Block Seeks National Trust Bank Charter to Streamline Crypto Operations

Block, the company behind the Square payment terminals and Cash App, has submitted paperwork to establish an uninsured national trust bank called Builders Bank & Trust. If approved by the Office of the Comptroller of the Currency (OCC), Block would operate Builders Bank as a provider of custody and related fiduciary services for Bitcoin and stablecoins.

The emphasis on digital financial instruments is revealing, as it puts custodial and fiduciary activities under a single charter overseen by the OCC. This drastically reduces the need to pay custody fees for managed assets, making it easier and less expensive to operate a Bitcoin and stablecoin business.

Block's Bitcoin business has been a significant source of revenue, with nearly $1.9 billion in Bitcoin-derived revenue in its most recently reported quarter, accounting for nearly 29% of total net revenue. However, the company's stablecoin operations generate negligible revenue, primarily aimed at facilitating quick transactions in other assets.