Wintermute OTC Head: Banks' participation in crypto trading is essentially a brokerage model; they cannot hold positions or conduct proprietary trading.

In response to the explanatory letter from the U.S. Office of the Comptroller of the Currency (OCC) clarifying that national banks' participation in risk-free principal-to-principal (PTP) transactions of crypto assets is legitimate banking business and that they can act as intermediaries in cryptocurrency trading, Jake, head of Wintermute OTC, stated on social media that the process of banks participating in crypto trading is fundamentally different from proprietary trading. He pointed out that in transactions, banks typically purchase crypto assets from clients and immediately transfer the position to liquidity providers (LPs). Technically, they only acquire ownership of the crypto assets for a very short period to complete the transaction matching, but they do not actually hold inventory or bear the risk of price fluctuations. From an economic perspective, this model falls under brokerage business; banks can match buyers and sellers, but cannot hold positions or conduct proprietary trading.