Coinbase receives conditional approval for US trust charter

Chief legal officer Paul Grewal announced the approval on Thursday, thanking OCC head Jonathan Gould, who took office less than a year ago.

The US Office of the Comptroller of the Currency (OCC) has approved cryptocurrency exchange Coinbase’s application for a national bank trust charter after six months of consideration.

In a Thursday X post, Coinbase chief legal officer Paul Grewal said the company received conditional approval for the OCC application, following December approvals for Ripple Labs, BitGo, Circle, Fidelity Digital Assets and Paxos.

Although the company said in October it had “no intention of becoming a bank" if approved, the move by US regulators marks one of the most significant forays into bridging crypto and traditional finance.

“Coinbase is not becoming a commercial bank,” said vice president of institutional product Greg Tusar in a Thursday blog post. “We will not be taking retail deposits. We will not be engaging in fractional reserve banking. This charter is about bringing federal regulatory uniformity to the custody and market infrastructure business we have been building for years.”

Tusar said that the company would continue to operate under the Department of Financial Services in New York, where it holds a BitLicense and a state charter as a limited-purpose trust company.

The OCC approval, coupled with Coinbase’s state-level efforts, came as the company is in the middle of a debate on issues stalling a digital asset market structure bill in Congress, including over stablecoin yield.

CEO Brian Armstrong said in January that the exchange could not support the legislation as written. Lawmakers on the Senate Banking Committee later postponed a markup, which is necessary before a potential floor vote on the bill.

Related: Coinbase exec says Senate CLARITY compromise is close, but no markup date set

At the time of publication, the OCC website showed no change to Coinbase’s application, which it marked as received by the banking regulator. Cointelegraph reached out to the exchange for comment but did not receive an immediate response.

The crypto platform rolled out prediction market bets for US-based users in January as part of a partnership with Kalshi.

In lawsuits filed preemptively against state gaming authorities in Connecticut, Illinois and Michigan, Coinbase argued that the US Commodity Futures Trading Commission, as a federal regulator, had the authority to oversee prediction markets. Many of the cases were ongoing as of Thursday.

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Source: CoinTelegraph