Coinbase Seeks Federal Charter to Boost Crypto Payments & Trust
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Coinbase has applied for a national trust charter with the Office of the Comptroller of the Currency (OCC), a strategic move to significantly expand its payment operations and fiduciary services. This federal charter, unlike a full-service commercial bank license, permits institutions to operate as national trust banks, primarily focusing on non-depository activities like fiduciary, trust, custody, and asset management services. For crypto firms, it's particularly appealing for scaling digital asset custody and stablecoin reserve management across the U.S.
Coinbase explicitly states it does not intend to become a traditional bank. Instead, the company, through its VP of Institutional Product, Greg Tusar, highlights that the charter's primary benefit is the regulatory clarity and fiduciary status it provides. This clarity is crucial for fostering innovation and launching new products beyond existing custody offerings, specifically targeting payments and related services. The move is expected to streamline oversight for new crypto offerings, facilitating the integration of digital assets into traditional finance and encouraging broader institutional adoption.
While specific technical specifications of new products aren't detailed, the charter is the enabling technology for a robust expansion of Coinbase's service portfolio. It allows for the secure and regulated management of digital assets, including stablecoin reserves, and supports the development of payment solutions. Coinbase's recent partnership with Shopify to integrate USDC payments exemplifies its push into the payment markets, and the OCC charter is poised to accelerate such initiatives by providing a clear regulatory framework. This strategic step aligns Coinbase with other crypto entities like Ripple Labs and Paxos, which have also sought similar federal charters, underscoring a broader industry trend towards regulatory compliance to underpin growth and innovation.
(Source: https://bitcoinist.com/coinbase-national-trust-charter-to-bolster-payments/)
