Custodian Anchorage Seeks Charter From Crypto-Friendly US Bank Regulator OCC

If its application is approved, Anchorage would be the first crypto company to get a national bank charter.

AccessTimeIconNov 17, 2020 at 6:16 a.m. UTC
Updated Sep 14, 2021 at 10:31 a.m. UTC

The cryptocurrency and banking worlds continue to draw closer together with digital asset custodian Anchorage seeking a national charter from the U.S. Office of the Comptroller of the Currency.

The startup's trust company unit, based in South Dakota, has applied to the OCC to convert to a national bank, according to a notice dated Nov. 9 and posted to the federal regulator's website.

The notice contains little else in the way of detail, except that Anchorage is represented by Dana Syracuse of the law firm Perkins Coie. Syracuse is a former general counsel of the New York Department of Financial Services and helped that agency draft its landmark BitLicense regulation.

This year Kraken, a crypto exchange, became the first such business to obtain a U.S. banking license, albeit a special-purpose one from Wyoming (the same kind obtained by digital asset startup Avanti). If its application is approved, Anchorage would be the first crypto company to get a national bank charter, explicitly allowing it to do business in all 50 states.

A banking charter would give Anchorage the clear authority to act as a "qualified custodian" for institutional investors under Securities and Exchange Commission (SEC) rules. Most crypto custody firms in the U.S. have trust company licenses, but the SEC signaled last week that it is unsure whether such entities, regulated at the state level and less stringently than banks, make the cut as qualified custodians.

Anchorage's application also comes at a time when the OCC, an agency that has existed since the Civil War, may be unusually receptive to such requests. Brian Brooks, the acting comptroller since May, is a former chief legal officer for the Coinbase exchange and has been notably focused on clearing the way for banks to participate in the crypto market – so much so that he was recently criticized by lawmakers for spending so much time on this niche during a pandemic.

In July, for example, Brooks' agency issued a letter clearing the way for national banks to safeguard private cryptographic keys for digital currency wallets, a business that until now has been the province of specialist firms like Anchorage.

"Anchorage is encouraged by the recent positive progress out of the OCC with respect to regulatory clarity around custody of digital assets," Nathan McCauley, Anchorage's co-founder and CEO, said in a Telegram message. "We are interested in obtaining an OCC charter as a way to better serve the emerging needs of large banks looking to integrate crypto to bring the benefits of Bitcoin and other digital assets to their client base."

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