XRP News Today: Crypto firms seek federal trust charters to bridge traditional finance divide

Crypto.com, a major cryptocurrency exchange, has joined Ripple and Coinbase in pursuing a national trust bank charter to expand its services under federal oversight, according to a CryptoBriefing report. The move reflects a broader trend among digital asset firms seeking to streamline operations by bypassing state-by-state regulatory hurdles. A federal license would allow Crypto.com to offer trust and custody services nationwide without the need for individual state approvals, a process that has long complicated the crypto industry's regulatory landscape.

The national trust bank charter, a specialized financial license, enables institutions to operate under a single federal framework rather than navigating a patchwork of state laws. For Crypto.com, this could accelerate its ability to provide regulated custody and staking services to institutional and retail clients. The company's filing signals confidence in the U.S. regulatory environment's capacity to accommodate crypto firms while maintaining compliance standards.

This development aligns with broader industry efforts to gain legitimacy in traditional finance. Ripple and Coinbase, which have also applied for similar charters, are part of a growing cohort of crypto firms aiming to integrate more seamlessly into the banking system. A federal charter could reduce operational friction and enhance trust among institutional investors wary of the sector's historical volatility.

The push for federal oversight comes as regulators scrutinize crypto custodians following high-profile failures like the collapse of Fortress Trust. Nevada regulators recently issued a cease-and-desist order against Fortress, citing severe liquidity issues and an inability to meet client obligations, according to a Bloomberg report. Such cases underscore the need for robust compliance frameworks, which a national trust charter aims to enforce.

For Crypto.com, the potential benefits extend beyond regulatory efficiency. A federal license could position the firm as a competitive player in a market where trust and security are paramount. By operating under a unified regulatory umbrella, the company may attract a broader range of clients, including pension funds and hedge funds, which require stringent compliance measures.

However, the path to obtaining a charter is not without challenges. The Office of the Comptroller of the Currency (OCC), which oversees national bank charters, has yet to finalize rules for crypto custodians. Critics argue that the current framework lacks clarity on how digital assets should be treated under federal banking law. Crypto.com's application may prompt further dialogue with regulators to address these gaps.

The industry's shift toward federal oversight also highlights the evolving relationship between crypto firms and traditional financial institutions. As companies like Ripple and Coinbase demonstrate a commitment to compliance, they may pave the way for broader acceptance of digital assets within the mainstream financial system.