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Interpretive Letter 1174 explains how banks may use new technologies, including independent node verification networks (INVNs) and stablecoins, to perform bank-permissible functions, such as payment activities. Said simply, a bank may use stablecoins to facilitate payment transactions for customers. In doing so, a bank may issue stablecoins, exchange stablecoins for fiat currency, as well as validate, store, and record payments transactions by serving as a node on a blockchain (INVN).
Kristin Smith, Executive Director of the Blockchain Association noted to me, “ The OCC’s interpretive letter shows that there are those in government who actually understand that cryptocurrency networks are the foundation of a next generation payments system. Stablecoins, like USDC, can power faster, 24-hour real time payments in a way that existing US payments infrastructure can’t handle.”
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