Here’s the thing: everyone expected the OCC, under Trump’s watchful — or perhaps not-so-watchful — eye, to be… lenient. That’s putting it mildly. But no one, not even the most jaded observer of D.C. machinations, anticipated this level of blatant regulatory shell-gaming.
Now, Sen. Elizabeth Warren (D-MA), a senator whose skepticism towards crypto is as legendary as her glare, is calling out the Office of the Comptroller of the Currency (OCC) for what she deems illegal approvals of national trust bank charters for crypto firms. It’s not just a gentle nudge; it’s a full-throated accusation that these charters, granted to outfits like Coinbase and Ripple, are essentially a regulatory loophole designed to bypass fundamental banking safeguards.
Are These Crypto Banks or Just Clever Companies?
Warren’s letter to Comptroller Jonathan Gould is a masterclass in pointed accusation. She argues these companies are operating less like the limited-scope trust companies the OCC claims they are, and more like actual banks. Think about it: they want the flexibility, the perceived legitimacy, but not the inconvenient baggage of deposits, capital requirements, and the like. Warren points out their business plans scream “bank-like activities” — custody, payments, even lending and stablecoin issuance that closely mimics deposit-taking.
“These companies are effectively crypto banks that want to evade the fundamental safeguards and obligations that come with being a bank.”
This isn’t hyperbole. The OCC has rubber-stamped charters for a who’s who of the crypto world: Coinbase, Circle, Ripple, Paxos, BitGo, Fidelity, Crypto.com, Stripe, and Protego. All of them, under this specific charter, operate with less scrutiny than traditional banks. Less scrutiny. Because that’s what the banking system needs right now, right? More risk, less oversight.
A Trump-Era Hangover?
And then there’s the Trump angle. Because of course there is. Warren is sniffing around the OCC’s historical ties to the former president, specifically a charter application linked to World Liberty Financial, a company reportedly connected to Trump’s family and associates. She’s demanded correspondence, looking for any whiff of undue influence. Given the OCC’s general laissez-faire approach during that administration—and frankly, often since—this isn’t a surprising line of inquiry. It suggests that the spirit of deregulation, of finding “ways around” rules, might be baked into these approvals.
The Real Danger: Erosion of Trust
This isn’t just about a few crypto companies getting a slap on the wrist. This is about the integrity of the U.S. financial system. When regulators grant charters that blur the lines between regulated banks and less-regulated entities, they erode public trust. Customers, and frankly the broader market, need clarity. They need to know that when something is called a “bank,
