Crypto faces pushback amid OCC trust-charter review

Banks ask OCC to slow crypto trust charters: reasons

U.S. banks and trade groups are pressing the Office of the Comptroller of the Currency to slow or pause approvals of crypto-linked national trust charters while broader rules are under review. As reported by ABA Banking Journal, an industry coalition in mid-2025 urged a postponement, arguing public application materials lack detail and questioning whether proposed activities satisfy fiduciary definitions required for trust banks.

Objections are not limited to process. As reported by CoinDesk, the Independent Community Bankers of America urged the regulator to reject Coinbase’s trust charter bid, citing control weaknesses and statutory concerns. Critics warn that moving too quickly could invite regulatory arbitrage in digital assets, blur the boundaries of what constitutes a bank, and heighten consumer-protection and resolution risks without commensurate oversight.

What the OCC national trust charter allows and excludes

A national trust charter is a limited-purpose bank charter focused on fiduciary and trust activities such as custody and safekeeping. Unlike a full-service bank charter, it does not authorize deposit-taking and therefore does not carry FDIC insurance. In digital-asset contexts, the framework is generally used to hold assets in custody, keep client property segregated, and perform fiduciary services subject to bank supervision.

Activities outside the fiduciary scope, such as traditional lending or other commercial banking lines, are excluded unless separately approved under applicable laws. The distinction matters: firms that wish to engage in broader banking operations would need to seek a full-service charter rather than rely on a trust charter’s narrower authorities.

Immediate implications for custody, stablecoins, and oversight

For custody, nearer-term effects would likely center on institutional safekeeping, wallet-key management, and control frameworks that address segregation, reconciliations, and third-party risk. Clarity over charter scope could help align crypto custody with bank-style governance, testing, and examinations, while leaving trading and other market-facing activities to separately regulated entities.

On stablecoins, a limited-purpose trust could be used to hold reserves and administer issuance when the business model remains narrowly fiduciary. Debate has centered on how demand for stablecoins, and the composition of assets held in reserve, might interact with bank funding and payment flows over time. State–federal coordination also remains a live issue: as reported by American Banker, the Conference of State Bank Supervisors has warned that some activities, if they stray into deposit-taking, lending, or payments, could exceed national trust authorities and collide with state banking or money-transmission laws.

At the time of this writing, market context remains mixed: based on data from NasdaqGS (delayed quotes), Coinbase (COIN) most recently closed near $165 on Feb. 6. This reference is provided for background only and does not reflect any view on valuation or risk.

OCC response, review criteria, and oversight conditions

The agency has signaled that de novo national trust charter applications from digital-asset firms will be considered where the business is truly fiduciary in nature and backed by strong controls. According to the Office of the Comptroller of the Currency, reviews focus on governance, capitalization, risk management, BSA/AML and sanctions compliance, operational resilience, consumer compliance, and credible plans for recovery and resolution consistent with a limited-purpose institution.

“Companies should not receive trust charters unless they plan to operate as genuine trust companies. If they want to engage in traditional banking activities, they should seek full-service banking charters,” said Paige Pidano Paridon, Executive Vice President at the Bank Policy Institute. Her remarks reflect a broader push for uniform standards and clear lines between fiduciary charters and commercial banking permissions.

In practice, the OCC indicates that approvals are case-by-case and conditioned on strict supervisory agreements, with the possibility of additional limits where business models present novel risks. Industry letters have pressed for greater transparency around applications and public comment opportunities. The resulting framework will likely balance innovation in custody and settlement against statutory boundaries, consumer safeguards, and coordination with state supervisors.