Banks Sue OCC Over Crypto Trust Charter Approvals
The Office of the Comptroller of the Currency (OCC) has been at the center of a heated dispute between the banking sector and the crypto industry. The Independent Community Bankers of America (ICBA) has filed a lawsuit against the OCC, alleging that it 'exceeded its authority' in granting national trust bank charters to several crypto and fintech firms.
The lawsuit targets the OCC's approval of conditional national trust bank charters for companies like Ripple, Circle, Paxos, Fidelity Digital Assets, Revolut, and World Liberty Financial. These approvals allow them to provide asset custody and settlement services nationwide, but exempt them from FDIC insurance for consumer deposits.
The ICBA argues that this exemption allows crypto firms to enter the banking system under 'lightly regulated national charters' rather than more rigorously regulated traditional bank charters. This, they claim, creates unfair competition for community banks and could spread financial market instability.