This page is for information purposes only. Certain services and features may not be available in your jurisdiction.

US Banking Groups Push Back Against Crypto Firms Seeking National Bank Charters

Introduction: The Growing Debate Over Crypto Firms and National Bank Charters

The intersection of cryptocurrency and traditional banking has become a focal point of regulatory and financial debate in the United States. Banking and credit union groups have recently urged the Office of the Comptroller of the Currency (OCC) to delay granting national bank charters to crypto firms. This push reflects growing concerns over regulatory gaps, policy risks, and the potential destabilization of the financial system. As major crypto firms like Circle Internet Group, Ripple Labs, and Fidelity Digital Assets seek national trust bank charters, the debate underscores the tension between fostering innovation and ensuring robust regulatory oversight.

What Is the OCC’s Role in Crypto Banking Licenses?

The OCC is a key federal agency responsible for regulating and supervising national banks in the United States. By granting national bank charters, the OCC allows financial institutions to operate under federal jurisdiction, bypassing the need for state-level licenses. For crypto firms, obtaining a national bank charter offers legitimacy and the ability to expand operations across the country. However, this shift has sparked questions about whether entities with fundamentally different business models from traditional banks should be granted such privileges.

Why Are Banking Groups Opposed to Crypto Bank Charters?

Traditional banking organizations have expressed strong opposition to crypto firms receiving national bank charters. Their concerns include:

  • Lack of Fiduciary Activities: Crypto firms often do not engage in traditional banking activities like deposit-taking, lending, or asset custody.

  • Transparency Issues: Banking groups have called for greater transparency in the charter application process, including public disclosures and detailed scrutiny.

  • Regulatory Risks: Critics argue that crypto firms operating as banks could undermine longstanding OCC policies and introduce risks to the financial system.

These concerns highlight the broader challenges of integrating crypto firms into the traditional banking framework.

Traditional Fiduciary Activities vs. Crypto Business Models

A key point of contention is the difference between traditional fiduciary responsibilities and the business models of crypto firms. Traditional banks engage in activities like:

  • Asset custody

  • Lending

  • Deposit-taking

In contrast, many crypto firms focus on:

  • Blockchain technology

  • Stablecoin issuance

  • Decentralized finance (DeFi) services

Critics argue that these activities do not align with the fiduciary standards expected of national banks, raising doubts about whether crypto firms can meet the responsibilities associated with a national charter.

How Stablecoin Laws Influence Crypto Banking Licenses

Stablecoin legislation, such as the GENIUS Act, has added complexity to the debate. These laws incentivize stablecoin issuers to apply for national trust bank charters, enabling them to:

  • Expand operations beyond stablecoin issuance

  • Avoid state-by-state licensing requirements

While this could streamline operations for crypto firms, it also raises concerns about regulatory loopholes and the broader implications for the financial system. Legal experts predict that stablecoin laws will play a pivotal role in shaping the future of banking licenses for crypto firms.

Federal vs. State-Level Regulation: A Key Debate

Crypto firms are increasingly seeking national bank charters to operate under a unified federal framework, avoiding the complexities of state-level regulations. While federal oversight offers consistency, it also introduces challenges, such as:

  • Ensuring adequate regulatory scrutiny

  • Addressing the unique risks posed by crypto business models

This federal-versus-state dynamic is a critical aspect of the debate, as stakeholders weigh the benefits of streamlined regulation against potential risks to the financial system.

Risks to the US Financial System From Crypto Firms as Banks

Granting national trust bank charters to crypto firms represents a significant departure from traditional OCC policy. Critics warn that this shift could:

  • Destabilize the financial system by introducing entities with unconventional business models

  • Create competitive pressures on traditional banks, forcing them to adapt or risk losing market share

These risks underscore the broader implications of integrating crypto firms into the banking sector and highlight the need for careful regulatory oversight.

Legal Challenges Over Trust Charters

Legal experts anticipate litigation over whether trust charters can serve as de facto bank charters with reduced regulatory burdens. The debate centers on:

  • The definition of trust charters

  • Whether they provide crypto firms with an unfair competitive advantage

This legal uncertainty adds another layer of complexity to the issue, as stakeholders grapple with redefining regulatory frameworks to accommodate emerging financial technologies.

Competition Between Traditional Banks and Crypto Firms

The growing competition between traditional banks and crypto firms has created an unusual alliance between banks and credit unions, united in their opposition to crypto firms entering the banking sector. Key concerns include:

  • Disruption of traditional banking models

  • Pressure on banks to convert to trust companies to avoid stricter regulations

While competition can drive innovation, it also raises questions about the long-term stability of the financial system and the role of regulatory oversight in maintaining balance.

Conclusion: The Future of Banking and Crypto Integration

The debate over granting national bank charters to crypto firms is far from resolved. As the OCC evaluates applications from crypto entities, it must balance the need for innovation with the imperative to safeguard the financial system. Concerns about policy risks, fiduciary activities, and regulatory gaps highlight the challenges of integrating crypto firms into the banking sector. The outcome of this debate will shape the future of financial services in the United States, influencing how traditional banks and crypto firms coexist in an evolving financial landscape.

Disclaimer
This article may cover content on products that are not available in your region. It is provided for general informational purposes only, no responsibility or liability is accepted for any errors of fact or omission expressed herein. It represents the personal views of the author(s) and it does not represent the views of OKX TR. It is not intended to provide advice of any kind, including but not limited to: (i) investment advice or an investment recommendation; (ii) an offer or solicitation to buy, sell, or hold digital assets, or (iii) financial, accounting, legal, or tax advice. Digital asset holdings, including stable-coins, involve a high degree of risk, can fluctuate greatly, and can even become worthless. You should carefully consider whether trading or holding digital assets is suitable for you in light of your financial condition. Please consult your legal/tax/investment professional for questions about your specific circumstances.

© 2025 OKX TR. This article may be reproduced or distributed in its entirety, or excerpts of 100 words or less of this article may be used, provided such use is non-commercial. Any reproduction or distribution of the entire article must also prominently state:"This article is © 2025 OKX TR and is used with permission." Permitted excerpts must cite to the name of the article and include attribution, for example "Article Name, [author name if applicable], © 2025 OKX TR." Some content may be generated or assisted by artificial intelligence (AI) tools. No derivative works or other uses of this article are permitted.

Related articles

View more
trends_flux2
Altcoin
Trending token

Talus Network: Redefining Decentralized AI in Web3

Introduction: What is Talus Network? The Talus Network is a groundbreaking Layer 1 blockchain platform designed to integrate artificial intelligence (AI) seamlessly into the Web3 ecosystem. By leveraging decentralization, Talus aims to address the limitations of centralized AI systems, offering a secure, scalable, and developer-friendly environment for creating autonomous AI agents. Established in 2023, Talus has quickly gained traction, raising $9 million in funding and attracting attention from major investors and industry leaders.
Jul 23, 2025
trends_flux2
Altcoin
Trending token

Bless Network: Revolutionizing Computing with Decentralized Edge Solutions

Introduction: Bless Network's Decentralized Vision In a world increasingly dominated by centralized technology giants, Bless Network emerges as a transformative force, turning everyday devices into a global shared computer. This decentralized physical infrastructure network (DePIN) leverages idle computing resources from personal devices, such as laptops and smartphones, to power decentralized applications (dApps) and services. By doing so, Bless Network aims to create a more equitable internet ecosystem, reducing reliance on centralized entities and giving users greater control and ownership.
Jul 23, 2025
trends_flux2
Altcoin
Trending token

Teneo Protocol: Bridging Real-World Data with Blockchain for AI Innovation

Understanding Teneo Protocol: A New Era for Data Monetization In the rapidly evolving landscape of data utilization, Teneo Protocol emerges as a groundbreaking platform that redefines how real-world data is accessed and monetized. As the demand for high-quality data surges, particularly for AI technology, Teneo Protocol positions itself as a crucial bridge between Web2 and Web3 technologies. This innovative platform empowers users to not only control their data but also profit from it, marking a significant shift in data ownership and monetization.
Jul 23, 2025