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Navigating OCC and CFTC reforms: impact on Australia's Digital Asset landscape

The digital asset sector is evolving rapidly, shaped by regulatory changes across the globe. Recent reforms by the U.S. Office of the Comptroller of the Currency (OCC) and the Commodity Futures Trading Commission (CFTC) are creating ripples far beyond American borders. For Australia, a country with a growing digital asset market, understanding these reforms is crucial. This post explores how OCC and CFTC regulatory shifts influence Australia's digital asset environment, what they mean for investors, businesses, and regulators, and how Australia can adapt to maintain a competitive edge.



Eye-level view of a modern Australian city skyline with digital asset symbols floating above
Australian city skyline with digital asset symbols, representing the impact of international reforms on local markets


1. What the OCC proposed

On 9 December 2025 the OCC issued News Release 2025-121 and Interpretive Letter 1188. It confirms that:

  • A US national bank may engage in riskless principal crypto-asset transactions as part of the “business of banking”.

  • In these transactions the bank acts as principal to buy crypto from one customer and, simultaneously, sells to another customer, entering offsetting trades so that it does not hold inventory beyond the instant needed to complete the match – “equivalent to that of a broker acting as agent.” OCC.gov+2Reuters+2

  • The usual proviso applies, activities must be conducted in a safe and sound manner and in compliance with applicable law. OCC.gov

In context, 2025 has also seen:

  • An earlier OCC letter confirming banks can hold small amounts of crypto as principal to pay network fees (e.g. gas). OCC.gov

  • The Fed, FDIC and OCC withdrawing 2023 “crypto risk” statements that effectively discouraged banks from crypto altogether. Reuters+1

Meaning in practice

  • The OCC has explicitly re-opened the door for banks to be intermediaries in crypto markets, but in a way that keeps balance-sheet risk tightly controlled.

  • Crypto brokerage and order-routing together become a permissible, ordinary banking service, rather than something requiring ad hoc pre-approval or being implicitly discouraged.

  • Combined with the pull-back of “de-risking” guidance, it is also a strong signal that “de-banking” of lawful crypto businesses is no longer acceptable policy.

2. What the CFTC proposed

On 8 December 2025 (widely reported on 9 December) the CFTC announced a Digital Assets Pilot Program for tokenized collateral and related guidance/no-action relief. CoinDesk+3Commodity Futures Trading Commission+3PYMNTS.com+3

Key elements:

  1. Pilot program for tokenized collateral

    • Certain digital assets – explicitly BTC, ETH and USDC in the initial phase – can be used as margin collateral in CFTC-regulated derivatives markets (via FCMs). Commodity Futures Trading Commission

    • This sits within existing futures/swaps framework; rules are stated to be technology-neutral (tokenized vs traditional form). Commodity Futures Trading Commission

  2. Guidance on tokenized collateral

    • Staff guidance explains how tokenized assets (including tokenized Treasuries and money market funds) can qualify as eligible collateral, dealing with:

  3. No-action letter for FCMs using non-securities digital assets as margin

    • A no-action position allows FCMs to accept digital assets (initially BTC, ETH, USDC) as customer margin collateral and to hold certain payment stablecoins in segregated accounts, subject to stringent reporting and risk-management conditions. Commodity Futures Trading Commission+1

    • The CFTC is using the pilot phase to collect granular data and monitor risk rather than prohibit the activity.

  4. Withdrawal of prior restrictive advisory

    • CFTC Staff Advisory 20-34, which had restricted FCMs from accepting virtual currencies as margin collateral, has been withdrawn as outdated, given market and legal developments (including the GENIUS Act). Commodity Futures Trading Commission

Meaning in practice

  • The CFTC is now formally integrating digital assets into mainstream, supervised derivatives markets, not as a curiosity but as eligible collateral with a rules-based framework.

  • It uses the familiar tools – guidance + no-action + pilot – to lower barriers while still maintaining a prudential lens.

  • Symbolically, it says: crypto should migrate from offshore, unregulated venues into on-shore, supervised infrastructure.

3. Combined signal from OCC + CFTC

Taken together, the two statements mean:

  1. Institutional on-ramps are unlocked

    • Banks can intermediate crypto for customers.

    • FCMs can accept crypto and tokenized assets as collateral.

    • Both occur inside existing regulatory perimeters, not via bespoke new regimes.

  2. Shift from “precautionary hostility” to “risk-based incorporation”

    • Earlier US guidance that effectively treated crypto as presumptively toxic has been withdrawn or softened. Reuters

    • The new stance is:

“You may do this, if you can manage the risks under existing prudential, markets and conduct frameworks.”

  1. Political and competitive dimension

    • The Trump administration is overtly positioning the US as seeking to be the “crypto capital of the world”, and regulators are now executing on that policy direction. Reuters+1

    • There is an explicit concern about US users being driven to offshore, unregulated platforms, and these measures are meant to pull activity back onshore. Commodity Futures Trading Commission

4. Where Australia is now

Australia has moved, but more cautiously and with a more fragmented architecture:

  • Token mapping & platform regulation

    • Treasury’s token-mapping exercise (2023) explicitly sought to map existing law onto crypto rather than creating a new taxonomy. Treasury+1

    • Treasury has since released exposure draft legislation to regulate “digital asset platforms” and “tokenised custody platforms” as new types of financial products under the Corporations Act, requiring an AFSL and core obligations. Consult hub+2Treasury Ministers+2

  • ASIC guidance and AFSL perimeter

    • ASIC’s updated INFO 225 (finalised 2025) and CP 381 clarify when crypto/digital assets are financial products and set expectations for AFS licensees in custody, staking, and tokenised arrangements. ASIC+2ASIC+2

  • Tax treatment

    • The Board of Taxation completed its review of digital assets and transactions; the government published its response in March 2025, broadly committing to incremental reforms built on existing tax law (crypto treated as CGT assets rather than foreign currency, etc.). Reuters+3Taxation Board+3Taxation Board+3

  • Digital asset strategy & de-banking concerns

    • The Albanese government has articulated a “four-pillared” strategy: licensing, custody, tax, and debanking, with an explicit intention to address de-banking of crypto firms through engagement with banks and regulators. The Australian

  • Payments & stablecoins

    • Work is ongoing on payment system modernisation and a stablecoin/stored-value licensing regime, but draft legislation is still in train rather than enacted. Gilbert + Tobin+1

So, Australia is mid-transition: substantial consultation and exposure drafts, but not yet at the point where ADIs and central counterparties have clear, positive frameworks comparable to the new OCC/CFTC stance.

5. What Australia should / could do to remove regulatory barriers

Below are concrete moves that would bring Australia closer to the OCC/CFTC posture, while remaining consistent with our existing regulatory architecture (AFSL, APRA standards, PPSA, ATO, etc.).

A. Banking: clarify that ADIs can intermediate crypto on a risk-based basis

  1. APRA/ASIC joint guidance akin to the OCC letter

    • Issue a prudential practice guide or information paper explicitly stating that ADIs may:

      • intermediate riskless principal crypto transactions for customers (acting as matched principal without holding trading inventory);

      • hold limited crypto-asset positions to pay network fees, test systems, and support custody/tokenised settlement services.

    • Make clear this is permissible, not discouraged, provided it is done within existing CPS/APR standards (capital, liquidity, operational risk, CPS 234, etc.), rather than requiring bespoke approvals every time.

  2. Address “de-banking” as a supervisory priority

    • Following the OCC’s findings on debanking disfavoured industries (including crypto), Reuters+1 Australian regulators could:

      • Require ADIs to document risk-based rationales when terminating or denying relationships with crypto firms.

      • Treat unexplained, sector-wide de-banking as a conduct and competition issue, to be escalated via Council of Financial Regulators and, if necessary, the ACCC.

    • This could be inserted into APRA’s prudential standards or guidance as an expectation of non-discriminatory access, aligned with AML/CTF obligations.

  3. Sandbox / restricted ADI regimes for crypto-native firms

    • Offer a restricted ADI / payment institution pathway for qualifying digital asset firms that meet prudential and governance criteria, mirroring the OCC’s openness to digital asset firms seeking bank charters. OCC.gov+1

    • This directly addresses the “you must bank with us, but we won’t bank you” problem.

B. Digital asset platforms & AFSL: accelerate clarity and proportionality

  1. Fast-track and refine the digital asset platform bill

    • Finalise and enact the digital asset platforms / tokenised custody platforms legislation with: Treasury Ministers+2Consult hub+2

      • Clear thresholds (size, activities) with lighter-touch regimes for small or wholesale-only providers.

      • A formal transition/no-action period, similar to ASIC’s contemplated class “no-action” for transition, to avoid a regulatory cliff. ASIC+1

  2. Explicit path for spot crypto and tokenised products on licensed markets

    • Provide guidance and, where necessary, amendments to allow:

      • spot BTC/ETH products (e.g. ETPs/ETFs) and tokenised real-world asset products to be listed on licensed markets under clear custody, disclosure, and market-integrity rules, drawing on the CFTC’s technology-neutral tokenized collateral guidance. Commodity Futures Trading Commission+1

    • This reduces the regulatory arbitrage between offshore and onshore platforms.

  3. Harmonise AML/CTF expectations

    • Coordinate AUSTRAC guidance with ASIC/ APRA so that AML/CTF expectations are consistent across banks, platforms, and custodians, reducing the “everyone over-de-risks to be safe” dynamic that drives de-banking.

C. Derivatives & collateral: follow the CFTC’s pilot approach

  1. Allow crypto and tokenized assets as collateral in CCPs under pilot conditions

    • ASIC and the RBA (as overseer of clearing and settlement) could create a framework under which ASX Clear, ASX Clear (Futures) or new CCPs may:

      • accept tightly-defined digital assets (e.g. BTC, ETH and AUD or USD stablecoins meeting specified criteria) as margin collateral for certain products;

      • apply conservative haircuts and concentration limits;

      • report aggregate usage and risk metrics regularly, as the CFTC requires of FCMs. Commodity Futures Trading Commission+1

    • Importantly, this would be done as a pilot, allowing regulators to gather data and adjust.

  2. Tokenised government securities and money market funds

    • Mirror the CFTC guidance for tokenised Treasuries and money market funds by: Commodity Futures Trading Commission

      • issuing joint ASIC/RBA guidance on how tokenised Australian Government Securities (AGS) and regulated money market funds can qualify as eligible collateral;

      • clarifying legal enforceability, custody/segregation expectations, and operational risk controls around on-chain settlement.

D. PPSA and “control” over digital assets

  1. Introduce a “digital asset” control regime under the PPSA

    • To align collateral law with the CFTC/OCC move toward treating digital assets as acceptable collateral, Australia should:

      • define “digital asset” (with sub-categories such as crypto-asset, stablecoin, tokenised security) in the PPSA;

      • create a perfection-by-control regime analogous to investment instruments/ADI accounts, recognising that possession is not meaningful on-chain;

      • specify what constitutes control (e.g. sole access to private keys, contractual control over a regulated custodian, multi-sig structures).

    • This would give banks and CCPs the legal comfort to treat crypto as high-quality collateral where appropriate, removing one of the biggest practical barriers even if prudential rules are otherwise supportive.

E. Tax and accounting: remove distortions that block institutional use

  1. Implement Board of Taxation recommendations with a collateral lens

  2. When finalising changes following the Board of Taxation review, the government should deliberately: Taxation Board+1

    • avoid tax treatments that penalise use of digital assets as collateral or settlement assets (e.g. CGT events on routine collateral movements where there is no economic disposal);

    • consider foreign-currency or financial-arrangement-like treatment for specific classes (e.g. prudentially regulated stablecoins) to align with their functional use in markets.

  3. Clarify accounting for tokenised collateral

  4. Issue AASB guidance (or interpretations) on how regulated entities should account for tokenised collateral and customer digital assets, to reduce uncertainty that currently deters banks and CCPs from engaging.

F. Payments, stablecoins and tokenised deposits

  1. Complete the stablecoin / stored-value framework

  2. Finalise legislation and APRA standards for payment stablecoins and tokenised deposits as stored-value facilities, with: Gilbert + Tobin+1

    • clear capital, reserve, and asset-backing requirements;

    • recognition of high-quality AUD and USD stablecoins as potential wholesale settlement and collateral instruments in line with the CFTC’s treatment of payment stablecoins as eligible margin.

  3. Coordinate with RBA on wholesale tokenised settlement

  4. Use ongoing RBA pilots on tokenised settlement and CBDC/wholesale settlement tokens to ensure that regulatory frameworks around on-chain settlement in AUD dovetail with digital asset platform and collateral reforms.

G. Process and governance: avoid fragmentation

  1. Issue an Australian “Digital Assets Regulatory Roadmap”

  2. Treasury, ASIC, APRA, RBA and AUSTRAC could jointly publish a roadmap that:

    • consolidates token mapping, the digital asset platform regime, payment system modernisation and tax changes;

    • sets out concrete milestones (e.g. by 2027, ADIs may intermediate riskless principal crypto, CCPs may accept certain digital assets as collateral under a pilot, stablecoin framework fully in force, etc.).

  3. Establish a standing Digital Assets Advisory Council

  4. Similar to the CFTC’s Digital Asset Markets Subcommittee and Crypto CEO Forum, Commodity Futures Trading Commission create a structured channel for industry, consumer groups and technologists to feed into regulatory adjustments, reducing the tendency towards over-cautious “set and forget” rules.

6. Bottom line

  • The OCC statement normalises banks as crypto brokers/intermediaries under standard banking law.

  • The CFTC statement normalises crypto and tokenised assets as collateral in mainstream, regulated derivatives markets.

  • Together, they move the US from using regulation as a barrier to using it as a framework for safe participation.

For Australia to remove its own regulatory barriers, and remain competitive with this new US stance, the key is to:

  1. Give banks and CCPs explicit, risk-based permission to intermediate and accept digital assets, rather than leaving them in a grey zone;

  2. Finish and integrate the digital asset platform, stablecoin and tax reforms with a clear, technology-neutral collateral and custody framework; and

  3. Fix the plumbing issues (PPSA control, debanking, AML/CTF alignment, accounting) that currently make it unattractive or impossible for mainstream institutions to engage, even where the law does not formally forbid it.

 

 
 
 

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