Coinbase seeks national trust charter to expand crypto custody business

Coinbase Global (NASDAQ:COIN) has applied for a national trust company charter from the U.S. Office of the Comptroller of the Currency to grow its crypto custody business, it said in a recent blog post.

This particular kind of license, also called a limited-purpose national bank charter, would let Coinbase (NASDAQ:COIN) operate as a federally regulated trust company, giving the crypto exchange the ability to offer custody and related banking services across the U.S. under one federal license instead of dealing with many state-by-state rules.

But Coinbase (NASDAQ:COIN) isn't pursuing the license to become a bank. It has "no intention" of doing so, Greg Tusar, vice president, Institutional Product for Coinbase, said in the post.

"If approved, the charter would continue to open up opportunities for Coinbase to launch new products beyond custody, including payments and related services, with the confidence of regulatory clarity, fostering broader institutional adoption," he added.

The company will continue to operate under the oversight of the New York Department of Financial Services as it awaits approval.

Coinbase (COIN) is not the first crypto firm to pursue for a federal charter. In August, stablecoin issuer Paxos applied to convert its NYDFS bank charter into a national trust charter under OCC supervision. 

Circle Internet Group (CRCL), the company behind stablecoin USDC (USDC-USD), is among some of the other crypto firms submitting an application to create a national trust bank, underscoring demand for a clearer, nationwide legal framework to offer crypto custody, payments and stablecoin services.