Over 2023–24, several US banks cut ties with crypto exchanges, stablecoin issuers, and custodians, forcing many firms to rely on a shrinking pool of correspondents and offshore entities for basic payment and settlement. This week, that phase ended.
Over 2023–24, several US banks cut ties with crypto exchanges, stablecoin issuers, and custodians, forcing many firms to rely on a shrinking pool of correspondents and offshore entities for basic payment and settlement.
This week, that phase ended.
The U.S. Office of the Comptroller of the Currency (OCC) has conditionally approved national trust bank charters for Circle and Ripple, alongside trust conversions for Paxos, BitGo, and Fidelity Digital Assets. With a single regulatory move, core crypto infrastructure was pulled inside the federal banking perimeter.
This is not a win for decentralisation.
It is a decisive act of domestication.
What the OCC Actually Approved
A national trust bank charter is a specialised banking license. It lets a firm operate nationally under OCC supervision, but as a trust bank focused on custody and fiduciary‑type services rather than a deposit‑taking, FDIC‑insured commercial bank.
Under these approvals:
Circle and Ripple can establish federally supervised trust banks focused on custody and stablecoin reserve management.
Paxos, BitGo, and Fidelity Digital Assets can convert existing trust entities into nationally recognised institutions.
All approved entities operate under OCC oversight, including capital standards, examinations, and enforcement authority.
In practical terms, the OCC has declared that crypto custody and stablecoin infrastructure are no longer experimental. They are financial utilities.
Why This Ends the “Banking Blockade”
Until now, crypto firms depended on a fragile network of correspondent banks and state trust licenses. That dependency gave traditional banks leverage. Access could be withdrawn without legislation, simply through risk committees and compliance decisions.
A national trust charter removes that choke point.
These firms no longer need permission from dozens of state regulators or reliance on commercial bank partners to operate at scale. They now sit directly under the federal banking system, with the legal authority to custody assets nationwide.
This directly contradicts the arguments made earlier this year by banking trade groups that urged the OCC to block these applications. The regulator’s response is clear: crypto will not be excluded, but it will be absorbed on federal terms.
The Domestication Thesis Becomes Reality
For years, crypto’s narrative was disruption. Replace banks. Bypass intermediaries. Build parallel systems.
That era is ending.
What the OCC has done is confirm a different future:
Crypto does not replace banks.
Crypto becomes bank-like infrastructure.
Innovation survives, but only inside regulated rails.
Stablecoins, custody, and settlement are now being rebuilt as supervised financial plumbing. That brings credibility and scale, but it also raises the cost of entry dramatically.
Compliance is no longer optional. Capital is no longer optional. Informality is no longer tolerated.
Winners, Losers, and the Shape of the Market
Visuals: Winners vs Losers matrix
Two‑column visual listing:
Winners: large, well‑capitalised firms (Circle, Ripple, BitGo, Paxos, Fidelity Digital Assets), institutions, regulators.
Losers: small custodians, offshore operators, lightly regulated startups.
This decision creates clear structural outcomes.
Winners
• Large, well-capitalised firms that can absorb bank-grade compliance.
• Institutional investors seeking regulated custody and settlement.
• Regulators who gain transparency into crypto’s most critical infrastructure.
Losers
• Smaller custodians and offshore operators dependent on regulatory gaps.
• Startups that assumed custody would remain lightly regulated.
• Builders who expected permissionless access to remain cheap and open.
This is how oligopolies form. Not through bans, but through compliance thresholds.
Global Consequences Will Follow
U.S. banking decisions rarely stay domestic.
Once Circle and Ripple operate as federally supervised trust banks, their models become reference standards for regulators in Europe, the UK, and Asia. Jurisdictions that were debating how to treat stablecoins and crypto custody will now have a clear template.
This accelerates global convergence. Regulatory arbitrage windows narrow. Offshore models face increasing pressure.
The message to the world is simple: if crypto wants access to real financial scale, it will operate like a bank.
The Question That Matters Now
The crypto industry spent years fighting to be recognised by the financial system. That recognition has arrived, but not in the form many expected.
The real question is no longer whether crypto will integrate with banking.
It is whether builders, issuers, and custodians are prepared to survive in a system where federal oversight, capital discipline, and legal accountability are permanent features, not temporary obstacles.
The blockade is over.
The perimeter has moved.
And the rules inside it are much stricter than the ones outside ever were.
