Concept
Obtaining a U.S. banking charter is a foundational step for a crypto firm seeking to integrate with the traditional financial system. This process involves a rigorous examination of the firm’s capital adequacy, risk management, and operational controls. The core of the challenge lies in translating the unique risks of digital assets into a framework that federal and state regulators can accept and supervise effectively.
The capital requirements are designed to ensure that the institution can absorb unexpected losses and protect depositors and the broader financial system from the volatility inherent in crypto markets. This endeavor requires a substantial financial commitment and a deep understanding of banking regulations.
The Regulatory Gateway to Traditional Finance
For a crypto firm, a banking charter is more than a license; it is a bridge to the established financial world. It grants access to payment rails, deposit-taking capabilities, and the ability to offer a wider range of financial products. However, this access comes with significant responsibilities. Regulators like the Office of the Comptroller of the Currency (OCC) and state banking departments mandate that any institution holding a charter must maintain sufficient capital to guard against insolvency.
This capital acts as a buffer, ensuring the firm can withstand market shocks without relying on taxpayer-funded bailouts. The process of securing a charter forces a crypto company to mature its operations, implementing the kind of robust governance and risk management frameworks that are standard in traditional banking.
Harmonizing Innovation with Stability
The journey to becoming a chartered bank compels a crypto firm to align its innovative, technology-driven culture with the stability and soundness principles of the banking sector. Regulators are tasked with fostering innovation while safeguarding the financial system. As such, they have been developing frameworks to address the novel risks presented by digital assets.
Interpretive letters from the OCC have clarified that national banks can provide custody for crypto assets and support stablecoin projects, provided they do so in a safe and sound manner. This creates a pathway for crypto firms to enter the banking system, but it also sets a high bar for compliance and operational resilience.
Strategy
A crypto firm’s strategy for obtaining a U.S. banking charter hinges on a critical choice ▴ the type of charter to pursue. The two primary paths are a national charter from the OCC or a state-level charter, with Wyoming’s Special Purpose Depository Institution (SPDI) charter being a prominent example specifically designed for digital asset companies. Each path presents a distinct set of capital requirements, operational constraints, and strategic trade-offs. A thorough analysis of these options is essential for a firm to align its business model with the regulatory framework that best supports its long-term objectives.
A firm’s choice of charter dictates the specific capital and operational rules it must follow, shaping its path into the regulated financial system.
Navigating the Chartering Options
The decision between a national and state charter involves weighing the benefits of a uniform, nationwide regulatory framework against the potential advantages of a more specialized, state-level regime. An OCC charter provides a single set of rules for operating across the country, which can be more efficient for firms with a national footprint. However, the capital and liquidity requirements may be more stringent and less tailored to the specific risks of a crypto-focused business. In contrast, a state charter like Wyoming’s SPDI is designed with digital assets in mind, offering a more bespoke regulatory environment.
A Comparative Analysis of Capital Frameworks
The capital requirements for different charters vary significantly, reflecting the different risk appetites and supervisory philosophies of the regulators. The following table provides a high-level comparison of the known capital requirements for an OCC national trust bank charter (as granted to Anchorage) and a Wyoming SPDI charter.
| Requirement | OCC National Trust Bank (Anchorage Example) | Wyoming SPDI (Kraken Example) |
|---|---|---|
| Initial Capital | Minimum of $7 million. | Greater of $10 million or 1.25-1.75% of assets under custody. |
| Liquid Assets | At least 50% of capital must be in eligible liquid assets. | Must maintain 100% of fiat deposits in liquid assets. |
| Liquidity Requirement | Greater of 180 days of operating expenses or $3 million in eligible liquid assets. | Surplus fund to cover three years of estimated operating expenses. |
| FDIC Insurance | Not required for non-depository trust banks. | Not required. |
The Intricacies of Risk Weighted Assets
A critical component of capital adequacy is the calculation of risk-weighted assets (RWA). For traditional assets like loans and mortgages, the risk weightings are well-established. However, for crypto assets, the methodology is still evolving. Regulators are grappling with how to appropriately measure the risk of volatile assets like Bitcoin and Ether.
The Basel Committee on Banking Supervision has proposed a framework that would assign a 1,250% risk weight to unbacked crypto assets, effectively requiring banks to hold capital equal to their exposures. U.S. regulators are considering how to implement these or similar standards, which will have a profound impact on the capital requirements for crypto banks.
- Tier 1 Capital ▴ This is the core capital of a bank, consisting of common equity and retained earnings. It is the most loss-absorbing form of capital.
- Tier 2 Capital ▴ This is supplementary capital, including items like subordinated debt and loan-loss reserves. It provides a lesser degree of protection to depositors.
- Total Capital ▴ This is the sum of Tier 1 and Tier 2 capital. Banks must maintain a minimum total capital ratio as a percentage of their risk-weighted assets.
Execution
The execution phase of obtaining a banking charter is a meticulous and resource-intensive process. It requires a firm to not only meet the prescribed capital and liquidity thresholds but also to build a comprehensive operational framework that can withstand intense regulatory scrutiny. This involves developing robust policies and procedures for everything from corporate governance and risk management to cybersecurity and anti-money laundering (AML) compliance. The application itself is a detailed document that must articulate a clear and sustainable business plan, demonstrating to regulators that the firm has the financial strength and operational expertise to operate in a safe and sound manner.
The Charter Application Blueprint
The application process for a banking charter is a multi-stage endeavor that requires careful planning and execution. A firm must engage with regulators early and often, providing transparency into its business model and risk management practices. The OCC and state banking departments have specific requirements for the content of a charter application, which typically includes the following components:
- Business Plan ▴ A detailed description of the proposed bank’s strategy, products, services, and target market.
- Financial Projections ▴ Three to five years of pro-forma financial statements, including balance sheets, income statements, and cash flow statements.
- Capital Plan ▴ A comprehensive plan detailing the sources and uses of capital, as well as a strategy for maintaining capital adequacy over time.
- Management Team ▴ Biographies of the proposed directors and executive officers, demonstrating their experience and qualifications.
- Risk Management Framework ▴ A detailed description of the firm’s risk management policies and procedures, including those for credit risk, market risk, operational risk, and compliance risk.
Assembling the Operational Toolkit
Beyond the application itself, a crypto firm must build the internal infrastructure to support its banking operations. This includes implementing a robust compliance program to adhere to the Bank Secrecy Act (BSA) and other AML regulations. It also requires developing a sophisticated cybersecurity framework to protect against the unique threats facing digital asset companies. The following table outlines some of the key operational components that regulators will expect to see in place.
| Component | Description | Regulatory Focus |
|---|---|---|
| Corporate Governance | A well-defined governance structure with an independent board of directors and clear lines of accountability. | Ensuring effective oversight and control. |
| Risk Management | A comprehensive framework for identifying, measuring, monitoring, and controlling all material risks. | Maintaining the safety and soundness of the institution. |
| BSA/AML Compliance | A robust program for detecting and reporting suspicious activity, including customer identification and due diligence. | Preventing money laundering and terrorist financing. |
| Cybersecurity | A multi-layered security architecture to protect against hacks, theft, and other cyber threats. | Safeguarding customer assets and data. |
A successful charter application is built on a foundation of robust operational controls and a clear, sustainable business plan.
Ongoing Supervisory Engagement
Obtaining a charter is not the end of the regulatory journey; it is the beginning of an ongoing relationship with supervisors. Chartered institutions are subject to regular examinations and continuous monitoring to ensure they are operating in a safe and sound manner. For a crypto bank, this will involve demonstrating that its risk management and compliance frameworks are effective in mitigating the unique risks of the digital asset market. A firm must be prepared to invest in the people, processes, and technology to meet these ongoing supervisory expectations.
References
- Hunton Andrews Kurth LLP. “OCC Charters the First National Crypto Bank.” 19 January 2021.
- Fireblocks. “What OCC Letter 1184 Means for Banks Getting Into Crypto.” 12 June 2025.
- Gibson Dunn. “Update on the U.S. Digital Assets Regulatory Framework ▴ Market Structure, Banking, Payments, and Taxation.” 5 August 2025.
- “OCC Conditionally Approves Bank Charter for Second Crypto Firm.” 25 February 2021.
- “The Cowboy State Tames Bitcoin’s Regulatory Wild West.” The Regulatory Review, 7 April 2021.
- Montague Law. “Wyoming Crypto Laws ▴ Pushing to be Crypto Capital #1.” 11 November 2022.
- Kraken. “What is the SPDI Charter? | SPDI Framework.” 18 October 2024.
- Seward & Kissel LLP. “Kraken Becomes First Digital Asset Firm to Obtain a Bank Charter.” 21 September 2020.
- Poyner Spruill LLP. “The Federal Reserve’s Rejection of SPDI Custodia Bank’s Applications.” 16 February 2023.
- Buchalter. “New Federal Regulatory Regime Provides Foundation for Financial Institutions to be Stablecoin Issuers and Accept Cryptocurrency Payments.” 5 August 2025.
Reflection
The Future of Crypto Banking
The path for a crypto firm to secure a U.S. banking charter is both challenging and transformative. It requires a fundamental shift in mindset, from a fast-moving, technology-focused startup to a mature, risk-conscious financial institution. The capital requirements, while substantial, are just one piece of the puzzle.
The real challenge lies in building a culture of compliance and a robust operational framework that can satisfy the exacting standards of bank regulators. As the digital asset market continues to evolve, the firms that can successfully navigate this process will be well-positioned to shape the future of finance, bridging the gap between the worlds of crypto and traditional banking.
Glossary
Capital Adequacy
Banking Charter
Capital Requirements
Risk Management
Digital Asset
Occ National Trust Bank
Wyoming Spdi
Risk-Weighted Assets
Anti-Money Laundering
