In a significant development for the cryptocurrency industry, five digital asset firms have secured conditional approvals from the Office of the Comptroller of Currency (OCC) to become federally chartered trust banks. This decision marks a pivotal moment for U.S. dollar stablecoin issuers, bringing them under federal regulatory oversight. Among the firms receiving approval are Ripple, known for its cutting-edge blockchain technology, and Circle’s First National Digital Currency Bank. Other notable companies include BitGo, Fidelity Digital Assets, and Paxos, all of which previously operated under state charters.
The OCC, the sole federal agency responsible for chartering banks and trusts, has shifted its stance on cryptocurrency under the current administration. Jonathan Gould, the agency’s head, emphasized the OCC’s commitment to adapting to the evolving landscape of financial services. “The OCC will continue to provide a path for both traditional and innovative approaches to ensure the banking system keeps pace with financial evolution,” he stated.
If these newly approved trust banks meet the OCC’s standards, they will join approximately 60 other regulated institutions, permitting them to conduct fiduciary activities, including custody services. However, it’s noteworthy that national trust banks, like the recently chartered Anchorage Digital, have specific limitations on their business activities, which do not include typical deposit and lending functionalities.
Brad Garlinghouse, CEO of Ripple, heralded the OCC’s decision as “huge news” for the firm and its $1.3 billion RLUSD stablecoin. He criticized banking lobbyists for their anti-competitive tactics, questioning their opposition to the crypto industry, which is now operating under the OCC’s regulatory umbrella. “What are you so afraid of?” he asked, positioning the crypto sector as committed to compliance and innovation.
Circle also expressed optimism following the OCC’s approval. The company stated that the national trust bank charter would bolster the safety and regulatory oversight of its $78 billion stablecoin, USDC, while allowing for fiduciary digital asset custody services aimed at institutional clients.
Paxos, responsible for managing the $3.8 billion PYUSD stablecoin, noted that its federally regulated platform would facilitate businesses in issuing, custodying, trading, and settling digital assets with enhanced confidence. With a history of operating under a New York Department of Financial Services charter since 2015, Paxos first sought a federal charter in 2020.
BitGo’s CEO, Mike Belshe, remarked that this approval signals the conclusion of the crypto industry’s long struggle against unfavorable banking practices and heralds an era of regulatory integration and banking innovation. BitGo is recognized as the issuer of USD1, a digital dollar token with connections to the Trump family through World Liberty Financial, which highlights the intertwining of politics and cryptocurrency.
The crypto industry has encountered numerous challenges in accessing banking services in the U.S., facing a protracted struggle against regulators and traditional financial institutions accused of systematically cutting banking ties with crypto entities. The Trump administration’s recent policies have aimed to counter previous restrictions faced by crypto firms. In a related matter, the OCC released a report indicating that all nine of the largest banks have partaken in the debanking of legal business customers, with potential repercussions for those involved.
This surge in approvals for cryptocurrency firms marks a transformative moment for the sector as it moves toward increased legitimacy and oversight within the U.S. banking system.
