Big US Banks May Sue Regulator Over Crypto

The heart of the dispute is the national trust bank charter, which allows a company to hold and manage assets for clients across all 50 states under a single federal regulator, the OCC. Unlike full-service banks, these trust banks cannot take consumer deposits or make loans as a primary business, and therefore are not subject to the same capital rules, FDIC insurance requirements, or consolidated supervision by the Federal Reserve. This conflict has been brewing for years, but accelerated dramatically in late 2025 and early 2026. On December 12, 2025, the OCC granted conditional approval for national trust charters to five crypto-native firms at once: Ripple, Circle, BitGo, Fidelity Digital Assets, and Paxos. By March 2026, at least eleven companies, including major players like Crypto.com and Morgan Stanley, had either received conditional approval or had applications pending. The recent surge in applications was partly driven by the "Guiding and Establishing National Innovation for US Stablecoins Act" (GENIUS Act), signed into law in July 2025. This landmark legislation created a federal framework for stablecoins, making national trust banks permissible issuers and increasing the attractiveness of the charter for digital asset firms. The OCC further cleared the path with a rule change effective April 1, 2026, which unambiguously clarified that national trust banks can perform non-fiduciary custody services, a core function for many crypto firms. The Bank Policy Institute (BPI), a lobbying group whose board includes the CEOs of JPMorgan, Goldman Sachs, and Bank of America, argues this creates a dangerous loophole. They contend that allowing firms to offer bank-like products with "a lighter regulatory touch" blurs the statutory definition of a bank, invites systemic risk, and creates an uneven playing field. The BPI and other groups like the Independent Community Bankers of America warn this could undermine consumer protection and financial stability. The OCC, under the leadership of Jonathan Gould, a Donald Trump appointee and former crypto executive, has pushed to integrate fintech and crypto firms into the federal banking system. The agency maintains that it applies the same rigorous standards to all applicants and that these new entrants are good for consumers and promote innovation. However, this represents a significant shift from the more cautious stance of previous Acting Comptroller Michael Hsu, who had warned about the hidden risks of complex bank-fintech partnerships. This isn't the first time banking groups have clashed with regulators over new rules. The BPI previously sued the Federal Reserve in late 2024 over changes to bank stress tests, a case that resulted in the Fed agreeing to revise its rules. That precedent suggests the current threat of a lawsuit is a serious escalation in the fight over the future structure of banking and crypto regulation in the U.S.