Crypto exchange Coinbase is taking steps towards acquiring a National Trust Company Charter from the U.S. Office of the Comptroller of the Currency (OCC), aligning itself with several other U.S.-based cryptocurrency firms chasing this license.
“Coinbase is taking a significant step in expanding our business capabilities and regulatory oversight beyond the existing framework, paving the way for innovation and growth in building a modern financial system powered by digital assets,” Coinbase mentioned in a statement.
Coinbase Aims to Connect with Traditional Finance
The company emphasizes that seeking this license is part of its mission to bridge the gap between cryptocurrency and the traditional financial sector, while clarifying its stance on not becoming a bank:
“Coinbase has no intention of becoming a bank. We believe that having clear regulations and the trust of regulators and customers allows us to innovate confidently while ensuring necessary oversight and security.”
Luke Youngblood, a prior Coinbase employee noted for his work related to Coinbase staking rewards, explained in a podcast that acquiring the license would enable the platform to integrate its own on-ramps and off-ramps, reducing reliance on partner banks.
Coinbase
Source: Coinbase
Coinbase pointed out that receiving the charter would enhance its offerings beyond mere custody services, facilitating expansions into payment solutions under clearer regulatory oversight.
However, political analyst Brendan Pedersen indicated that while trusts have more restrictions compared to conventional banks, such distinctions have become less clear over time.
Former High-Level Executive Reviews App Development
Youngblood shared that there have been substantial improvements to the Coinbase retail application since his departure in 2022, noting positive developments in the user experience and performance of features like the Coinbase debit card.
“You can really tell they’ve hired some top engineering talent,” he remarked.
The movement to pursue the National Trust Company Charter is shared among multiple crypto firms, as seen with stablecoin issuer Circle’s recent application and Ripple Labs’ concurrent licensing endeavor.
Brad Garlinghouse, CEO of Ripple, mentioned that if granted, the license would set a potential new standard for trust in the stablecoin market.
