In a digital asset banking context, the bank might mint stablecoins, hold or manage reserves, provide wallet integration or on-chain settlement, or enable deposit or loan services denominated in digital tokens. The broader aim is to bring stablecoins into mainstream commerce and onto payments rails.
Dual Tracks of Regulation
In the United States, digital asset banking is evolving along two overlapping regulatory tracks. At the state level, jurisdictions such as Nebraska are authorizing new types of charters (e.g., digital asset depository institutions), recognizing token issuance, custody and deposit services under banking law. Simultaneously, at the federal level, Congress and agencies are working on frameworks for stablecoins and digital asset oversight.
The GENIUS Act places stablecoins under bank regulators like the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corp., shifting oversight away from the Securities and Exchange Commission and Commodity Futures Trading Commission.
Banks and FinTechs are pressing the U.S. Treasury about compliance gaps in the GENIUS Act, particularly the need for clear reserve and liquidity rules. Draft legislation would assign primary jurisdiction over digital asset transactions to the CFTC, signaling that federal market structure legislation remains fluid. The dual-track reality creates opportunity through state charters, enabling innovation now. There’s also a measure of complexity, through overlapping jurisdictions, evolving rules and enforcement ambiguity.
The Nebraska News
The Nebraska Department of Banking and Finance (NDBF) issued a charter to Telcoin Digital Asset Bank last week, making it the first U.S. bank authorized under state law to operate as a “digital asset depository institution.” The charter is enabled by the state’s 2021 Nebraska Financial Innovation Act, which authorized digital asset depository institutions under Nebraska law.
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Under the charter, Telcoin Digital Asset Bank is permitted to issue a stablecoin (reported in a Nov. 12 press release as “eUSD”), take deposits, extend cryptocurrency-linked loans and connect to payments rails, essentially merging regulated banking functions with on-chain digital asset services. NDBF Director Kelly Lammers said the funds backing each stablecoin are predominantly U.S. government bonds or deposits in FDIC-insured Nebraska banks, a reserve standard aiming to ensure “the payment is always good.”
Challenges and Compliance Considerations
Key compliance and operational issues must be managed carefully. First, stablecoin issuers and banks must maintain full backing of each token, robust reserve attestation, transparent auditing and liquidity buffers. Firms must be prepared for redemption risk and run risk.
By way of example, the Conference of State Bank Supervisors urged regulators to ensure that reserve and custody positions of stablecoin issuers are subject to periodic examinations by the chartering regulator. Other consumer protection issues centered on how deposit insurance, resolution regimes, insolvency protections, disclosure and redemption rights apply when a bank issues on-chain tokens.
The dual-track regulatory model means that state charters like Nebraska’s may proliferate while federal rulemaking remains incomplete, raising coordination risk, regulatory arbitrage and standard-setting issues.
Stablecoins may threaten traditional rails, but payments networks emphasize that compliance, trust and legacy rail integration remain critical, suggesting that the technology alone will not guarantee broad adoption.
The compliance bar and oversight expectations will be high. For regulators and supervisors, Nebraska’s milestone will likely catalyze other states to issue charters and federal regulators to accelerate guidance or rulemaking. Entities planning digital asset strategies will need to navigate state charter pathways and impending federal standards.
