The U.S. Currency Control Bureau (OCC) said yesterday that banks can use stablecoins to run payments and other activities.
The agency released an interpretative letter stating whether national banks and federal savings associations can participate in independent node verification networks (INVNs, aka blockchain networks) or use stablecoins. The letter stated that these financial institutions could join a blockchain as a node and store or verify payments.
It was stated that any bank participating in an INVN should be aware of operational, compliance or fraud risks in doing so. Still, OCC said INVNs could “be more flexible than other payment networks” due to the large number of nodes required to validate transactions, which could limit tampering.
“Blockchain Association has the same status as other global financial networks such as SWIFT, ACH and FedWire,” said Kristin Smith, executive director of the Blockchain Association, on Twitter. Deputy Currency Officer Brian Brooks said in a statement that while other countries are setting up real-time payment systems, the United States “trusts” the private sector to create such technologies and apparently approves the use of cryptocurrencies, especially stablecoins.