In a recent blog post, the cryptocurrency exchange said it had applied for the charter with the Office of the Comptroller of the Currency (OCC) to build on its custody business.
“Coinbase has no intention of becoming a bank. It is our firm belief that clear rules and the trust of our regulators and customers enable Coinbase to confidently innovate while ensuring proper oversight and security,” the blog post said.
“If approved, the charter would continue to open up opportunities for Coinbase to launch new products beyond custody, including payments and related services, with the confidence of regulatory clarity, fostering broader institutional adoption.”
The company says it will still continue to operate under the framework of the New York Department of Financial Services as it pursues the charter.
Coinbase further noted it has “long sought uniform rules and regulations for crypto,” writing that while progress is underway in Congress to create a clear market structure, crypto is already embedded into the finance system.
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“An OCC charter will streamline oversight for new offerings and enable continued innovation to integrate digital assets into traditional finance,” the company said. “We’re not the first crypto company to seek a federal charter and we won’t be the last. Achieving this milestone now will position Coinbase to succeed as the future of finance unfolds.”
Writing about the issue of crypto custody earlier this year, PYMNTS noted the “chasm” left by the “absence of a fully bank-regulated custody option.”
Asset managers launching spot-crypto ETFs, corporate treasurers experimenting with stablecoin settlements, and multinationals considering tokenized payments have traditionally largely had to work through a handful of non-bank providers.
“Much of that role has been assumed by crypto-native companies such as Coinbase, BitGo or Anchorage,” the report added. “While technically competent, these firms operate under a different regulatory perimeter, one that doesn’t always align with the risk appetites of traditional finance.”
The report noted that Coinbase maintains more than 80% custody market share for crypto ETFs, a level of “single-point dependency: that has not gone unnoticed in corporate boardrooms.”
“Another driver of institutional-grade custody needs has been the institutionalization of crypto markets through products like spot bitcoin ETFs,” PYMNTS wrote.
“Since the Securities and Exchange Commission green-lit these funds in early 2024, their growth has been explosive. BlackRock’s iShares Bitcoin Trust alone has reached a market capitalization of around $90 billion.”
