The U.S. Office of the Comptroller of the Currency, or OCC, has taken another step toward defining how regulated banks can participate in digital asset infrastructure. In its newly issued Interpretive Letter 1186, the agency said national banks may hold crypto on their balance sheets when the purpose is to pay blockchain network fees, including the gas fees required to process on-chain transactions.
The guidance also says banks may keep crypto on hand to test internal crypto systems or third-party crypto platforms. This is an important distinction. The OCC is not opening the door to unrestricted speculative crypto exposure by banks. Instead, it is recognizing that if a bank wants to provide lawful blockchain-related services, it may need access to native network tokens in order to operate those services in practice.
On blockchain networks, native tokens are often required to move assets, settle transactions, or execute smart contract functions. Whether a bank is facilitating transfers, supporting custody workflows, or helping clients complete blockchain transactions, network fees are unavoidable. The OCC’s position is that banks may hold the amount of crypto they reasonably anticipate needing for those purposes.
The agency also made clear why this matters operationally. If banks cannot hold the required tokens themselves, they may need to rely on outside providers to pay fees or perform basic on-chain actions on their behalf. That dependence can increase operational complexity, introduce counterparty exposure, and make workflows less efficient. Allowing banks to retain limited amounts of crypto for fee payments gives them more direct control over the services they provide.
In the OCC’s own language, paying network fees is a necessary part of doing business on blockchain networks, and holding crypto for that purpose is permissible when it supports otherwise lawful banking activities. That framing gives banks a more concrete legal basis for handling a practical issue that comes up in custody, settlement, and client transaction support.
Why the OCC calls this an “incidental” banking activity
The most important regulatory concept in the letter is the OCC’s description of these actions as being “incidental to the business of banking.” In U.S. banking law, that phrase carries real weight. It means an activity is legally permitted when it is connected to, and supportive of, recognized banking functions such as serving customers, facilitating transactions, or operating efficiently and safely.
In other words, the OCC is not saying banks are free to hold crypto for open-ended investment purposes. It is saying that if holding a limited amount of crypto is necessary to perform a lawful banking service, that holding can itself be lawful. For compliance teams, legal departments, and internal auditors, this distinction is crucial because it defines both the legal rationale and the operational boundary.
The OCC reinforced its reasoning by comparing crypto holdings for network operations to historical banking practices. Banks have long held foreign currency, banknotes, or interests in payment systems when those assets were needed to facilitate transactions. From the regulator’s perspective, crypto is not a completely alien category here. It is simply a new form of asset required to interact with a new kind of payment and settlement network.
That comparison matters because it places blockchain operations within a recognizable banking tradition. Banks have always needed to hold certain tools, balances, or settlement-related assets in order to execute services for customers. If a blockchain network requires its native token for transaction execution, then modest holdings of that token can be viewed in a similar operational light.
The broader signal is that regulators increasingly see blockchain networks not just as speculative venues but as emerging infrastructure. By using established banking logic to explain blockchain fee payments, the OCC is giving traditional financial institutions a clearer conceptual bridge between conventional finance and on-chain systems.
What banks are allowed to do under Letter 1186
Interpretive Letter 1186 does not authorize unlimited crypto activity. Instead, it permits banks to hold the amount of digital assets they “reasonably anticipate” needing. That standard is designed to tie any holdings directly to actual business demands. A bank providing crypto custody, for example, may need network tokens to process withdrawals, transfers between custody addresses, or asset movements on behalf of clients.
Likewise, a bank helping facilitate client crypto transactions may need access to native blockchain tokens in order to complete the underlying on-chain actions. The same principle applies to technical testing. If a bank is developing internal systems or evaluating a third-party crypto platform, it may need to perform real or near-real network actions in order to confirm functionality, security, and process integrity.
This technical testing allowance is especially meaningful for financial institutions building digital asset capability. Before a product launches, banks typically run extensive tests around system integration, transaction approvals, permissions, settlement logic, custody workflows, and exception handling. Without access to the native token required by a blockchain, many of those tests cannot be completed in a realistic way.
Operationally, the guidance may also reduce dependence on external intermediaries. If every blockchain fee must be paid by a third party, banks may lose some control over timing, transparency, reconciliation, and failure response. By holding a small, purpose-specific amount of crypto themselves, banks may be able to incorporate these steps into established internal controls and service-level processes.
Still, the boundaries are clear. The OCC’s logic is based on necessity, reasonableness, and a link to lawful banking services. Banks will need to show that the tokens they hold, the quantities involved, and the use cases they support are all tied to real operational needs rather than speculative positioning.
Risk management remains central to the OCC’s approach
Even as it becomes more open to crypto-related banking activity, the OCC has not relaxed its expectations on risk controls. The agency said banks must carefully manage operational, market, liquidity, cybersecurity, and legal risks associated with holding digital assets for network fee purposes. This reflects the regulator’s broader view that permission and prudence must go together.
Operational risk covers process design, internal approvals, segregation of duties, reconciliation, and the reliability of execution. Market risk is relevant because even limited crypto balances can fluctuate in value, which may affect accounting treatment or create exposure if holdings are not tightly managed. Liquidity risk matters as well, since a network token needed for fees may not always be available on ideal terms at the exact moment it is required.
Cybersecurity risk is especially significant in any crypto context. If a bank holds native tokens, it must also manage wallets, keys, signing processes, transaction authorization, and controls around who can move assets and under what conditions. A failure in key management or a compromise of internal systems could lead to direct on-chain loss, which is often more difficult to reverse than errors in traditional account-based infrastructures.
Legal risk remains equally important. Banks must ensure they understand the regulatory basis for each use case, how client instructions are documented, what records are retained, and how all relevant compliance obligations are met. The OCC’s message is not merely that banks may hold crypto, but that they must do so within a disciplined governance framework.
The agency also stated that the amount of crypto held should remain minimal relative to a bank’s capital. That limitation is one of the clearest indicators that the OCC is permitting functional holdings, not encouraging broad balance-sheet exposure. Banks may hold enough to support services, but they are not being invited to take large directional positions in volatile digital assets.
Jonathan Gould’s OCC and the broader U.S. regulatory backdrop
The timing of the letter is also notable. The article states that the OCC issued this guidance under Comptroller Jonathan Gould, a Trump appointee who was confirmed in July 2025. Under his leadership, the agency has become more crypto-friendly, at least in the sense of providing clearer pathways for lawful bank participation in digital asset services.
Before this latest move, the OCC had already issued guidance allowing banks to act as nodes on blockchain networks, provide crypto custody services, and work with stablecoins. That pattern suggests a cumulative policy strategy rather than a one-off exception. The regulator appears to be building an architecture in which banks can gradually participate in blockchain-based financial activity without abandoning core supervisory standards.
At the same time, the broader U.S. rulebook remains unfinished. The article notes that more expansive rules for stablecoin issuers are still being drafted under the GENIUS Act. So while the federal regulatory environment is not yet fully settled, the OCC is moving ahead in areas where it can define concrete banking permissions and expectations.
This is a pragmatic form of regulatory development. Instead of waiting for a comprehensive national framework to be completed before saying anything useful, the OCC is clarifying what banks may do today, why those actions fit within existing banking law, and what guardrails need to be in place. That can be highly valuable for institutions that are willing to move carefully but need regulatory certainty before investing in systems and compliance.
As more banks evaluate digital assets, stablecoin settlement, and blockchain-based custody or payment rails, this kind of guidance may speed adoption. In many cases, the biggest barrier is not technology itself but uncertainty over what a supervised institution is allowed to do. By reducing that uncertainty, the OCC is helping connect traditional finance with blockchain infrastructure in a more operationally realistic way.
How Letter 1186 fits with the earlier Letter 1184
The article also points to an earlier development from this year: Interpretive Letter 1184. In that guidance, the OCC allowed national banks and federal savings associations to offer cryptocurrency custody and trading services. This is an important reference point because it shows that Letter 1186 is not an isolated policy shift but part of a broader expansion in what regulated banks may do in crypto-related business lines.
Under Letter 1184, banks can essentially buy and sell digital assets on behalf of customers, outsource crypto-related activities to third parties, and provide associated services such as recordkeeping, tax reporting, and compliance support. That framework already moved banks beyond simple asset safekeeping and toward a fuller service model around digital assets.
When viewed together, Letters 1184 and 1186 form a more coherent regulatory path. If banks are allowed to offer custody, trading, outsourced support, recordkeeping, tax reporting, and compliance services tied to crypto, they will inevitably encounter on-chain transaction costs and infrastructure testing needs. Permitting them to hold the required network tokens closes a practical gap in that service model.
For the market, this does not necessarily mean U.S. banks will immediately place large volumes of crypto on their balance sheets or roll out expansive retail offerings overnight. What it does mean is that an important layer of operational friction has been reduced. Banks now have clearer support for handling the token balances necessary to execute lawful blockchain-related services.
Over time, that kind of incremental clarity can matter more than headline-grabbing announcements. It helps legal teams design policies, gives risk officers a framework to supervise activity, and makes it easier for technology and operations teams to build systems that fit within known regulatory boundaries. In that sense, the OCC’s latest move may prove meaningful precisely because it addresses a small but unavoidable part of real-world blockchain banking operations: the need to pay for the network itself.