Singapore-based cryptocurrency exchange Crypto.com (CRO) announced on Friday its intention to apply for a national trust bank charter with the US Office of the Comptroller of the Currency (OCC).
This move aligns Crypto.com with other major firms in the industry, including Coinbase (COIN), Ripple Labs, stablecoin issuer Paxos, and Sony Bank, who are also pursuing similar charters in the country.
What A National Trust Bank Charter Means For Crypto.com
According to the exchange’s official statement on the matter, the application aims to enhance Crypto.com’s custody technology and expand its customer offerings, which include asset custody and staking across various blockchains and digital asset protocols, such as Cronos.
A National Trust Bank Charter would establish Crypto.com as a preferred destination for custody services, particularly for Digital Asset Treasuries (DATs), Exchange Traded-Funds (ETFs), and other corporate and institutional investors. Kris Marszalek, Co-Founder and CEO of Crypto.com, stated:
We are excited to take this next step by filing for a National Trust Bank Charter and look forward to continuing to pursue opportunities to provide customers with the trusted services they require.
It’s important to note that a national trust bank charter also allows companies to act as fiduciaries, manage assets, and settle transactions, but it does not permit them to accept deposits or extend loans like traditional banks.
This special-purpose charter is particularly appealing to companies aiming to manage stablecoin reserves or other digital assets under a single federal regulator, the OCC, thereby avoiding the complexities of state-by-state licensing.
A New Era For Crypto Banking
In a related development, Erebor, a firm backed by Peter Thiel, has received partial regulatory approval from the OCC to launch, aimed at addressing the gap left by the collapse of Silicon Valley Bank (SVB).
A source close to Erebor shared with the Financial Times that the bank aims to be a stable and reliable institution, stating, “We want to be a stable, low-risk, reliable bank doing normal banking things without screwing everyone over with undue risk.”
Erebor will be headquartered in Columbus, Ohio, with an additional office in New York, offering digital-only customer service through a smartphone app and website.
Furthermore, Erebor plans to incorporate stablecoins into its operations, aligning with the recent reversal of regulations by the Trump administration that limited banks from engaging in stablecoin transactions.
The source mentioned that the bank’s swift approval reflects its “extremely conservative business plan,” emphasizing that it would not operate as a “wacky, techno crypto bank.”
As the industry navigates this landscape under a pro-crypto administration, it remains to be seen whether applicants, including Crypto.com, will experience the same level of support as Erebor.
However, it is evident that the crypto sector is in need of new banking services following the collapses of Silvergate and Signature Bank.
Featured image from DALL-E, chart from TradingView.com
