interested in chartering or acquiring a national bank.
OCC Crypto-Focused Interpretive Letters
Building on earlier interpretive letters issued in 2020 and 2021, in 2025 the OCC issued several interpretive letters broadening the scope of digital asset activities expressly acknowledged as permissible for national banks.1
Interpretive Letter 1184: Cryptoasset Custody Services
In May 2025, the OCC confirmed that national banks and federal savings associations may engage in the purchase or sale of digital assets held in custody at the custodial customer’s direction. The OCC further confirmed that national banks and federal savings associations may outsource permissible digital asset activities, including custody and execution services, to third parties so long as appropriate third-party risk management practices are in place.
Interpretive Letter 1186: Paying Cryptoasset Network Fees and Holding Cryptoassets as Principal
In November 2025, the OCC confirmed that national banks may pay blockchain network fees (commonly known as “gas fees”) in connection with otherwise permissible activities and may hold digital assets as principal (i.e., on balance sheet) in amounts necessary to make such reasonably foreseeable payments. The OCC additionally clarified that national banks may hold digital assets as principal in amounts needed to test otherwise permissible digital asset platforms, whether internally developed or obtained from a third party.
Interpretive Letter 1188: Riskless Principal Transactions in Cryptoassets
In December 2025, the OCC confirmed that national banks may engage in riskless principal digital asset transactions on behalf of their customers. In such transactions, as distinct from agency transactions, a bank enters into two offsetting trades as principal, with the net result being that the bank generally does not hold digital assets in inventory and does not retain market exposure to the assets.
OCC Release of Nonobjection Requests
In March 2025, the OCC rescinded Interpretive Letter 1179, which required formal supervisory nonobjection (SNO) from the regulator before a national bank or federal savings association could undertake certain digital asset activities. Later, in connection with a report to Congress on debanking in December 2025,2 the OCC published a chart summarizing each formal SNO request submitted by an OCC-supervised institution under Interpretive Letter 1179 from the letter’s issuance on November 18, 2021, to its rescission on March 7, 2025, including the OCC’s response where applicable. Of the 21 SNO requests during this period, nine resulted in the OCC providing SNO. Eight of the nine granted requests involved the use of an internal blockchain to support financial transactions, and the remaining granted request involved the provision of traditional issuing and paying agent services to issuer clients, where those clients used a third-party clearinghouse’s private permissioned distributed ledger technology network to issue notes. Most of the remaining requests were withdrawn by the applicants in the face of agency resistance to expanded digital asset activities.
OCC Proposal to Clarify Chartering Authority for National Trust Banks
On January 8, the OCC issued a proposed rulemaking to clarify its longstanding authority to charter national banks limited to the operations of trust companies and activities related thereto, including to engage in nonfiduciary activities in addition to their fiduciary activities. The proposal would neither expand nor contract the OCC’s authority to charter a national bank but seeks to address ambiguity regarding how the OCC interprets its authority to charter banks under the National Bank Act. Comments on all aspects of the proposed rule are due 30 days after it is published in the Federal Register.
Federal Reserve Replacement of 2023 Section 9(13) Policy Statement
In February 2023, the Federal Reserve adopted a policy statement interpreting Section 9(13) of the Federal Reserve Act with respect to the Federal Reserve’s regulation of “novel and unprecedented activities” engaged in by state member banks. Section 9(13) of the Federal Reserve Act describes the manner in which activities of state member banks may be regulated and provides that the Federal Reserve may limit the activities of such banks to those permissible for national banks. The 2023 policy statement established a presumption that state member banks, whether insured or uninsured, would be limited to activities permissible for national banks or otherwise authorized by federal statute or FDIC regulation, even where broader activities were authorized under the laws of the state that chartered the bank. In practice, this limited the ability of state member banks to pursue novel or innovative activities, including certain digital asset activities.
In December 2025, the Federal Reserve rescinded the 2023 policy statement and withdrew its accompanying discussion of digital asset activities in response to an “evolving understanding of the risks of the crypto-asset sector” and a desire to facilitate innovation in the industry consistent with preserving the stability of the U.S. financial system. The Federal Reserve simultaneously adopted a new policy statement articulating a principles-based approach to the exercise of its authority under Section 9(13). Under the new framework, the Federal Reserve generally permits insured state member banks to engage in activities that are permitted for national banks or otherwise authorized by the FDIC for state banks (whether by regulation or special application). With respect to uninsured member banks seeking to engage in activities not permitted for national banks or otherwise authorized by the FDIC, the Federal Reserve emphasizes a supervisory assessment focused on risk, safety and soundness, and financial stability rather than categorical presumptions based on national bank powers. The new policy reflects a shift toward evaluating activities based on their risk profile and the institution’s ability to manage those risks, creating greater regulatory flexibility for member banks as they consider emerging business models, including those involving digital assets and payment innovation.
Federal Reserve Request for Information on New “Payment Accounts”
Federal Reserve master accounts provide institutions with the ability to hold balances at a Federal Reserve Bank and directly access services such as Fedwire and ACH. While traditional banks have long had such access, proposals for access by nontraditional or narrowly focused institutions have prompted heightened scrutiny from the Federal Reserve. This scrutiny reflects regulatory questions about eligibility, risk management, and the appropriate regulatory perimeter of the Federal Reserve System.
Against this backdrop, the Federal Reserve Board voted in December 2025 to seek public comment on a proposed special purpose “payment account” framework. These accounts, often referred to as “skinny master accounts,” would be more limited than traditional master accounts and would have the primary purpose of supporting the clearing and settling of payment activity. The payment account concept signals the Federal Reserve’s willingness to reconsider how access to core payment infrastructure might be structured for institutions pursuing innovative payment models, including those related to digital assets and tokenized payments, while limiting broader balance sheet, credit, or risk exposures traditionally associated with full master accounts. At the same time, the request for comment underscores that several questions remain unresolved, including eligibility standards, permissible uses, operational constraints, and the relationship between payment accounts and existing master account policies. How the Federal Reserve ultimately resolves these issues (e.g., by excluding ACH from the proposal) may have significant implications for banks, bank-adjacent entities, and payments-focused institutions seeking more direct participation in the U.S. payment system.
Treasury Seeks Input on GENIUS Act Implementation
In September 2025, the Treasury published an ANPRM seeking public comment on questions relating to the implementation of the GENIUS Act. The ANPRM invited comments across a broad set of issues that may inform Treasury’s forthcoming rulemaking under the GENIUS Act, including regulatory clarity, prohibitions on certain issuances and marketing, anti-money-laundering and sanctions obligations, the balance of state and federal oversight, comparability of foreign regulatory regimes, and tax implications.
Treasury’s ANPRM posed questions organized into key topic areas such as stablecoin issuers and service providers, illicit finance, foreign payment stablecoin issuers, taxation, insurance, and economic data and also sought input on definitions and potential safe harbors under the GENIUS Act. Commenters were encouraged to address how best to implement statutory provisions, including protections for consumers and financial stability, as well as Treasury’s role as chair of the Stablecoin Certification Review Committee. The comment period was extended to and closed on November 4, 2025.
As an ANPRM, Treasury’s notice does not create binding requirements but was intended to inform the development of future notices of proposed rulemaking and regulations under the GENIUS Act. Treasury’s solicitation of comments will be followed by one or more NPRMs addressing specific aspects of GENIUS Act implementation and shaping the stablecoin regulatory framework.
FDIC Issues NPRM on Bank-Issued Payment Stablecoins
In December 2025, the FDIC approved an NPRM that would establish application procedures for FDIC-supervised institutions (including state nonmember banks and state-chartered savings associations) seeking to issue payment stablecoins through an approved subsidiary under the GENIUS Act. The FDIC’s proposed rule is the FDIC’s first formal step in implementing the GENIUS Act’s stablecoin framework for bank-linked stablecoin issuance.
The NPRM outlines eligibility criteria, application requirements, review timelines, and appeal rights. Applicants would be required to submit detailed information regarding the business plan for stablecoin issuance, financial information, governance and control arrangements, and relevant information for the FDIC to evaluate risk controls and compliance readiness for stablecoin issuance.
Key open questions include how the FDIC will apply and evaluate safety and soundness standards in practice and how future rulemakings under the GENIUS Act will shape the broader regulatory environment for stablecoin issuance. For additional detail, see our previous Sidley Update.
1 See OCC Interpretive Letter 1186 (Nov. 18, 2025); OCC Interpretive Letter 1188 (Dec. 9, 2025).
2 See https://occ.gov/news-issuances/news-releases/2025/nr-occ-2025-114.html.
