Coinbase Receives OCC Conditional Banking Charter Approval

Coinbase receives a conditional OCC approval.

Coinbase has announced that it has received an update regarding its national bank trust charter license, with the OCC (Office of the Comptroller of the Currency) informing it of a conditional approval. This allows the Coinbase National Trust Company to be federally regulated in the U.S. and go beyond state-level restrictions.

Co-CEO of Coinbase Institutional Greg Tusar wrote:

This charter is about bringing federal regulatory uniformity to the custody and market infrastructure business we have been building for years. The OCC charter was designed precisely for this purpose — to provide clear oversight over assets in safekeeping — and that is exactly how we intend to use it.

More broadly, the company will have a clear arena to conduct its digital asset activities, including stablecoin and crypto custody, stablecoin settlement, trading and brokering of listed crypto assets, among others. However, this type of license differs from the typical banking activities that regional and large commercial banks undertake, such as taking in deposits with FDIC insurance and lending those deposits back out to individuals and communities.

Earlier in March, the OCC had published a document outlining its recent amendments to the National Bank Act to make the scope of newly chartered banks (previously called "special purpose") as those of "the operations of a trust company and activities related thereto". This was recently changed from "fiduciary activities" as to remove wider misunderstanding from banks that provide traditional deposit and lending services, from those that do not.

The final approval still to come means Coinbase will have a direct and improved relationship with key departments of the U.S. financial landscape, with OCC, Treasury and Federal Reserve all set to be involved in some capacity. Time will tell if the likes of Coinbase and others, such as BitGo, Ripple, Paxos, Fidelity who have applied for banking charters will gradually merge their services into a one-stop shop for digital asset banking, wealth and asset management.