Coinbase clashes with banks over 'trust charter application'… denies it as "lobbying to protect themselves"

U.S. cryptocurrency exchange Coinbase (Coinbase), which is pursuing an application for a 'National Trust Charter (National Trust Charter)' to enter traditional finance, is facing continued pushback from the banking sector. Coinbase strongly denied this, calling it "lobbying to defend vested interests."

On the 4th (local time), according to Cointelegraph, the Independent Community Bankers of America (ICBA) said in an official letter to the Office of the Comptroller of the Currency (OCC) that it "strongly opposes" the trust charter application of Coinbase's subsidiary. The ICBA cited as reasons for opposition that "cryptocurrency custody structures remain unproven and it is difficult to maintain profitability in a crypto bear market."

In response, Paul Grewal, Coinbase's chief legal officer, countered, saying "opposing a regulated trust charter means wanting cryptocurrency to remain unregulated" and that "bank lobbyists are trying to erect regulatory barriers to protect their own interests."

Coinbase applied to the OCC for a National Trust Charter last October and said it was "a measure to strengthen the link between the cryptocurrency economy and the traditional financial system." The OCC's review period is expected to typically take 12~18 months. In the letter, the ICBA demanded that the OCC "deny the charter or, at minimum, allow more time to review the legal and public interest impacts of Coinbase's business plan."

Coinbase said in relation to this application that "it does not intend to become a bank," but other crypto firms such as Ripple Labs and Circle have also applied for similar types of charters.