Coinbase (NASDAQ:COIN) is taking a step forward in further expanding its business capabilities and regulatory oversight beyond the current framework, as part of an effort to pave the way for tech advancements and growth in building a financial system enabled by digital assets.
By seeking a National Trust Company Charter from the Office of the Comptroller of the Currency (OCC) in order expand upon their custody business, Coinbase says it is aligning with their track record of obtaining licenses that aim to hold the crypto exchange to the highest standards.
This aims to position them to bridge the current gap between the crypto economy and traditional financial ecosystem.
However, Coinbase said that it has no intention of becoming a banking institution.
It is their belief that clear rules as well as the trust of their regulators and customers enable Coinbase to innovate while ensuring oversight and security.
Should it be approved, the charter may continue to open up opportunities for Coinbase to launch products beyond custody, such as payments and related services, with the assurance of regulatory clarity, thus enabling greater institutional adoption.
As they pursue a national charter, Coinbase Custody Trust Company (CCTC) and Coinbase Inc. is to operate under the aegis of the NYDFS.
Since 2015, NYDFS’s BitLicense framework fostered operational maturity and institutional trust, allowing Coinbase and the larger crypto industry to progress toward acquiring a federal charter today.
Coinbase says that it has sought uniform / consistent rules and regulations for crypto.
Although progress is said to be currently underway in Congress to create clear market structure, crypto is woven into the fabric of the financial sector.
An OCC charter will now aim streamline oversight for new offerings and enable continued innovation to integrate digital assets into TradFi.
Coinbase is not the first crypto company to seek a federal charter and they might not be the last.
And achieving this milestone now might position the digital assets platform to succeed as the future of finance continues to unfold in the coming years.
Coinbase concluded that it now looks forward to working with OCC staff duromg their review process and collaborating to address feedback from the agency or questions emerging via public comment.