WASHINGTON — The Trump administration last week approved plans to launch five new cryptocurrency-focused national banks, a move aimed at expanding the industry’s access to the traditional financial system, according to a new report.
Circle and Ripple were among the crypto companies that received conditional approval on applications filed with the Office of the Comptroller of the Currency, the Wall Street Journal reported.
“The approvals come as a growing number of nonbank firms seek entry into the banking system amid President Donald Trump’s favorable stance toward the cryptocurrency industry and broader push to reduce regulation,” the report stated. “Crypto companies and financial technology firms have applied for specialized bank charters, while large retailers such as Amazon and Walmart have explored expanding bank-like services since Trump returned to office.”
Moving Toward National Trust Banks
The OCC’s conditional approvals will allow Circle and Ripple to move forward with establishing national trust banks. As the Journal noted, such institutions have traditionally been used by insurance companies, asset managers and payroll processors and typically do not accept deposits or make loans.
The OCC said applicants will have up to 18 months to raise capital and build the infrastructure needed to open, and they will be subject to a final regulatory examination before launching operations.
Bypassing Intermediaries
Circle, Ripple and other applicants say obtaining national trust charters would allow them to bypass intermediaries and increase consumer confidence in services such as digital asset custody and the issuance of stablecoins — cryptocurrencies designed to maintain a fixed value, the Journal explained.
The report added that traditional banks have expressed concern about the growth of stablecoins, which could compete with existing payment and deposit services if widely adopted.
So far this year, 12 companies have applied for trust charters, the highest number in at least eight years, according to data compiled by financial-services advisory firm Klaros Group, the Journal said.
Conversions Approved
Paxos, BitGo and Fidelity also received approval last week, with the OCC allowing those firms to convert existing state trust charters into national trust charters.
Banking trade groups had opposed the applications, arguing they could pose risks to financial stability. The Banking Policy Institute said the approvals leave “substantial unanswered questions,” including whether the regulatory requirements are appropriately aligned with the risks posed by the new trust banks.
