Coinbase Hits Resistance in Bid for Trust Bank Status
Hey Digital Banking Fanatic!
Coinbase’s push for a U.S. federal trust charter has triggered resistance from traditional banking groups, spotlighting the growing tension between crypto firms and regulated finance.
The Independent Community Bankers of America (ICBA) formally urged the Office of the Comptroller of the Currency (OCC) to reject Coinbase’s application, arguing that the exchange doesn’t meet the statutory standards to be considered a trust bank.
The Bank Policy Institute (BPI) joined the chorus, warning that approving such charters for crypto players could bring “compounding safety and soundness risks.”
Coinbase fired back. Paul Grewal, its Chief Legal Officer, wrote on X:
“Imagine opposing a regulated trust charter because you prefer crypto to stay … unregulated. That’s ICBA’s position. It’s another case of bank lobbyists trying to dig regulatory moats to protect their own. From undoing a law to go after rewards to blocking charters, protectionism isn’t consumer protection.”
The debate cuts to the core of how traditional and digital finance will (or won’t) coexist. As charter applications gain attention, so does the pressure to define the future of financial infrastructure.
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NEWS
🇺🇸 Coinbase faces flak from traditional bankers on its push for a trust bank charter. A U.S. bank lobbying group petitioned the agency that issues federal banking charters, the Office of the Comptroller of the Currency, to reject Coinbase's application for a trust charter, arguing the crypto exchange falls short of requirements in several categories.
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