Paxos and BitPay have filed to become national banks in the United States of America
Cryptocurrency startups Paxos and BitPay have filed to become federally regulated banks in the United States. The Atlanta Journal-Constitution published a public legal notice on 8 December revealing that BitPay had applied to the Office of the Comptroller of the Currency (OCC) to become a federally regulated bank. The bank will be named the BitPay National Trust Bank and will have its headquarters in Georgia.
According to the filing, there would be a 30-day comment period, and all comments would be directed to the OCC licensing director. The BitPay application revealed that the market cap of the national bank would be around $12 million. The $12 million would be raised from 120 million shares to be issued by the bank. If BitPay becomes a national bank, the company could bypass the state-by-state regime of seeking a license to operate in the states.
On the same day, stablecoin issuer and crypto services firm Paxos filed to become a federally-regulated bank in the United States. In the public document published yesterday, Paxos made its intentions known to establish the Paxos National Trust and has already submitted its application at the OCC.
The application revealed that the Paxos National Trust would operate out of New York. If Paxos is granted the federal banking license, it would add to its New York trust charter and several other financial licenses.
Currently, Paxos offers various financial services, including cryptocurrency services, cash custody, gold custody, commodities trading, digital asset issuance and securities clearing. Getting a banking license would increase the number of services it would offer to individuals and legal entities.
Paxos general counsel Dan Burstein said in a company blog post that obtaining the national charter would allow them to conduct business across state lines more easily. For Paxos, this means focusing resources on building great products as they have the flexibility to operate across the United States while continuing to adhere to the highest regulatory standards. Similar to BitPay, Paxos’s application will have a 30-day comment period before the OCC can proceed.
BitPay and Paxos are filing for national bank licenses because of the positive moves made earlier this year by OCC Acting Comptroller Brian Brooks. Brooks announced a few months ago that he would be setting up a licensing framework for fintech startups, including cryptocurrency companies. This would allow them to streamline their operations within the United States.