In digital finance, the concept of "bank" is being redefined: How should we interpret OCC's historical decision?

By the end of 2025, the role of the crypto industry in the financial system is undergoing a fundamental transformation. The Office of the Comptroller of the Currency (OCC) within the U.S. Department of the Treasury has conditionally approved five digital asset companies—Ripple, Circle, Paxos, BitGo, and Fidelity Digital Assets—to receive federal trust bank licenses. Whether this is a sign of confidence or an unexpected decision, it marks an important milestone for the market and regulatory spheres.

What is the true value of the license?

Many have simplified this news as “crypto companies being recognized as banks.” But this understanding is incorrect. The federal trust bank status granted by OCC is not equivalent to a traditional commercial bank license — these companies cannot accept public deposits or issue commercial loans.

The real significance lies elsewhere. This license grants organizations the right to connect directly to the Federal Reserve payment system, including Fedwire and other central bank clearing networks. This is a profound change, not a “bank” name change.

In the old world, Circle, Ripple, or Paxos had to go through commercial banks to operate with dollars. This “correspondent bank” system was costly, slow, and risky. When Silicon Valley Bank collapsed at the end of 2023, Circle was holding $3.3 billion in USDC reserves at that bank — had the central banking system been in place, this event would not have occurred.

Access to the Federal payment system solves this problem. A stablecoin issuer or digital asset custody organization can perform dollar settlements at the central bank level, without relying on commercial banks.

Why now, why during the Trump era?

Four or five years ago, this scenario was unimaginable. Around 2023, the crypto industry entered a phase of “debanking” — banks, under unofficial regulatory pressure, ceased cooperation with crypto companies. Silvergate and Signature Bank closed one after another.

During Biden’s administration, the policy was about “isolating crypto risk.” The logic was simple: rather than regulating, they aimed to distance the system from banks.

With Trump returning to power in 2025, stablecoins are no longer seen as a significant risk but as a tool to strengthen the global position of the US dollar. The “GENIUS Act” (July 2025) for the first time provided clear legal status for stablecoins at the federal level. OCC leveraged this legal framework to approve these licenses.

Honestly, how expensive are correspondent banks?

Payment costs for digital asset organizations are extremely high. Direct connection to the Federal Reserve via Fedwire offers 30-50% savings compared to using SWIFT and the correspondent banking system through commercial banks.

Circle manages around $80 billion in USDC. If the current correspondent banking model is replaced with a primary account at the central bank, transaction costs could save hundreds of millions of dollars in payments annually. This is not temporary optimization — it’s a fundamental restructuring of the business model.

Beyond costs, speed is also crucial. Settlements via Fedwire are much faster and more accurate. Traditional banking models operate on T+1 or T+2 cycles — which cause liquidity lockups and increase bank credit risk. In the central bank system, settlements are real-time.

The other side’s position

Wall Street lobbyists are very unhappy. The Bank Policy Institute (JPMorgan, Citibank, Bank of America) responded with four main accusations:

First, regulatory arbitrage. By granting trust bank licenses, technological companies like Ripple or Circle are essentially performing core banking activities such as payments and clearing. But their parent companies avoid consolidated oversight by the Federal Reserve as “bank holding companies.” This creates a loophole for regulator scrutiny.

Second, the separation of banking and manufacturing is broken. Tech giants could direct bank funds into their own businesses. Circle or Ripple could leverage their data and social network monopolies to squeeze traditional banks.

Third, systemic risk. These new trust banks are not FDIC insured. If stablecoin prices fall, traditional deposit protections do not apply — leading to rapid liquidity crises.

Fourth, the role of partner banks. Currently, five new banks need to open primary accounts with the Federal Reserve to gain direct Fedwire access. Since this issue is unresolved, the correspondent banking model may continue temporarily.

The future is complex

OCC approval is not confidence — it’s a new dawn. Regulators now need to develop rules: capital requirements, risk management, cybersecurity standards.

State regulators (like the New York Department of Financial Services) still do not take the lead. Federal primacy, if their authority is limited, could trigger new legal disputes.

The bottom line is that crypto finance is no longer outside the banking system — it is inside. But balancing traditional and digital finance will remain a key challenge for US regulators for years to come.