Paxos, Ripple, Circle and others secure US trust bank approvals

The US Office of the Comptroller of the Currency has conditionally approved five national bank charter applications for companies tied to the digital assets industry.

In a Friday notice, the OCC said it had conditionally approved BitGo, Fidelity Digital Assets and Paxos to convert their existing state-level trust companies into federally chartered national trust banks. In the same announcement, the regulator said it had conditionally approved new applications from Circle and Ripple for national trust bank charters.

“New entrants into the federal banking sector are good for consumers, the banking industry and the economy,” said Jonathan Gould, the Comptroller of the Currency, adding: “The OCC will continue to provide a path for both traditional and innovative approaches to financial services to ensure the federal banking system keeps pace with the evolution of finance and supports a modern economy.”

The five crypto companies are just a few of the many in the industry seeking regulatory approval from the OCC to expand their presence in the banking sector. Cryptocurrency exchange Coinbase said in October it had filed an application but had “no intention of becoming a bank.”

Related: Circle, BitGo about to apply for bank charters, others may follow: WSJ

Although the wording of each applicant’s letter was slightly different, the companies said they would utilize the charters to provide digital asset custody services to clients. Though Paxos’ application permitted the bank to issue stablecoins, Ripple’s explicitly said its charter would “not be a stablecoin issuer” for its US dollar-pegged coin, RLUSD (RLUSD).

“Paxos’ federally regulated platform will allow businesses to issue, custody, trade and settle digital assets with clarity and confidence,” said Paxos in a Friday statement.

BitGo is also set to go public

The OCC approval came amid the US Securities and Exchange Commission reviewing BitGo’s application for an initial public offering. The company filed in September to list its stock on the New York Stock Exchange, reporting about $90 billion in assets in its custody.