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coinbase The company said on Thursday that it has received conditional approval from the US Office of the Comptroller of the Currency (OCC) to operate as a trust bank.
Coinbase chief legal officer Paul Grewal told CNBC that if finalized, the crypto exchange would be able to operate payments products in addition to its custody business under federal supervision.
The company clarified that it would not become a commercial bank, take retail deposits or engage in fractional reserve banking – the practice by large banks of reserving only a fraction of customers’ deposits and lending the rest. Nevertheless, a trust charter would give it the legal authority, access to banking infrastructure and regulatory credibility to move, hold and organize money more efficiently.
“In the long run we will be able to explore offering with the OCC not only custody products but other infrastructure products, particularly around payments, which we think will expand and expand crypto payments in all kinds of new and interesting and important directions,” Grewal said.
While trading for retail and institutional investors is Coinbase’s core business, the company is pushing to increase consumer engagement through new products and services, taking advantage of pro-crypto policies under the Trump administration.
Approval is an initial agreement that Coinbase’s application meets key regulatory requirements, subject to certain conditions being met before it can actually operate as a trust bank.
Coinbase will be regulated directly by the OCC, one of the three main federal banking regulators, rather than being subject to state-based regulation, a major problem for companies in fast-moving industries like crypto.
Grewal pointed to President Donald Trump’s promise to make the US “the crypto capital of the world” in his second term, saying that up to this point, “that was the only way to go about it.” The Biden administration had previously famously maintained an anti-crypto stance, which the industry believes hindered its growth and leadership on the global stage.
State-by-state regulation creates headaches for many fast-paced startups playing in the heavily regulated financial services sector. Instead of a single rule book, companies face 50 different rules that can not only slow down growth but also increase costs.
“If we didn’t think there was significant opportunity in crypto infrastructure, including payments, we wouldn’t pursue it,” Grewal said. “The OCC’s conditional approval is an important recognition by the agency that they want to see those products and services, particularly around payments and custody, developed first and foremost in the US.”
Coinbase has established a payments strategy focused exclusively on creating stable coins circle-issued usdc – into a mainstream global payment method. Last year it launched Coinbase Payments, a product for the platform and merchants that includes wallet integration and stablecoin checkout. It also launched a payment protocol built on its in-house blockchain, Base, with Shopify. Separately, it partnered with Shopify and Stripe to allow their merchant partners to accept the USDC stablecoin.
Coinbase CEO Brian Armstrong has also said that the company has an “extreme goal” of making USDC the No. 1 stablecoin in the world, which it currently holds. Tether’s USDTAnd his goal is to make Coinbase “the number one financial services app in the world” over the next five to 10 years. When it comes to crypto policy, especially in recent conversations around the Clarity Act, Armstrong has become one of the most important private sector voices on Capitol Hill.
