Two crypto-related firms have advanced applications for federal trust bank charters with the Office of the Comptroller of the Currency (OCC) this week, pressing ahead with expansion plans despite a fresh legal challenge seeking to dismantle the very regulatory framework they hope to operate under.
Bahrain-based Rain disclosed it has formally applied for a US limited-purpose national trust bank charter, according to Cointelegraph. The filing came mere days after community banking associations filed a lawsuit asking a federal court to overturn OCC rules that permit crypto-focused trust charters. Rain's application places it among a growing contingent of digital asset firms pursuing federal trust bank status as a pathway to offer custody and related banking services under federal supervision.
The timing underscores a widening gulf between industry participants racing to secure regulatory legitimacy and traditional banking interests fighting to preserve the status quo. Community banks, represented by trade associations including the Independent Community Bankers of America and the American Bankers Association, contend that the OCC overstepped its authority by granting trust charters to crypto-native firms that they argue should face stricter banking requirements.
Modern Treasury, a payments infrastructure provider, filed its own application for a limited-purpose national trust bank charter on October 5, seeking federal approval to custody stablecoins and provide associated fiat services, Cointelegraph reported. The San Francisco-based company, which builds treasury management software for businesses, would use the charter to bridge traditional fiat operations with digital asset custody.
Both applications follow a well-trodden path. Anchorage Digital, Paxos, and other crypto firms have previously secured OCC trust charters, establishing a template for firms seeking federal oversight without the full capital and compliance burdens of a traditional bank holding company. The limited-purpose structure allows firms to engage specifically in trust activities—including asset custody and fiduciary services—while avoiding broader commercial banking operations.
The community bank lawsuit, filed in the US District Court for the District of Columbia, challenges the OCC's 2020 interpretive letter and subsequent guidance that clarified national banks and federal savings associations could provide cryptocurrency custody services. The banking groups argue these pronouncements violated administrative procedure and statutory constraints on the OCC's chartering authority.
Rain and Modern Treasury's decisions to proceed despite the litigation suggest confidence either in the legal resilience of the OCC framework or in the strategic value of securing federal trust status regardless of outcome. For international operators like Rain, a US federal charter offers substantial credibility advantages and potential access to dollar clearing and correspondent banking relationships that remain difficult to obtain through state-licensed alternatives.
Modern Treasury's stablecoin custody angle reflects evolving market demand as institutional treasuries increasingly seek regulated on-ramps for digital dollar instruments. The company's existing fiat infrastructure positions it to offer integrated custody and payment services that would compete directly with both crypto-native custodians and traditional banks developing digital asset capabilities.
The OCC has not publicly commented on how it will adjudicate pending applications while defending its chartering authority in court. Acting Comptroller Michael Hsu has previously expressed caution about crypto integration into federal banking, though the agency has continued processing trust charter applications during his tenure.
Should the community banks prevail, the consequences would extend well beyond these two applications. Existing OCC-chartered crypto trusts could face operational uncertainty, and the pathway to federal banking supervision for digital asset firms would narrow substantially, likely pushing more activity toward state regulatory frameworks.