Community banking group sues OCC over national trust charters for crypto firms

The Independent Community Bankers of America (ICBA) filed suit Friday against the Office of the Comptroller of the Currency (OCC). ICBA filed the complaint under the Administrative Procedure Act in the U.S. District Court for the District of Columbia. The lawsuit challenges the OCC's authority to charter national trust banks for cryptocurrency firms. The complaint asks the court to declare unlawful a March 2, 2026 final rule and the related OCC Interpretive Letter No. 1176.

ICBA argues that the OCC has expanded the national trust charter beyond the limits Congress set. ICBA President and CEO Rebeca Romero Rainey said granting such charters for substantial non-fiduciary activities exceeds the authority Congress gave the agency. Rainey argued that these firms gain federal bank charter credibility without the Community Reinvestment Act obligations and consolidated supervision that bind insured depository institutions. Rainey also cited the absence of the capital and liquidity standards and FDIC insurance that apply to insured depository institutions.

ICBA warned that digital assets held at crypto firms operating under trust charters lack the federal protections customers expect from chartered banks. The lawsuit contends that the charter preempts many state consumer-protection laws while subjecting these entities to lighter regulation than traditional banks. The complaint seeks to have Protego Holdings' conditional charter vacated, citing governance and risk-control shortcomings at the firm.

The lawsuit escalates an ongoing dispute as Circle, Ripple, Kraken's parent Payward and Donald Trump-tied World Liberty Financial pursue OCC charters. The OCC has cleared or received applications from digital-asset companies including those firms, Paxos, Fidelity, BitGo and Jack Dorsey's Block.

Senator Elizabeth Warren has separately called the approvals illegal. However, the industry has disputed Warren's accusation. The OCC is working to finalize GENIUS Act stablecoin rules by November, adding another dispute over crypto's role in the federal banking system.