Skip to main content

NCUA Opens Door to Crypto for Credit Unions

The NCUA has told credit unions they can use the technology behind cryptocurrency as long as they follow NCUA principles to ensure compliance with existing regulations and don’t create undue risk.

NCUA Chairman Todd Harper’s four-page letter sent Thursday to federally insured credit unions said the NCUA does not prohibit credit unions from employing distributed ledger technology (DLT), which is used to support cryptocurrencies, “if it is deployed for permissible activities and in compliance with all applicable laws and regulations, including applicable state laws or state supervisory authority requirements.”

“As with the development of any new product or service when deploying a platform, product or service using DLT as part of the underlying technology, credit unions should find an appropriate balance between the opportunities and the risks,” Harper wrote.

“This letter also signals to the broader financial and technology communities that credit unions are a market to consider when designing products, considering partnerships or making investments,” he wrote.

Todd Harper Todd Harper (Source: NCUA)

Harper’s letter followed a similar form as one in December, in which he said the NCUA would allow credit unions to hire third-party vendors for cryptocurrency as long as they abided by the same NCUA safety and soundness principles applied in other vendor relationships.

NAFCU had asked for guidance on digital assets in a letter sent to the NCUA last September. Greg Mesack, NAFCU’s SVP of government affairs, thanked the NCUA for “for reducing regulatory uncertainties around digital assets.”

“There is without a doubt a need for additional guidance from regulators on how credit unions can better adopt digital assets and emerging financial technologies,” Mesack said.

“We appreciate that the NCUA heeded our call to adopt a form-agnostic approach to assessing how credit unions use digital assets and related technologies,” he said. “We will continue to articulate the credit union industry’s perspective on this topic and encourage the NCUA to continue building a sound digital assets regulatory framework.”

Ryan Donovan, CUNA’s EVP and chief advocacy officer, also thanked the NCUA for the guidance on distributed ledger technologies, “an issue CUNA has repeatedly asked the agency to address.”

Ryan Donovan Ryan Donovan

“Many questions will likely persist regarding credit unions’ ability to participate in the digital currency space,” Donovan said. “We look forward to more detailed guidance from (the) NCUA on these issues as credit unions continue to explore the benefits of these technologies for their membership.”

The most common distributed ledger technology is Blockchain, which supports Bitcoin and Ethereum. Both cryptocurrencies have traded wildly, especially since the start of 2021. Their values rose three- to four-fold from January to November 2021, then took a roller-coaster plunge that accelerated in April, wiping out all of Bitcoin’s gains since 2021 and nearly all of Ethereum’s by Thursday.

Harper’s letter started with the statement that the NCUA “supports initiatives by federally insured credit unions to better serve their members.”

“The rapid emergence of financial technology is creating opportunities for credit unions to increase the speed of service, improve security, and expand products and services,” Harper wrote. “In this spirit, the board is exploring how the agency can provide clarity around expectations regarding financial technology adoption to not impede safe, fair, and responsible federally insured credit union engagement.”

“As with the internet at its inception, the NCUA recognizes that new technologies may transform how credit unions perform traditional financial operations and services,” Harper wrote. “While DLT is maturing, the NCUA recognizes that cases for implementation may expand rapidly as the technology becomes more widespread and credit unions become more familiar with it.”

The NCUA listed several steps credit unions should take “at a minimum.” They included:

  • The credit union’s board of directors is notified of advancements in the underlying technology, the purposes of the technology, and how using DLT aligns with the credit union’s strategic planning objectives and approved risk tolerances.
  • Credit union staff and third parties using and managing the technology are complying with applicable laws and regulations and acting in a safe and sound manner.
  • Effective risk-management practices are followed to identify, assess and mitigate risks associated with DLT and the specific activities for which it will be deployed.
  • Risk assessment and audit functions can validate and attest to the effectiveness of risk mitigation practices in accordance with internal policy and industry leading practices.
  • Credit unions must identify, assess and mitigate risks associated with DLT.

Jim DuPlessis
CUTimes

Comments

Post a Comment

Please no profanity or political comments.

Popular posts from this blog

5 Red Flags: When Boards Lean Too Heavily on Management

  The Quiet Governance Risk Credit Unions Should Talk About By Grant Sheehan, CCUE | CCUP | CEO, NCOFCU Having spent many years both serving on a credit union board and leading as a CEO , I’ve had the opportunity to see governance from both sides of the table. That perspective has given me a deep appreciation for the delicate balance that must exist between management, leadership, and board oversight. When that balance works well, credit unions thrive. But when it slowly shifts — often unintentionally — it can create governance weaknesses that regulators and examiners increasingly watch for. In conversations with governance professionals and through years of industry experience, one theme keeps emerging: most governance problems don’t begin with bad intentions or misconduct. They begin with boards that gradually become too dependent on management. This is rarely obvious at first, but in fact, it often occurs within high-performing organizations. But slight patterns ca...
Post a Comment
Read Complete Article HERE>»

We Don't Need More Trade Groups!

This is a op-ed reference: New National Trade Group Forms To Champion Credit Unions Under $500M Grant Sheehan, CEO, NCOFCU Let’s be clear—representation for small credit unions is not something new that suddenly needs to be invented. For more than 150 years in Europe and 115 years in the US, many of us—along with numerous trade groups representing postal workers, schools, hospitals, the military, first responders, electricians, welders, auto workers, and many other sponsor employee groups—have been actively representing and supporting small credit unions. The mission has always been the same: protect these institutions and ensure they have a voice. The real challenge facing small credit unions has never been a lack of organizations claiming to represent them. The challenge has been engagement and education. Many small credit unions operate with extremely limited resources. Their boards are made up of volunteers who already have full-time careers. Even when scholarships, training ...
Post a Comment
Read Complete Article HERE>»

From Share Drafts to Stablecoin: Progress Is the Product

  From Share Drafts to Stablecoin: Progress Is the Product By  Jeff Rendel Expert Opinion March 09, 2026 at 08:00 AM Share & Print There was a time when the phrase "share draft" felt modern. It was progressive. It was distinct. It was proudly credit union. We didn't offer checking accounts; we offered share drafts because members owned shares in a cooperative, not deposits in a bank. It was an important distinction. It meant something philosophically and structurally. And when share drafts were introduced, they were new. Innovative. Even controversial. Somewhere along the way, however, share drafts became nostalgic. The language remained, but the behavior changed. Today, many members under 30 have never written a check. Many under 40 rarely do. Payments have migrated – steadily, predictably – from paper to plastic, from plastic to digital, from digital to embedded and real-time. This is not disruption in the dramatic sense. It is evolution. And credit unions have alwa...
Post a Comment
Read Complete Article HERE>»

Meet Spokane Firefighter Credit Union (SFCU) New President/CEO - Troy Clute

Meet SFCU's New President/CEO - Troy Clute  Troy Clute serves as the President and Chief Executive Officer of Spokane Firefighters Credit Union, bringing 29 years of experience in banking and finance. His career includes extensive leadership roles across the industry, with a strong foundation in consumer lending and member-focused financial services. Troy is a graduate of the renowned CUES CEO Institute Program, having earned the Certified Chief Executive (CCE) designation—one of the highest leadership credentials in the credit union movement. His leadership is defined by strategic vision, operational excellence, and a deep commitment to serving Spokane’s firefighter community and their families. Beyond his professional role, Troy values family above all. He and his wife, Karri, have been married for 36 years and share two grown children, Kellen and Kennadie, as well as three grandchildren—Tyus, Izze, and Major—who keep life joyful and full of adventure. When he’s not leading the c...
Post a Comment
Read Complete Article HERE>»

Outside Credit Unions - 54th Iditarod Trail Sled Dog Race

  Dog Sled Race Begins   The 54th Iditarod Trail Sled Dog Race kicked off yesterday, with hundreds of dogs amassing at the ceremonial start in downtown Anchorage, Alaska, before moving north to the official starting line. Thirty-four mushers will compete, with the race expected to end in mid-March. The race dates back to 1973, with cofounders Dorothy Page and Joe Redington Sr. seeking to honor the state’s mushing tradition. The race also honors Alaska’s Iditarod Trail—a 938-mile freight and mail route forged in 1908 that was later instrumental in responding to a diphtheria outbreak ( see more , w/video). Though the first race (1,000 miles) lasted 20 days, dogs today have become faster, reaching the finish line in Nome in roughly 10 days. There are 12-16 dogs per sled to start, as some dogs exit due to injury; mushers must finish with at least five. Norwegian billionaire Kjell Rokke will join the fray in this year’s ra...
Post a Comment
Read Complete Article HERE>»

Where are your children banking?

  Grant Sheehan CCUE | CCUP | CEO, NCOFCU The B reach  Between Purpose and Experience Just recently, I came across a story that has stayed with me. It wasn’t dramatic in the traditional sense. There was no scandal, no crisis, no headline-grabbing failure. In fact, it was something much quieter than that. It was simply the story of an eighteen-year-old leaving his credit union. On the surface, that might not sound remarkable. Young people move their money frequently. They open new accounts, experiment with apps, follow trends, and often make financial decisions influenced by the digital tools at their disposal. But this story was different. This young man had been a credit union member since he was a few weeks old, as many credit unions do. His mother has spent her career working inside the credit union movement as an executive. For eighteen years, his financial life was connected to a credit union. If anyone might be expected to remain a lifelong member, it wou...
Post a Comment
Read Complete Article HERE>»

Stablecoins Moving from Crypto Curiosity to Payments Infrastructure

At the 2026 Governmental Affairs Conference (GAC), credit union leaders heard a clear message: stablecoins are rapidly evolving from a niche crypto tool into a core component of modern payments infrastructure. Stablecoins are digital tokens typically pegged to a fiat currency like the U.S. dollar and backed by reserves such as cash or short-term Treasury securities. Initially used mostly inside cryptocurrency markets, they are now increasingly being viewed as a faster and more efficient way to move money globally . Why Stablecoins Matter The technology offers several potential advantages over traditional payment systems: 24/7 settlement instead of banking-hour restrictions Faster cross-border payments with fewer intermediaries Lower transaction costs compared with legacy payment rails Greater transparency and programmability in how funds move These capabilities are why banks, fintechs, and large financial institutions are beginning to explore stablecoins as part o...
Post a Comment
Read Complete Article HERE>»

Letter to Federal Credit Unions (25-FCU-02) Federal Credit Union Post-Examination Survey

    Letter to Federal Credit Unions (25-FCU-02) Federal Credit Union Post-Examination Survey Dear Boards of Directors and Chief Executive Officers: The NCUA has been using a voluntary post-examination survey for examinations of federal credit unions since 2021. This feedback is very important and helps the NCUA evaluate our examination processes; credit unions have used the open-ended questions to submit numerous useful suggestions. To further improve the survey process, the NCUA has arranged to have the post-examination survey administered by an external vendor. The external vendor will begin administering the survey starti...
Post a Comment
Read Complete Article HERE>»

The NCUA just published its stablecoin playbook: Here’s what credit unions need to know

The National Credit Union Administration (NCUA) has begun answering a key question for credit unions since the GENIUS Act became law last July: What is the stablecoin licensing process? On February 11, 2026, the NCUA published a  22-page proposed rule , "Investments in and Licensing of Permitted Payment Stablecoins Issuers," in the Federal Register. This document outlines the framework for credit union participation under the new Act. The NCUA has a deadline of July 18, 2026, to finalize this rule. Here’s what credit unions need to know now. Quick background: The GENIUS Act and the NCUA’s role The GENIUS Act designated the NCUA as a primary federal regulator of stablecoin, alongside the FDIC, the OCC, and the Federal Reserve. Credit unions can't issue stablecoins directly; they must operate through subsidiaries, typically CUSOs, that apply for and obtain an NCUA-issued Permitted Payment Stablecoin Issuer (PPSI) license. The newly proposed rule covers the application and l...
Post a Comment
Read Complete Article HERE>»