Paxos Applies For National Bank Charter Following GENIUS Bill

Paxos is planning to pursue a national trust bank charter from the Office of the Comptroller of the Currency (OCC), transitioning from its current New York trust charter, according to the company's newsroom page. This comes after industry competitors, Ripple and Circle, have each applied to manage their own stablecoin reserves after the GENIUS Act passed.

Paxos initially applied for a national trust bank charter in December 2020, receiving conditional approval in April 2021. However, the approval lapsed in March 2023 due to unmet pre-opening requirements. The renewed application comes at a crucial time, coinciding with a shift in US regulatory frameworks for stablecoins and digital assets.

Speaking on the announcement, CEO Charles Cascarilla stated:

“By applying for a national trust bank charter, we are continuing to offer enterprise partners and consumers the safest, most trusted infrastructure available. This is rooted in our belief in the transformative power of blockchain as a force for financial freedom. OCC oversight will help build on our historic commitment to maintaining the highest standards of safety and transparency.”

By obtaining this charter, Paxos would be able to manage customer assets under federal oversight, significantly broadening its operational scope while maintaining its focus on providing a secure infrastructure. If approved, it will join the likes of traditional banks and ability to offer less restricted institutional services to their growing client base.