The Independent Community Bankers of America (ICBA), representing thousands of community banks across the United States, has filed a lawsuit against the Office of the Comptroller of the Currency (OCC) challenging its authority to grant national trust bank charters to cryptocurrency firms.
ICBA questions OCC’s crypto charter process
The legal action, submitted in the District of Columbia, targets the OCC’s recent guidance enabling digital asset companies to operate as national trust banks. ICBA asserts that this process gives crypto firms the appearance and credibility of federally chartered banks without requiring full compliance with standard banking regulations, such as deposit insurance and consumer protection protocols.
National trust charters permit companies to manage customer assets and process transactions, but these entities cannot accept cash deposits or issue loans. ICBA argues that extending such charters to cryptocurrency firms extends the OCC’s mandate beyond its reasonable boundaries.
American consumers reasonably expect a federally chartered bank to carry federal protections. Digital assets held by crypto firms under national trust charters do not include the same safeguards as traditional banks. — ICBA President and CEO Rebeca Romero Rainey
An OCC spokesperson declined to comment on the pending litigation.
Broader pushback from community banks and lawmakers
Tensions over crypto chartering authority have been escalating in recent months. In May, ICBA made a formal objection to the application from Payward, the parent company of US-based crypto exchange Kraken, which sought a national trust charter. OCC records confirm Payward National Trust Company submitted its charter application on May 8.
Senator Elizabeth Warren has also questioned the OCC’s chartering approach. In a May letter, she indicated that since December 2025, the OCC had granted at least nine national trust charters to crypto firms. Warren argued that some of the activities performed by these companies may not fall under the traditional functions permitted to trust companies and could undermine core banking safeguards.
These companies are effectively crypto banks that want to evade the fundamental safeguards and obligations that come with being a bank. — Senator Elizabeth Warren
OCC maintains stance on authority
The OCC, a federal regulator overseeing national banks and federal savings associations, maintains that its April rules do not represent an expansion of its authority. The agency stated that trust-limited banks may conduct a variety of non-traditional activities consistent with longstanding trust company functions.
OCC Comptroller Jonathan Gould reported that over the past 18 months, the agency received 40 applications for new bank charters, including 23 related to digital asset firms. This figure is eight times higher than the four years prior, illustrating a significant surge in crypto-related charter activity.
| Period | Total Charter Applications | Applications for Digital Assets |
|---|---|---|
| Past 18 months | 40 | 23 |
| Previous 4 years | ~5 | ~3 |
Potential impact on the global crypto market
The dispute has the potential to influence international digital asset markets. The Bank for International Settlements estimates that the total volume of stablecoins could surpass $300 billion by 2026, with the vast majority pegged to the US dollar.
At the same time, the Financial Stability Board has identified significant regulatory gaps among jurisdictions, which may result in regulatory arbitrage by crypto operators. The ICBA’s legal challenge is expected to clarify the limits and implications of US federal trust charters for digital asset companies, shaping the regulatory perimeter for the growing sector.
Mini dictionary: OCC – The Office of the Comptroller of the Currency is an independent bureau within the US Department of the Treasury, responsible for regulating national banks and federal savings associations, ensuring their soundness and compliance with regulations.
