Today, the OCC released an interpretive letter concluding that national banks and federal savings associations (together, “banks”) may permissibly provide cryptocurrency custody services for customers. The letter, written by Chief Counsel Jonathan Gould, describes custody of cryptocurrency as a modern form of the traditional banking activity of providing safekeeping and custody services, which the agency has previously permitted banks to conduct through electronic means. The letter also “reaffirms the OCC’s position that national banks may provide permissible banking services to any lawful business they choose, including cryptocurrency businesses, so long as they effectively manage the risks and comply with applicable law.”
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Distributed Ledger
ISDA Releases Whitepaper Regarding Legal Perspectives on Smart Contracts and Distributed Ledger Technology
By Mike Nonaka & David Stein on
Posted in Blockchain, Fintech
On August 3, 2017, the International Swaps and Derivatives Association (“ISDA”) and Linklaters LLP released a whitepaper titled “Smart Contracts and Distributed Ledger – A Legal Perspective.” The whitepaper sets out to define the terms “smart contract” and “distributed ledger,” to analyze their applications to the derivatives industry, and to highlight potential legal…
Federal Reserve Board Releases Research Paper on Digital Ledger Technology
By David Stein on
The Federal Reserve Board released a staff research paper on Monday, December 5, 2016, addressing the potential use of distributed ledger technology (DLT) in payments, clearing, and settlement (PCS) processes. A distributed ledger is a type of database in which identical copies of information are distributed and maintained among multiple parties or multiple nodes in a computer network. Uses of DLT include the transfer of cryptocurrencies, like Bitcoin.
The paper (i) describes the current state of DLT; (ii) identifies opportunities to use digital ledgers in PCS processes; (iii) delineates the practical challenges to implementing DLT; and (iv) outlines potential legal and risk management concerns related to DLT.
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