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Crypto firms like Circle and BitGo are pursuing bank charters to integrate alongside traditional lenders, leveraging opportunities in stablecoin issuance and loan services.
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The regulatory landscape has shifted, with initiatives such as stablecoin legislation and a rollback of SEC restrictions assisting the legitimacy of crypto businesses.
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Notably, US Bancorp and Bank of America are increasing their crypto offerings, which demonstrates a trend toward mainstream adoption of digital assets.
With easing regulations and renewed bank interest, crypto firms are boldly seeking charters, marking a new era of integration within traditional finance.
Crypto Firms Seek Bank Charters as Wall Street’s Doors Reopen
After years of being sidelined, crypto companies are re-entering the US banking system, this time through the proper channels.
Citing sources familiar with the matter, the Wall Street Journal revealed that several major players, including Circle and BitGo, are preparing to apply for bank charters or financial licenses.
Traditional banks are also responding to the shift. US Bancorp is re-launching its crypto custody program via NYDIG, while Bank of America (BofA) has announced plans to issue its stablecoin once the legal framework is firmly established.
Even global giants are watching closely. A consortium including Deutsche Bank and Standard Chartered is evaluating how to expand crypto operations into the US.
While details remain scarce, the interest signals that crypto is no longer confined to a niche but has become a part of the competitive financial landscape.
These firms aim to operate with the same legitimacy and access as traditional lenders, which includes holding deposits, issuing loans, and launching stablecoins under regulatory supervision.
The timing of this shift is essential. A significant pivot in federal policy, driven by President Trump’s promise to position the US as a Bitcoin superpower, has reopened regulatory pathways previously shut following the FTX collapse.
Simultaneously, Congress is advancing stablecoin legislation that will require issuers to secure federal or state licenses, which could streamline operations for these crypto entities.
The push for bank status comes amid broader efforts to legitimize crypto within US finance. Earlier this year, regulators rolled back significant restrictions, notably the SEC’s controversial SAB 121, which had prohibited banks from holding crypto on behalf of clients.
Moreover, Federal Reserve Chair Jerome Powell confirmed that banks could serve crypto customers if proper risk management strategies are in place.
In another regulatory green light, the Office of the Comptroller of the Currency (OCC) clarified that banks are permitted to offer stablecoin and custody services, as long as they adhere to established banking regulations.
These signals have empowered crypto firms that were once distanced from the mainstream banking system. Anchorage Digital, the only US crypto-native firm with a federal bank charter, suggests the regulatory lift is significant but not without its challenges.
“It hasn’t been easy… the entire scope of regulatory and compliance obligations that banks have can intertwine with the crypto industry,” Anchorage CEO Nathan McCauley reportedly stated.
McCauley cited tens of millions in compliance costs but emphasized that Anchorage has since collaborated with notable companies such as BlackRock, Cantor Fitzgerald, and Copper for custody and lending initiatives.
BitGo, which is purportedly set to custody reserves for a Trump-linked stablecoin, USD1, is also nearing its bank charter application.
Circle, the issuer of USDC, is in pursuit of licenses while facing stiff competition, similar to that from Tether. This marks a traditional finance (TradFi) venture into stablecoins.
The firm decided to postpone its IPO this month due to market volatility and financial uncertainties. Still, insiders assure that regulatory clarity is a priority.
Firms such as Coinbase and Paxos are contemplating similar pathways, eyeing industrial banks or trust charters to legally enhance their financial offerings.
At the policy level, venture firm a16z is advocating for the SEC to modernize rules surrounding crypto custody for investment firms, highlighting the industry’s pressing demand for clarity and equity.
Conclusion
In conclusion, the move by crypto companies to secure bank charters signals a substantial shift in how digital assets are perceived within the financial landscape. With interdisciplinary approaches between traditional banks and crypto firms, the future holds promise for a more integrated financial system. As regulatory frameworks evolve and regulatory bodies adapt, maintaining a balance between innovation and compliance will be paramount in this new chapter for the crypto industry.
