ABA Calls on OCC To Slow Crypto Bank Charter Approvals

Amid a wave of applications from crypto firms and digital-first banks seeking national bank charters, the American Bankers Association (ABA) has called on regulators to pause before granting further approvals.

In a letter to the Office of the Comptroller of the Currency (OCC), the trade body urged the watchdog to move cautiously while Congress and other authorities continue to shape the rules governing stablecoins and other digital assets.

It warned that approving applications before those frameworks are fully defined could create risks for the financial system and weaken the transparency standards that have underpinned US banking for decades.

The appeal comes as a growing list of firms — including Revolut, World Liberty Financial, PayPal, Erebor Bank, Coinbase, Paxos, Ripple, and Circle — pursue chartered licenses that would bring them under federal banking supervision.

According to the ABA, one of the core challenges is that the responsibilities of many recent and prospective applicants “are not readily identifiable today”  because lawmakers and regulators have yet to fully define how entities engaged in stablecoin and digital asset activities should be regulated. In that context, the association said the OCC must ensure strong safety and soundness standards are maintained and that the chartering process remains transparent.

The group also used its submission to press for tighter naming rules. It encouraged the OCC to amend its regulations so that any charter applicant other than a subsidiary of a bank or bank holding company that limits its activities to fiduciary services or trust company operations would be barred from including the word “bank”  in its name.

Such a step, ABA argued, would prevent institutions from adopting titles that misrepresent the nature of their activities or the services they offer, reducing the risk of consumer confusion as new types of financial firms seek entry into the national banking system.