Crypto Law Developments Spark Uncertainty and Challenges
Major developments in the world of cryptocurrency law have emerged in the past week. On October 2, the Independent Community Bankers of America (ICBA) filed a lawsuit against the Office of the Comptroller of the Currency (OCC) in federal court in Washington, D.C. The ICBA challenges the OCC's March 2026 National Bank Chartering rule, which allows national trust banks to operate without accepting deposits or adhering to fiduciary limitations.
The lawsuit seeks to have the challenged actions set aside and to prevent further charter approvals under the rule. This has created uncertainty for crypto custodians and businesses considering a national trust charter, as they must plan for the possibility of litigation affecting their regulatory route.
Another significant development is the Treasury's announcement on October 1 that it has targeted the A7 Network, which it describes as a sanctions-evasion network connected to Russia and used by Iran. The OFAC designation carries blocking consequences under applicable sanctions rules, while FinCEN's proposed transfer prohibition remains a proposal.
Meanwhile, the Senate Permanent Subcommittee on Investigations has released a report criticizing Tether's controls and calling on the Treasury and Justice Department to investigate potential violations. Tether has emphasized its cooperation with authorities and stated that its actions have resulted in approximately $550 million in Iran-linked assets being frozen during 2026.
In Europe, the European Securities and Markets Authority (ESMA) has proposed broader MiCA rules for DeFi access and stronger enforcement. The proposal includes stronger supervisory powers, tighter marketing standards, and clearer treatment of noncompliant stablecoins.
Finally, the UK's Financial Conduct Authority (FCA) has begun accepting applications under the UK's new crypto regulatory regime. The application period runs through February 28, 2027, ahead of the regime's scheduled commencement on October 25, 2027.