Cryptocurrency prices soared on Monday night after the U.S. Currency Controlling Office (OCC) issued a letter approving U.S. banks to use public blockchain networks.
Ether jumped almost 12% at letter launch, given Ethereum’s dominance as a stable payment settlement protocol. Bitcoin also gained 5% and the two main cryptocurrencies almost completely recovered Sunday night’s losses.
“After a flurry of negative regulatory news, investors are satisfied with positive regulatory news allowing the integration of stablecoin and public blockchain into the traditional banking sector,” said Justin Yashouafar, managing partner at Blockhead Capital, based in Santa Monica .
The letter was addressed to national banks and federal savings associations that participate like us in a blockchain and store or validate payments made on native digital assets or stablecoins.
The OCC letter contrasts with a bill introduced in the last session of Congress that would require issuers of stablecoin to obtain bank licenses. This aggressively anti-stablecoin proposal resulted in hundreds of thousands of dollars in donations sent to the main cryptocurrency defense group Coin Center.
In mid-December, the Treasury Department proposed improved rules on getting to know your client (KYC) for cryptocurrency users in the United States who want to transfer their assets from a purse to their personal wallets.
Yashouafar noted that positive reactions from bitcoin and ether on Monday were followed by price spikes in native tokens for other stablecoin support networks, such as Algorand and Solana, both of which support the two biggest stablecoins: tether (USDT) and USDC stablecoin from Circle.
However, although the ether and algorithm prices “reacted immediately to the news”, Yashouafar pointed out that Solana’s did not.
Bitcoin gained almost 13% already in 2021 on the last check, trading hands over $ 32,500. Ether is trading just under $ 1,100, about 25% below its record $ 1,448.