ICBA urged the OCC to reject Stripe’s application for a national trust bank charter for a proposed subsidiary, Bridge National Trust Bank.
Details: In a new letter, ICBA said the OCC must deny the application because:
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Bridge’s proposed business model—which is centered on issuing deposit-substitute stablecoins to the general public without FDIC insurance or banking regulation—represents a dangerous form of regulatory arbitrage.
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It stretches the national trust bank charter beyond its statutory and historical purpose, endangers consumers, undermines community reinvestment, and creates an institution the OCC is not equipped to resolve in an orderly way.
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Approving this charter would set a negative precedent, inviting every fintech giant to repackage demand deposits as “stablecoins” and operate outside the safeguards Congress designed to protect the banking system.
Recent ICBA Comments:
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ICBA last week urged the OCC to reject Sony Bank’s application for a national trust bank charter for a proposed subsidiary, saying it should be subject to the Bank Holding Company Act’s definition of a bank.
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ICBA recently expressed opposition to Coinbase’s application for a national trust bank charter for its subsidiary, Coinbase National Trust Co., on similar grounds.
More ICBA Advocacy:
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A recent ICBA blog post says the sudden influx of applications from nonbank financial technology firms for national bank trust charters requires the OCC to change course.
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ICBA and other groups recently urged the OCC to postpone the consideration of applications to form Ripple National TR Bank, Fidelity Digital Assets, and others, citing significant policy and legal questions over the applicants’ fiduciary activities and the departure from OCC precedent that these applications represent.
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In a previous letter, ICBA urged the OCC to keep in mind several key principles when considering charter applications from digital asset providers, including their unique risks and need for sufficient supervisory and regulatory safeguards.