US Banking Lobby Groups Question Crypto Firms’ Applications for Banking Licenses

According to a report by Jinse Finance, U.S. banking groups are urging the country's banking regulators to delay decisions on granting banking licenses to cryptocurrency companies until the details of these companies' plans are made more transparent. They claim that allowing these applications would represent a "fundamental departure" from existing policy. The American Bankers Association and other industry organizations representing banks and credit unions sent a letter to the Office of the Comptroller of the Currency (OCC) on Thursday, stating that approving national banking licenses for cryptocurrency companies—including stablecoin issuer Circle Internet Group and Ripple Labs—"would raise significant policy and procedural concerns." These groups argue: "There are major policy and legal questions as to whether the proposed business plans of the applicants involve the types of fiduciary activities performed by national trust banks." Circle, Ripple, and Fidelity Digital Assets are among the recent batch of cryptocurrency companies applying for banking licenses from the OCC. Obtaining these licenses would essentially allow them to become their own banks, enabling faster payment settlements and subjecting them to federal regulation, which would allow them to operate in all states across the U.S.