What banks and credit unions can do with digital assets under §401 of the CLARITY Act

For most of the last decade, banks and credit unions interested in digital asset services operated under a patchwork of OCC interpretive letters, state-by-state guidance, and limited NCUA direction. OCC Interpretive Letters 1170 (rescinded 2025), 1183, 1186, and 1188 progressively clarified custody and riskless principal activities for national banks. Comprehensive permissibility guidance — uniform across charters — had not materialized.

The CLARITY Act addresses that gap at the statutory level rather than waiting for further agency interpretation. The bill is the Senate Banking Committee's companion to last year's GENIUS Act, which established the federal framework for payment stablecoins.

Implementing rules. Statutory authorization is necessary but not sufficient. The federal banking agencies — Fed, OCC, FDIC — and NCUA retain safety-and-soundness supervisory authority under §401(i). Each agency may issue further guidance on capital, concentration, and risk-management expectations. Section 403 requires the federal banking agencies to develop netting-agreement capital rules within 360 days of enactment.

Section 404 stablecoin yield. Section 404, which prohibits payment stablecoin issuers and digital asset service providers from paying deposit-like interest or yield on payment stablecoin balances, remains contested. The banking trade associations (ABA, ICBA, BPI, and others) have asked for §404 to be tightened to prevent indirect "rewards" that could function as yield. The digital asset industry has asked for it to be loosened. The final language is not yet settled.

National bank carve-out. §401(c)(2) excludes §401(g)(6) (purchasing or selling digital assets as principal for investment or trading) from the national bank "business of banking" authorization. National banks receive every other authorized activity. Financial holding companies and credit unions are not subject to this carve-out.

State credit union scope. State CUs receive the §401(e) activities under §401(f), subject to state law and any NCUA limitations on insured CUs. Individual state postures and any subsequent NCUA guidance will shape the practical scope.