Bankers sue to overturn OCC trust-bank rule used by crypto firms

The Independent Community Bankers of America sued the OCC in federal court docket in Washington on Oct. 2, two weeks after the company authorised Agora National Trust Bank, Catena Trust Bank and Bastion Platforms.

American Banker reported that the criticism requested the court docket to vacate the OCC’s nationwide belief financial institution rule and Interpretive Letter 1176. It argued the company exceeded its authority by widening limited-purpose belief charters for fintech and crypto firms.

ICBA says the OCC has authorised or conditionally approved 21 trust banks, 13 of them tied to crypto.

Banks misplaced the applicant-by-applicant battle towards crypto firms

Banking teams objected firm by firm, and the OCC kept approving. Five crypto-linked nationwide belief functions, together with BitGo, Fidelity Digital Assets, First National Digital Currency Bank, Paxos and Ripple-linked candidates, gained selections in December 2025.

Bridge, National Digital Trust and Foris DAX, the dad or mum of Crypto.com, adopted in February, Coinbase in April and Laser Digital in May. Agora, Catena and Bastion arrived Sept. 18, and a number of other of those approvals are conditional or preliminary.

The OCC finalized its nationwide belief financial institution rule in February, efficient April 1. It changed the phrase “fiduciary actions” with the statute’s broader wording, “the operations of a belief firm and actions associated thereto.”

The OCC says the language leaves its chartering authority intact and that national trust banks have lengthy carried out some nonfiduciary work, together with custody. It factors to 12 U.S.C. 24(Seventh) as authority for nonfiduciary custody and associated actions.

ICBA’s criticism reads the identical rule as stretching a limited-purpose belief constitution to cowl non-depository, non-fiduciary crypto companies below a lighter framework than insured banks face.

An objection to Coinbase or Ripple asks the company to deny one applicant. A swimsuit over the rule asks a decide to resolve the scope of authority behind each constitution that depends on it.

The OCC mentioned a court docket would resolve

In the February rule, the OCC cited the Supreme Court’s Loper Bright resolution. It mentioned that when a celebration with standing disputes whether or not the National Bank Act authorizes a nationwide belief financial institution constitution, courts should train unbiased judgment on the statutory query.

That is the assessment ICBA now requests. The OCC spent 2026 approving crypto belief charters whereas on file {that a} court docket would settle their authorized foundation.

Exposure varies with marketing strategy, with plain fiduciary custody furthest from the dispute and nonfiduciary custody, stablecoin issuance and reserves, funds, settlement, conversion, and execution nearest to it.

Coinbase’s authorised plan covers digital asset custody as a fiduciary plus transactional providers tied to custodied belongings, and the OCC defended it as trust-company operations or associated actions below fiduciary authority and 24(Seventh).

Agora plans dollar-backed stablecoin issuance, reserve upkeep, nonfiduciary custody, and cost and settlement providers. Catena combines custody, funding administration, and belief providers with conversion, clearing, and execution, and Bastion affords white-label stablecoin issuance, custodial wallets, conversion, and issuer providers.

Foris DAX’s plan {couples} custody with commerce settlement and staking, and Bridge’s preliminary approval covers custody, stablecoin issuance and orchestration, and reserve administration.

ICBA seeks vacatur plus declaratory and injunctive reduction. What occurs to present charters relies on the order a decide writes, together with the way it treats ultimate approvals, conditional approvals and actions with unbiased statutory assist.

The OCC mentioned in August that it had obtained 40 de novo constitution functions over about 18 months, and Comptroller Jonathan Gould mentioned 23 of them concerned digital belongings.

The company’s digital-asset licensing web page lists pending candidates, together with zerohash, Dakota National Trust Bank, Payward (Kraken), Lorum National Trust Bank, EDX Trust and PAYO Digital Bank.

Whether the OCC retains processing these functions on the identical phrases whereas the court docket weighs the rule is the open query for every of them.

Where the court docket crypto check leads

If the court docket sides with the OCC, the nationwide belief financial institution turns into a firmer federal route for crypto custody and stablecoin infrastructure.

JPMorgan sees $500 billion by 2028, Coinbase’s mannequin facilities on $1.2 trillion by the tip of 2028, and Standard Chartered expects $2 trillion by then. Citi’s 2030 circumstances run from $1.9 trillion in its base situation to $4 trillion in its most optimistic one.

FDIC-insured banks held about $20.7 trillion in deposits within the second quarter, so $500 billion to $2 trillion equals roughly 2.4% to 9.7% of that base. For Bitcoin, a win would deepen bank-supervised custody and settlement-linked providers for establishments.

If the court docket vacates or narrows the rule or the letter, the impact lands hardest on plans constructed round stablecoin issuance, reserves, nonfiduciary custody, conversion, funds and settlement.

Those firms would possibly restructure actions into associates, state belief firms or partner-bank preparations, and pending charters might face more durable assessment. Bitcoin custody itself might keep accessible, with the federal wrapper much less versatile round adjoining providers similar to conversion, execution, settlement, staking-like providers and collateral motion.

The San Francisco Fed estimates stablecoin issuers’ Treasury demand might roughly double to about $400 billion by 2030, which provides the reply weight past crypto.

How a lot nonfiduciary market infrastructure can sit inside a nationwide belief financial institution is now a query for a federal decide, which is the place the OCC mentioned it could land.

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