U.S. Community Bankers Warn Against OCC’s Conditional Approval of Coinbase Trust Charter

A U.S. banking trade group is pushing back against regulators after the Office of the Comptroller of the Currency (OCC) granted conditional approval for Coinbase National Trust Company, arguing the decision could weaken oversight and expose consumers to added risk. The Independent Community Bankers of America (ICBA) said the OCC's action, issued April 2, was "a grave mistake" and contended Coinbase's trust charter application does not satisfy requirements under the National Bank Act or the agency's own standards. ICBA President and CEO Rebeca Romero Rainey also criticized the OCC's rule framework for national trust banks, calling it inconsistent with statutory authority as reflected in legislative history, court interpretations and agency precedent. Coinbase's filing, submitted on Oct. 3, 2025, proposes establishing a noninsured national trust bank headquartered in New York as a wholly owned subsidiary of Coinbase Global Inc. The planned entity would focus on institutional custody, trading integration and fiduciary digital-asset services, supported by a board and executive team. Coinbase's proposal also describes compliance, security and anti-money-laundering controls, along with a nationwide digital-only delivery model aimed at institutional clients rather than a branch network. In its letter, ICBA pointed to what it characterized as operational shortcomings, including weak risk controls, limited profitability prospects and unresolved resolution planning. The group said these issues signal structural fragility in the proposed trust-bank model and warned that expanding nonfiduciary trust powers could exceed regulatory authority and complicate financial supervision. ICBA also argued that a growing wave of applications from nonbank firms reflects efforts to obtain charter benefits without meeting the full set of regulatory obligations, potentially leading to uneven standards across the industry. It further criticized allowing uninsured national trust banks to pursue cryptocurrency-related activities without tighter prudential requirements, saying such an approach could sidestep safeguards applied to traditional banks. The organization urged regulators to withdraw or revise the OCC's chartering rule to better align with statutory authority and established precedent, and said it will continue engaging policymakers as digital-asset companies seek deeper integration into the U.S. banking system.