Coinbase Seeks Banking Breakthrough

A major player in the crypto exchange landscape, Coinbase, has recently submitted an application to the Office of the Comptroller of the Currency (OCC). This application is for a national trust charter.

The publicly traded firm made the announcement on Friday, aligning itself with other financial technology enterprises, following similar moves by Circle and Paxos, both known for their stablecoin offerings, as well as the fintech company Ripple.

Coinbase anticipates that approval of this charter will streamline the introduction of new products and services. Furthermore, the company believes it will foster innovation related to “integrating digital assets into traditional finance.” This type of license empowers companies—that are not banks—to manage their own reserve assets and provide custody services for institutional clients.

Coinbase clarified that it “has no intention of becoming a bank.” They stated that “clear guidelines and strong relationships with regulators and customers are critical to enable Coinbase to continue innovating responsibly while also ensuring oversight and security.”

The company elaborated, “Should the charter application be successful, Coinbase would gain increased opportunities to introduce products beyond custody, including payments and associated services. This could be accomplished with enhanced regulatory certainty, potentially expanding institutional adoption of digital assets.”

Coinbase did not immediately provide responses to inquiries from Decrypt. 

Anchorage Digital was the pioneer firm in the digital asset industry, and it secured an OCC charter in 2021. Circle and Paxos, issuing the USDC, PYUSD and PAXG stablecoins, respectively, have submitted their applications this year. Additionally, Ripple, the issuer of the RLUSD stablecoin, is also seeking this type of charter.

Coinbase, which is headquartered in San Francisco, California, is expanding its presence within traditional finance. In July, the company finalized an agreement with JPMorganChase, which aims to facilitate faster and easier cryptocurrency purchases for customers.

Coinbase became a publicly traded company in 2021. It also holds a contract with the U.S. Marshals Service (under the Department of Justice), overseeing the management and disposal of seized digital assets, like Bitcoin. The company also provides custodial services for Bitcoin for the Bitcoin ETF products from BlackRock and Fidelity.

Editor’s note: This story has been updated to include further information.