CLIENT ALERT
June 29, 2026
Read time: 6 min
On June 9, 2026, the US Office of the Comptroller of the Currency (OCC) issued Interpretive Letter 1192 (Letter 1192), providing one of the clearest statements to date on the relationship between national bank powers and state money transmitter license (MTL) laws.1 The OCC concluded that the National Bank Act (NBA)preempts state MTL requirements when applied to a national bank, including an uninsured national trust bank.2 Letter 1192 holds that national banks may engage in federally authorized activities without obtaining state MTLs, even where state law would otherwise require licensure.3
Background and context
Letter 1192 arose from a request from Fidelity Digital Assets, National Association (Fidelity) for the OCC to confirm that the NBA preempts state laws requiring Fidelity to hold a state MTL.4 On December 12, 2025, the OCC approved Fidelity’s conversion from a New York limited liability trust company regulated by the New York State Department of Financial Services to an uninsured national bank with operations limited to those of a trust company or activities related thereto under 12 U.S.C. § 27(a) (i.e., a national trust bank).5 Fidelity subsequently informed the Iowa Division of Banking (IDOB) that it intended to surrender its Iowa MTL. In response, IDOB requested that Fidelity provide the legal basis for doing so, noting that Iowa law exempts from its MTL requirements only banks or trust companies with federally insured deposits, which Fidelity does not maintain.6
Federal preemption of state money transmitter laws
Relying on Barnett Bank v. Nelson and Cantero v. Bank of America, the OCC explained that a state law is preempted when it “prevents or significantly interferes” with a national bank’s exercise of its powers.7 In Watters v. Wachovia Bank, N.A., the Supreme Court of the United States similarly found that a state law conditioning a national bank’s exercise of federal powers on state registration “would surely interfere with” the bank’s exercise of those powers.8
The OCC further emphasized that the NBA limits visitorial powers over national banks to those authorized by federal law.9 The OCC cited Supreme Court and other federal court precedents defining “visitorial powers” to include examining how a bank conducts its business; enforcing compliance with applicable laws and regulations; exercising general supervision and control over the institution; overseeing corporate affairs; and inspecting, directing, regulating, or otherwise superintending the bank’s operations.10
Applying these principles, the OCC stated that “the application of Iowa’s money transmitter licensing requirement to [Fidelity] clearly prevents or significantly interferes with its exercise of its federally authorized powers and, as such, is preempted by the National Bank Act.”
The OCC concluded that Iowa’s MTL requirement is preempted because it would subject Fidelity to state “visitorial powers,” including reporting, record production, examination, and enforcement authority.11 According to the OCC, such oversight is “fundamentally inconsistent with the OCC’s exclusive visitorial powers under 12 U.S.C. § 484.”12
Importantly, the OCC made clear that its analysis was not limited to Iowa. Letter 1192 states that the same reasoning applies to “any similar state requirements.”13 By grounding its analysis in long-standing preemption precedent, the OCC signaled that its conclusion is rooted in traditional NBA preemption principles, not a digital asset-specific exception, and is therefore broadly applicable to any national bank engaged in money transmission activities, including those operating in the digital asset space.14
Practical implications for digital asset firms and banks
Since 2025, the OCC has conditionally approved several national trust bank charter applications from digital asset firms.15 Letter 1192 carries significant practical weight for digital asset firms that have obtained, or are considering obtaining, a national bank or national trust bank charter. Letter 1192 provides a clear regulatory basis for national trust banks engaged in digital asset custody, stablecoin issuance, or blockchain-based payment services to operate without state MTLs, reducing the compliance burden of maintaining a patchwork of state-by-state licenses.
The OCC’s increasingly favorable posture toward digital assets
Letter 1192 is the latest in a series of OCC actions reflecting an increasingly favorable regulatory posture toward the digital asset industry. Beginning with Interpretive Letters 1170, 1172, and 1174, the OCC confirmed that national banks may provide crypto custody services, hold stablecoin reserves, participate in distributed ledger networks, and use stablecoins to facilitate payments.16 More recently, the OCC has continued to expand and reaffirm these authorities. In 2025, Interpretive Letter 1183 reaffirmed that crypto custody, stablecoin reserve, and distributed ledger activities remain permissible without prior supervisory nonobjection while Interpretive Letters 1184, 1186, and 1188 clarified that banks may facilitate customer-directed crypto transactions, outsource permissible crypto activities, pay blockchain network fees, hold limited crypto-assets necessary to conduct permissible activities, and engage in certain riskless principal crypto transactions.17 Taken together, these actions demonstrate a consistent regulatory approach that national bank powers are broad enough to encompass emerging digital asset activities, and that federal preemption shields chartered institutions from conflicting state-level requirements.
McDermott Will & Schulte’s FinTech & Blockchain Group can help you navigate the nuances and implications of Letter 1192 and the evolving federal regulatory framework for digital assets. We focus exclusively on matters for the crypto and FinTech industries and would be happy to discuss the implications of these developments for your business and potential paths forward.
Zachary Feinstein, a staff attorney in the New York office, also contributed to this article.
1 See OCC Interpretive Letter 1192, Applicability of State Money Transmitter Licensing Requirements (May 12, 2026).
2 Id. at 1.
3 Id. at 1-2.
4 See Fidelity Digital Assets (last visited June 25, 2026).
5 See OCC Interpretive Letter 1192 at 2; see also OCC, Conditional Approval No. 1355 at 4-5 (Dec. 2025).
6 See Iowa Code §§ 533C.102.9, 533C.103.4.
7 See Barnett Bank v. Nelson, 517 U.S. 25, 32 (1996); see also Cantero v. Bank of Am., N.A., 602 U.S. 205 (2024).
8 See Watters v. Wachovia Bank, N.A., 550 U.S. 1, 21 (2007).
9 See OCC Interpretive Letter 1192 at 3-4.
10 See Cuomo v. Clearing House Ass’n, 557 U.S. 519, 528 (2009); see also First Nat’l Bank v. Hughes, 6 F. 737, 740-41.
11 See OCC Interpretive Letter 1192 at 5.
12 Id.
13 Id.
14 Id. at 4.
15 See, e.g., Conditional Approval No. 1353 (Dec. 2025) (BitGo Trust Company, Inc.); Conditional Approval No. 1355 (Dec. 2025) (Fidelity Digital Asset Services, LLC); Conditional Approval No. 1358 (Dec. 2025) (Paxos Trust Company, LLC); Conditional Approval No. 1356 (Dec. 2025) (First National Digital Currency Bank); and Conditional Approval No. 1359 (Dec. 2025) (Ripple National Trust Bank); OCC Conditional Approval No. 1365 (Bridge National Trust Bank) (Feb. 2026); OCC Conditional Approval No. 1370 (Coinbase National Trust Company) (Apr. 2026); and OCC Conditional Approval No. 1374 (Augustus Bank, N.A.) (May 2026).
16 See OCC Interpretive Letter No. 1170 (Jul. 2020) (authorizing national banks to provide cryptocurrency custody services); OCC Interpretive Letter No. 1172 (Sep. 2020) (confirming authority to hold deposits serving as reserves for certain stablecoins); and OCC Interpretive Letter No. 1174 (Jan. 2021) (confirming authority to participate in independent node verification networks and use stablecoins for payment activities).
17 See OCC Interpretive Letter No. 1183 (Mar. 2025); OCC Interpretive Letter No. 1184 (May 2025); OCC Interpretive Letter No. 1186 (June 2025); and OCC Interpretive Letter No. 1188 (Dec. 2025).