Several banking and credit union groups have asked US regulators to hold off on granting federal bank licences to crypto companies.
In a letter sent on July 17, the American Bankers Association and other trade groups urged the Office of the Comptroller of the Currency (OCC) to delay any decisions until more details about the applicants’ plans are made public.
The groups said the applications from firms like Circle, Ripple, and Fidelity Digital Assets raise legal and policy questions.
Did you know?
Subscribe – We publish new crypto explainer videos every week!
What is Ethereum 2.0? Upgrades Easily Explained With Animations
If approved, the licences would let these crypto companies operate as national banks, handle payments more quickly, and avoid having to get separate approvals in each state.
The groups, however, said the available information in the applications does not allow for proper review or public feedback. They also noted that the OCC itself should face more scrutiny if it decides to move ahead.
The letter stated that offering custody of digital assets is not a fiduciary activity, and granting charters where such services are not central would change OCC policy.
Caitlin Long, founder of Custodia Bank, stated in a July 19 post on X that the debate over whether trust charters are being used as a kind of bank licence with lighter requirements is likely to end up in court.
She added that if crypto companies succeed, traditional banks might switch to trust charters to lower their own costs and reduce their regulatory burden.
On July 14, three US federal agencies released a joint document warning banks about the risks of holding cryptocurrency for their customers. What did they say? Read the full story.
Having completed a Master’s degree in Economics, Politics, and Cultures of the East Asia region, Aaron has written scientific papers analyzing the differences between Western and Collective forms of capitalism in the post-World War II era.
With close to a decade of experience in the FinTech industry, Aaron understands all of the biggest issues and struggles that crypto enthusiasts face. He’s a passionate analyst who is concerned with data-driven and fact-based content, as well as that which speaks to both Web3 natives and industry newcomers.
Aaron is the go-to person for everything and anything related to digital currencies. With a huge passion for blockchain & Web3 education, Aaron strives to transform the space as we know it, and make it more approachable to complete beginners.
Aaron has been quoted by multiple established outlets, and is a published author himself. Even during his free time, he enjoys researching the market trends, and looking for the next supernova.
