American Bankers Association Has Urged U.S. OCC To Delay Approving National Trust Bank Charters For Crypto Firms

American banking groups, led by the American Bankers Association and other professional associations, have urged the office of the Currency controller (OCC) To delay the approval of the National Trust Bank charters for cryptocurrency companies such as Circle, Ripple Labs and Fidelity Digital Active. They argue that the applications of these companies lack transparency and sufficient details for a public examination, increasing “problems of important policy and processes”.

Banks claim that the granting of these licenses would be a “fundamental departure” of traditional trustee activities of trust banks, potentially allowing cryptographic companies to offer services such as payments with less regulation and lower capital requirements, which could destabilize the financial system. They also express concerns about volatility, inadequate investor protections and compliance with anti-whiteness standards (AML) and connoisseur standards (KYC).

Defenders of cryptography, including companies like Circle and PaxosCounter that blockchain -based systems offer technological advantages such as real -time audit and secure registers holding, and the search for licenses reflects a commitment to regulations, not on escape. They argue that national charters would allow wider operations without state license by state, as encouraged by GeniusThis limits the activities of stable issuers. Votes of industry, as Long Caitlin From Gustodia Bank, suggests that this debate can lead to disputes, because traditional banks fear competition from cryptographic companies operating under lighter trust charter rules.

Meanwhile, recent changes in regulation, such as West March 2025 The directives allowing banks to engage in cryptographic activities without prior approval, indicate a more permissive environment, although banks remain cautious due to regulatory concerns and persistent risk. Lobbying by American banks against cryptographic companies acquiring banking licenses has significant implications for the financial sector, regulations and innovation.

The blocking of cryptographic companies to obtain charters of the National Trust Bank could limit their ability to compete with traditional banks, slowing down the adoption of blockchain -based technologies such as real -time audit and the care of secure digital assets. This can delay innovation in financial services, such as faster and cheaper payment systems or decentralized financial solutions (DEFI).

If cryptographic companies are denied national charters, they may need to navigate in state licenses by state, increasing the costs of compliance and complexity. This could discourage small cryptographic companies from scaling, promote the greatest players and potentially concentrate market power. Banks argue that cryptographic companies under the lighter trust charter regulation could present risks due to volatility and lower AML / KYC compliance.

If licenses are granted without strict supervision, this could lead to systemic vulnerabilities. Conversely, surregulation could push cryptographic activities to less regulated offshore jurisdictions, increasing global financial risks. The restriction of access to cryptographic companies to charters can limit consumer access to regulated cryptography services, pushing users to unregulated platforms with fewer protections. However, if charters are granted, robust surveillance will be crucial to guarantee the guarantees of investors in the midst of the volatility of cryptography.

The debate could trigger disputes, as we see with cases like Guardianpotentially clarifying the legal framework of the cryptographic bank but also an uncertainty prolonging. He can also put pressure on legislators to refine legislation such as the Act on Engineering, balancing innovation with regulatory rigor. Traditional banks fear losing market share against cryptographic companies offering competitive services with lower capital requirements.

If cryptographic companies gain charters, banks can accelerate their own crypto offers, as allows recent West Guidance, intensification of competition but also the integration of crypto into traditional finance. The refusal of the charters could push cryptographic innovation to jurisdictions with more favorable regulations, weakening the position of the United States as a leader in financial technology. Conversely, a balanced approach could position the United States as a center for regulated cryptographic innovation.