Payment infrastructure firm Modern Treasury has officially submitted an application to the US Office of the Comptroller of the Currency (OCC) to establish a federally chartered bank. This expansion is aimed at creating an independent entity named Modern Treasury National Trust Bank, dedicated to digital asset custody and management.
The limited-purpose trust institution will pave the way for institutional clients to store and transfer stablecoins alongside fiat currency under a single gateway. Its operational boundaries are strictly drawn: the new bank functions purely as a custodian, is not permitted to issue its own stablecoins, and holds no authority to provide credit lending facilities.
Matt Marcus, CEO and co-founder of Modern Treasury, explained that the decision to pursue a banking license was driven by the firm’s conviction regarding market adoption. He noted that stablecoins have already evolved into fundamental economic infrastructure for the future financial system.
Modern Treasury’s track record ahead of entering federal banking territory has already been proven through tangible transaction figures. Its platform has facilitated payment volumes exceeding $600 billion across hundreds of organizations spanning various sectors.
Racing for Federal Approval
Modern Treasury joins a growing queue of crypto firms racing to enter the formal United States banking system. The OCC is currently reviewing a stack of national trust charter applications filed in quick succession. Circle and BitGo have already secured the top spots after receiving final approvals.
A tier below, Bastion and Ripple currently hold conditional approval status requiring compliance with further standards. Meanwhile, other applicants such as Kraken through its Payward business arm, Zerohash, and Block are still awaiting document evaluation from the OCC.
The wave of OCC approvals has not unfolded without political friction, particularly concerning clearance for World Liberty Financial. Granting federal approval to the Trump family-affiliated crypto entity sparked a flurry of protests from numerous members of Congress. Lawmakers highlighted potential high-level conflicts of interest and probed alleged discreet ties between the project and the United Arab Emirates royal family.
Legal Backlash From Traditional Bankers
The crypto industry’s accelerating push into federal banking territory has ultimately triggered a courtroom battle. The Independent Community Bankers of America (ICBA), representing conventional community lenders, officially filed a lawsuit against the OCC in the US District Court in Washington, D.C.
The ICBA lawsuit alleges that the regulator acted improperly by approving federal bank charters for crypto entities without imposing equivalent guardrails. Traditional bankers strongly protest the absence of any requirement for crypto firms to comply with the Community Reinvestment Act.
The complaint also highlights perceived regulatory favoritism regarding lenient capital standards, minimum liquidity requirements, and the complete lack of FDIC deposit insurance coverage for the new trust entities.
The crypto industry swiftly closed ranks to push back against the legal challenge. Crypto Council for Innovation (CCI) CEO Ji Hun Kim characterized the ICBA’s action as a blatant maneuver to derail the issuance of national trust charters. He argued that the lawsuit was specifically designed to stifle digital payment innovation and avoid competition in the financial services sector.
The legal clash underscores that securing a federal charter is no longer just about passing document reviews, but an effort to dismantle legacy bankers’ monopoly over access. Reported via Cointelegraph.
Read also: What Is DeFi (Decentralized Finance)?
Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
