Elizabeth Warren, who serves on the US Senate Banking Committee, questioned the “trust charter” approvals given by the OCC, which supervises national banks in the country, to nine cryptocurrency-focused institutions. Warren argued that these institutions do not meet federal regulations and pose a risk to the financial system.
Criticism of the editing process
During the Trump administration, the OCC granted trust charters for banking activities to crypto-related companies such as Coinbase, Paxos, Ripple, BitGo and Fidelity Digital Asset Services. In this process, the agency adopted a more friendly regulatory approach towards the crypto industry. However, Warren requested that these approvals be explained in detail in the letter she sent to OCC Chairman Jonathan Gould.
Warren argued that the OCC’s practice violated federal law, arguing that the companies in question were trying to avoid the basic protections and obligations required for banking. He also pointed out that the decisions taken pose significant risks for consumers, the security of the banking system and the separation of banking and commerce.
These companies are essentially crypto banks and want to escape the basic obligations that come with being a bank. The agency’s support of such a regulatory loophole is not only against federal law; It also poses serious risks to consumers, the security of the banking system, and the separation of banking and commerce.
Trust charter and compliance discussions
Crypto-focused companies are choosing to operate with trust company permission rather than full-fledged national bank status, which is subject to strict regulation. Warren emphasized that these companies do not actually act like trust companies, but act closer to classical bank activities. For example, he stated that services such as custody services, payment facilitation, lending and stablecoin transactions stand out in the business plans of these institutions.
Trump administration and political background
The complaint letter also requested the sharing of records regarding whether there was any communication between the OCC and former President Donald Trump or his family regarding the granting of a trust charter. Warren, especially World Liberty Financial Inc., of which the Trump family is a shareholder. He had repeatedly criticized his approach.
OCC’s response awaited
The OCC has so far not publicly responded to Warren’s formal request. It remains a matter of curiosity whether the regulatory authority will make a statement in the future.
